The Boise Housing Market Shift is Here
Everyone’s calling it a housing market shift – but what does that mean, especially for the Boise housing market? Let’s find out…
If you’re thinking of buying or selling a home in the Boise housing market, or really, even if you aren’t, you are probably hearing the new phrase “housing market shift” getting thrown around a lot these days. So, what exactly does that mean? Is it just a nice way to gloss over “housing market crash?”
Let’s dig into this housing market big shift, and what I’m seeing happening here in the Boise housing market in May of 2022.
I’m sure you’ve seen some recent articles that seem like chicken little running around yelling “the sky is falling!” regarding the Boise housing market. Bloomberg had a recent article stating that:
“Typical home values in Boise rose just 0.4% last month, down from a 4.1% monthly pace in June of 2021, according to Zillow data. That makes it the first of the country’s top 100 housing markets to flirt with falling prices this year.”
They are referring to the month of March 2022. And you have to keep in mind that Idaho is a non-disclosure state, meaning that Zillow does not have access to all of Idaho housing’s sold data. According to our local Boise Regional Realtor Association data, home prices in Ada County rose 2% in April 2022. So while that is less than the rate of appreciation in June 2021, it is more than the .4% as reported by Bloomberg using Zillow data.
This is all to say, listen to your local Realtor experts over Zillow! Well, that, and the sky, or the housing market as the case may be, is not falling, but it’s certainly shifting. And that’s what we want, right? I mean, no one likes the rising interest rates. As of May 20, 2022, they are around 5.25-5.5% for well qualified people, but the past couple of years of record-breaking markets were stressful for everyone and unsustainable. It kinda made me tired.
We are just beginning to see the Boise housing market shift, and it’s really showing up more in the day to day, less measurable things, like fewer people coming to open houses, buyers becoming pickier, home price reductions, fewer people coming to visit to see if they want to move here, and some builder incentives.
However, we are also still seeing homes sell for over asking price, some homes having 50 people come to an open house, and our days on market, on average, haven’t changed too much. Of course, some of that data takes a few weeks to show up, and as I said, we are just beginning to see some changes. But overall, the Boise housing market is just becoming quite sensitive.
However, we also typically have a buyer drop off at the end of May as, all parents know, May is busier than December in terms of kids’ recitals, sporting events, end of school activities. And with data being at our fingertips these days, it can sometimes be the thief of intuition if looked at under a microscope and the big picture is ignored.
What are some of our current numbers for the Boise housing market?
Ada county reached a new high Median sales price of $595,000 in April of 2022, and an average of $680,451. So that’s up 2% from last month.
New home sales did fall 21% from last year, but builder permitting was down last year, especially in the fall with the pinch of supply chain and other issues, so that is also a reflection of the new home sales dropping.
Existing homes sales dropped 17% from last year and inventory increased from around the 350 range in April 2021 to 950 homes on the market range in April of 2022. Just to put that in perspective, at the peak of the market in the early 2000s, there were over 5000 homes on the market. We are still at only 1.1 month, or about 5 weeks supply of inventory. So, while that has gone up from last year, it is still a strong seller’s market – except, why then, the price drops we are seeing?
This is where the housing market shift, or the sensitivity of the market, is most evident, in the price drops. While rising rates have left some buyers holding off, we still have a healthy demand that is higher than supply. But we’ve got two things at play here – with people paying more for a home and a higher rates, they are more picky about what they are getting, and with things shifting, if a seller, or a listing agent, doesn’t understand the very sensitive nature of our housing market right now, and they either price too high or they don’t do what it takes to make their house outshine the rest, it will sit on the market. So, it’s not sitting for months, more like a couple of weeks until the seller gets their price in line with the true value of their home.
Psychology and the Current Boise Housing Market
Another thing that the news won’t tell you is that the psychology of the buyer is different now than it was the last couple of years. Our Boise housing market was driven by politics and panic. We still have politics at play when people are choosing to move to the Boise, Idaho area. People wanting to get away from the political scene of their current state is still the number one reason people tell me they are moving here. But what they are not doing now is panicking. They rode out the pandemic pandemonium in their home states and have taken their time to decide to move here. And then they know they are paying more, for a higher rate, so their house they buy here better be move in ready, priced right, and everything they hoped for. No more of this “I have to buy a house in Boise right now, and I don’t care which one, I just have to get out” type of attitude. At least not for now. So, if a seller lists a home and it checks all the boxes, including correct pricing, then yes, it will still get multiple offers and can sell for over asking price. As of today.
Current Data and the Boise Housing Market
I pulled data from just May 1-May 20, 2022, to see where we are at in May with some things. It’s pretty interesting.
The median days on market for this time period, the past 3 weeks, was 3. This same time last year it was 4 days on market.
The median list price for the last 3 weeks in Ada County existing homes was $529,000 with a median sold price of $549,900.
Compared to last year same time, median list was $479,000 and median sold was $495,000.
So yes, we still have homes selling for over asking price, actually about 50% of homes are still selling for over asking.
This time last year there were 186 existing homes sold in Ada County and this year there were 123…so sales did fall from last year this time.
Will we have more inventory coming in the Boise housing market in June? I would assume yes, just based on typical school year patterns. And will we have more buyers in June? Again, I think yes because of our normal patterns.
Inventory and the Boise Housing Market
If the inventory is slower to sell, and it begins to accumulate, then we can see more price reductions- but we’re kind of in an odd stage of panic price reductions, which is another reason our market is very shifty right now. Sellers list, maybe it wasn’t even too high, maybe they listed right on the money, and they don’t get an offer after 3 days like has been the past norm, they panic, and drop the price $50,000 so they can get it sold in a few days. Or sellers may be more patient, not reduce the price, and sell in a few weeks. I think we are moving towards a Boise housing market where homes taking 30 days to sell will become the new normal, which is still a seller’s market, but people tend to forget that. Our housing market has been moving so furiously, that even though we need it to stabilize, now that’s it’s showing the first signs of stabilization, some people are panicking, but if everyone just chills out and realizes that we need to look at the big picture, not the isolated micro data, the road to more stability would be much smoother.
As I’ve said in my other 2022 Boise housing market videos, do I think we will have a housing market crash? No, I don’t see that for now. A housing market shift towards stabilization, absolutely, and at times, like right now, it is just quite shifty, like with this gap of homes having price reductions while at the same time, other homes are selling for over asking.
I think we will head towards a recession, but that doesn’t mean a crashing housing market. Whatever the case may be, people will still need to buy and sell homes, and if you’re thinking about doing that in the Boise area, reach out to us at summerastonrealestate.com, follow me on Instagram, send me a text or email and my team and I are happy to help.
