Boise Metro Housing Market Monitor

July 2019 Update
SW Idaho Homes & Real Estate-
Ada County- Boise, Meridian, Eagle, Kuna, Star
Canyon County- Nampa, Caldwell, Middleton


Here's what you need to know about buying or selling homes and real estate in the Boise Idaho area. My charts give you over a decade of perspective on current trends in the Boise metro housing markets to help you make general decisions on the timing of buying and selling property. Save this to your favorites and check in monthly. Also see my quarterly newsletter.

July... The spring rush is waning and the market typically gets a little softer starting in the July heat, which is good news for buyers hoping to find a home or investment property this year.

The other good news for buyers and why the housing market is so hot: Interest rates are at the lowest point in nearly 3 years and very near the all-time low. Locking in a rate this low for 30 years would be a huge benefit for years to come.

Home prices are up, but I would not wait for a downturn. With this housing shortage and strong economy, it could be years before prices soften.

If you are holding investment properties in the Boise area, I can almost guarantee your equity has grown greatly and your return on investment has shrunk. Should you keep it, sell, exchange or refinance? Can you get a better return on your money? Ask me what your current value and return on equity is.

For more housing stats (after you look at mine) see the May 2019 Housing & Economic Report for Ada County loaded with market trends and demographic data provided by the Boise Regional Realtors.

Housing Inventory Update in Boise Metro

The long view of available homes for sale in Ada & Canyon counties really shows how extreme conditions are right now in the Boise Metro and SW Idaho housing markets. The trend has been toward fewer available listings each year as population grows and homes sell fast. On existing homes sold in June, average days on the market (listing to offer acceptance) were just 18 in Ada and 16 in Canyon. Amazingly, the median time on market was only 6 days in both Ada & Canyon- half the homes listed sold in the first week!

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These are active (available) listings in Ada & Canyon County, Idaho on the first business day of each month, including all types of single-family homes, both existing & new construction.

Please note- hundreds of these are to-be-built or under construction, so actual inventory is much lower than it appears. See my pie charts below. This extremely low number of homes for sale is almost a guarantee that Boise area home prices will continue to rise faster than normal until listings make substantial gains on sales.

Q2 2019 Quarterly Median Home Prices- Ada/Canyon County

Home prices jumped again with strong demand in the Boise area.

For the second quarter, the Ada county median existing home price of $325,000 was up 8.5% from the previous quarter. Sales were actually down 7% from the previous year, due to low supply.

Year over year in Ada County the median existing home price is up 13.6% compared to Q2 of 2018.

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Canyon County's median existing home price of $234,900 for Q2 is up 9.26% from the previous quarter. Year over year, the Q2 median for Canyon County is up 16.87%. That's like 5 years of normal appreciation in one year- don't miss another!

Is this a bubble? Just compare below our median home prices in Q1 2019 to other metros around the West and the national median. We have recently surpassed the national median. However, the Boise Metro median remains well below the more relevant West and indicates that our prices could go higher. Boise came in third for fastest rising prices in metros on this list. The strongest appreciation is coming from in-migration as people relocate to more favorable and affordable areas.

NARMedians2019Q1.GIF


On a national level, housing supply has started to grow, but not yet in SW Idaho. Boise and SW Idaho's fast-growing population and strong economy continue to drive the shortage and push home prices upward.

I use only existing homes to gauge housing prices, as new construction is much more volatile. I also ignore meaningless monthly readings. Quarterlies are a much more reliable sample size and indicative of long-term trends in home prices. Be careful... these stats have limited relevance to an individual property. Ask me for a free market analysis on your property. I would be happy to estimate sale price and proceeds.

Boise ID Metro- Home Sales


Home sales follow the typical four-seasonal trend in Idaho, but the peaks and valleys have consistently moved upward in these charts of homes sold per month, clearly reflecting the growing population and housing stock in the Treasure Valley.

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These charts show all residential single-family property sold each month. I've added a line to show new construction. New construction in Ada County was really strong this spring as existing home prices are gaining on new. Both counties are showing the most ever new home sales this year.

Year over year sales have peaked lower (albeit only slightly) this year for the first time in 6 years. This was probably due to low inventory of existing homes, so I can't call this a change in the trends just yet.

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Canyon County home sales have also been trending steadily upward with population growth. The largest cities of Nampa, Caldwell & Middleton have all seen strong home sales as new people move in and affordability pushes people farther out from Boise. That big dip was the snowpocalypse of 2017.

New Construction has really ramped up in Canyon County this year! This may help to take some of the demand off existing homes in the future, but Canyon county supply levels are even lower than Ada's right now.

These charts show all monthly single-family home sales reported in the local MLS, including condos, townhomes, manufactured homes and new construction.


Supply & Demand Drives Home Prices

Pending homes (next month's sales) are the best forward-looking indicator of buyer demand. Dividing actives by pendings, we get a supply of homes in months that is very reliably predictive of future trends in home prices. According to NAR, a 5-6 month supply of homes for sale is a balanced housing market where prices are stable or slowly rising and neither buyers nor sellers have a distinct advantage. If you want to know where home prices are going in any local market, look at housing supply levels- also called the absorption rate.

Inventory

1-2 months

3-4 months

5-6 months

7-8 months

9-10 months

Price Variance

double-digit appreciation

single-digit appreciation

stable

singe-digit depreciation

double-digit depreciation


Here's the local picture of supply & demand with Ada & Canyon counties combined. NAR's table holds true- with supply near one month, prices are up double-digits annually in both Ada & Canyon counties. This is why I expect strong home price appreciation to continue in the Treasure Valley at least through 2019. A very good reason to invest in Boise real estate with confidence.

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Another sign of a possible change in the trends- year over year supply is higher for the first time in 4 years in this chart. Higher, but still very near the low end of the scale.

Can we build our way out of the shortage? Not likely, because developing new subs takes time and builders (and their lenders) are more careful not to over-extend today. A slow-down in demand is more likely to solve the supply shortage than over-building. Also, prices on new construction remain substantially higher than existing homes.

Ada County, Idaho

Including the cities of Boise, Meridian, Eagle, Star and Kuna, here's an overview of the Ada County housing markets looking at trends in supply, demand and inventory of homes for sale.

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The make-up of homes for sale tells us much about current market trends for both existing and newly-constructed homes. Regular sellers of existing homes tend to follow seasonal trends with most listings mid year during optimum selling and moving weather. Here's the same data in a line chart showing the recent history.

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Regular sellers of existing homes have been trending lower for 4 years as demand continues to build and not enough homes are listed in Ada County.

In the new construction segments- as of July 1st, we have a decreasing number of new homes finished and available and even more under construction in anticipation of continued strong demand. To-be-built listings have really faded. I see no danger of builders out-pacing demand with 879 new homes (only 326 built) for sale in Ada County. This represents at most a 2-month supply at the current pace of sales.

Distressed homes? Almost none! Foreclosures and short sales are very rare in SW Idaho now. Home prices in the Boise area have risen consistently for years now, causing few owners to get into trouble while upside down and unable to sell. Don't be fooled by the big websites that show all these pre-foreclosures in the Boise area- very few actually get sold at trustee sale auctions and almost none are going back to the banks.

Boise, Idaho

The crown jewel city of the Treasure Valley in SW Idaho, Boise is the largest housing market and typically leads the way in local real estate trends.

Boise had 508 existing home sales in June (Med $324,450 Avg $385,484 Average days on market 17)

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This charts shows the count of active and pending home listings on the first day of each month for the last 10 years. This includes all types of single-family homes: condo, townhouse, manufactured, stick-built with and without acreage.

Boise has been one of the fastest growing cities in the nation and housing inventory has never been tighter, driving home prices up. As of July 1st, homes under contract still outnumber homes for sale. The shortage eased slightly in June as listings gained on demand in Boise.

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These pie charts show the breakdown of all active homes for sale on the first day of each month. Boise had 740 (up 80 from June) total homes for sale on July 1st. More existing homes have been listed and new construction segments held at 34 percent of the pie this month. To-be-built listings have really faded with fewer lots available to build on.

Meridian, Idaho

Located in the center of the Boise metro area, Meridian is destined to grow simply by location. Recently named the best place to raise a family in the nation, Meridian is about half the size of Boise, but very similar in home prices.

Meridian had 222 existing homes sold in June (Med $325,750 Avg $360,396 Average days on market 19)

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Meridian home sales also took off strong this spring, but have levelled off and new listings are gaining now. The supply of homes remains extremely tight (under a month) and I would not bet against brisk appreciation in home prices to continue this year.

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Meridian had 495 (up 40) total homes listed for sale on July 1st and now 60 percent of the pie is new construction. Major growth here with many homes under construction or newly built (118) and waiting for buyers in anticipation of continued strong demand.

Eagle, Idaho

With beautiful golf courses and growing greenbelt along the picturesque Boise River, Eagle is the higher-priced community in the Treasure Valley. Despite this, Eagle's economy is going strong and construction is increasing as affordability is not an issue here and builders are confident in continued demand.

Eagle had 72 existing homes sold in June (Med $477,500 Avg $557,552 Avg days on market 20)

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Eagle again has the highest supply levels of any city in the valley as contract signings have weakened this year. Still, with only a 1.73-month overall supply of homes for sale in Eagle, you can expect continued strong appreciation in home prices, but maybe a little more bargaining power for buyers.

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Eagle has seen a recent increase in both existing and new construction listings with 314 total homes for sale on July 1st. Now 47 percent of the available homes are new construction.

Star, Idaho

Star Idaho is a rising star in the Treasure Valley with river valley/rolling hills topography. Many people are relocating to Idaho and choosing this still-quaint little town for it's lower prices (compared to Eagle), relatively short commute (under 30 mins to airport/Boise)and a great name.

Star had 34 existing home sales in June (Med $347,500 Avg $369,755 Avg days on market 30)

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Star home sales picked up again this spring, but are not as strong as last year. Now just over a month supply of homes for sale to start July. No reason to expect less than double-digit annual appreciation here, like the rest of the Treasure Valley.

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Star had 108 (down 2) total homes for sale on July 1st and now 61 percent is new construction. There's a bunch of homes being built and a few finished to choose from.

Kuna, Idaho

Kuna has the lowest home prices in Ada County, making it popular for first-time buyers and investors. Located just 10 miles south of Meridian and freeway access, Kuna has a cute little down town and many starter level homes under 20 years old. Many people are choosing Kuna over longer commute and higher property taxes in Canyon county. Plus growth in the commercial sectors is finally catching up to residential around Kuna.

Kuna had 50 existing home sales in June (Med $273,250 Avg $281,627 Avg days on market 11)

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Kuna's home sales were really strong, but have peaked for the year and now listings are gaining on demand. Kuna still has very tight supply (less than 3 weeks) including new construction, and home prices MUST rise here.

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Kuna had 172 (up 22) total homes for sale on July 1st and now 70 percent is new construction. Many homes being built or finished! Buyers can expect bidding wars on existing homes here. I would feel lucky to have no competing offers on any home in the Boise area right now.

Canyon County, Idaho

Canyon County covers a large rural area of small towns. I focus on the metro area- Nampa, Caldwell & Middleton. My numbers may not match others' stats for the whole county, but I take the same readings every month, which works for identifying general trends.

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More existing homes have been listed this month, but even more went under contract. Now 56% of the available homes in Canyon County are existing.

Canyon county new construction is going strong with many more homes in progress and the completed homes are selling fast. Almost no foreclosed and short sales here.

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As of July 1st, there are 329 total new homes on the market, which is about a 2.25-month absorption rate, based on the 145 sold in June. That's not enough to relieve much pressure on low overall housing inventory. The cheapest new home sold was $209,990 in Canyon County last month.

Nampa, Idaho

Nampa is the largest city and main traffic hub (Caldwell is county seat) of Canyon County. Home prices have been jumping double-digits here too, due to strong demand and low supply.

Nampa had 201 existing home sales in June (Med $241,000 Avg $264,469 Avg days on market 17)

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One of the strongest markets in the valley, Nampa's pending homes still outnumber those actively for sale, but sales appear to have peaked. With only a .85-month supply of homes on the market, I expect Nampa's still affordable home prices to climb even higher this year.

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Nampa surged to 423 (up 8) total homes for sale on July 1st with an increase in existing homes listed and the new construction segments shrunk again to 48 percent of the pie.

Caldwell, Idaho

Caldwell, home of the world famous rodeo and one of the most affordable cities in the Boise metro area. Centrally located and the county seat, this is a growing city.

Caldwell had 119 existing home sales in June (Med $221,000 Avg $232,890 Avg days on market 11)

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Contract signings really surged in Caldwell this spring, but have peaked and new listings are now gaining on demand. The supply of homes in Caldwell has grown to a 3-week supply, behind only Boise for tightest supply. Home prices will keep climbing in Caldwell.

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Caldwell had 200 (up 35) total homes for sale on July 1st, with fewer existing homes listed. New construction now makes up 60 percent of the pie this month with a bunch of new homes completed or under construction now.

Middleton, Idaho

Middleton is at the far northwestern edge of the Boise metro. Small town but growing with very affordable home prices and many homes with acreage make the home prices seem higher.

Middleton had 41 existing home sales in June (Med $260,000 Avg $306,240 Avg days on market 25)

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Middleton's new listings and contract signings are both picking up after a lull this winter. Supply remains low- only a 1.13-month supply. Look for home prices to continue upward in Middleton this year.

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Middleton had 81 total homes for sale on July 1st with new construction segments growing to 44 percent of the pie as a few more homes where started and completed.

All charts are based on MLS data, deemed reliable but not guaranteed, searching all single-family housing types in the Boise-Nampa Metro, new and existing, including stick-built, homes with acreage, condos, townhouses, manufactured homes on rented lots and with land.

Thanks for your interest. Why settle for just an agent? I am a broker, licensed in Idaho, and Realtor since 1991 specializing in residential real estate for sale including homes, condos, townhouses, manufactured, acreage, land, lots, property. I serve Boise, Meridian, Eagle, Star, Kuna, Nampa, Caldwell, Middleton, Ada County, Canyon County, Treasure Valley and Southwest Idaho.
Dan Rowe ABR CRS GRI
Dan Rowe ABR CRS GRI
Broker