It is already August and 2019’s second quarter is behind us. Summer blazes through the Treasure Valley, and the housing market continues its climb to record heights for area homes prices. Meanwhile, the percentage of homes sold has fallen in Ada County, putting pressure on the rental market and incentivizing new construction. Throughout the year, the housing market has shifted; here’s how:
Home prices have also maintained their momentum, breaking records with every passing month, and Ada and Canyon Counties are entering unprecedented market conditions. Affordability decreases while supply remains in a tight, high margin that many home buyers find inaccessible. Despite this, Boise was still ranked 5th in the nation for first-time home buyers, mostly due to a combination of the city’s schools, jobs, and recreation opportunities over affordability.
Appreciation of homes prices is expected to rise even further, according to a new forecast from Veros real estate analytics. From Boise to Nampa, we might see up to an 9.4% increase in housing costs by June 2020. Median price of homes in Ada County have already risen 11.03% this year alone, which is down from an 19.28% increase by the same time in 2018, according to IMLS data. Appreciation rates may have slowed from last year, but this doesn’t necessarily mean a return to lower housing costs anytime soon.
When it comes to rising home prices, Idaho is dominating the nation. In actual sales numbers, our state might not be as competitive. Quarter 2 saw a decrease in the number of existing homes sold in both Ada and Canyon Counties, down 5.72% from Q1 in Canyon County and 7.17% in Ada. Last year existing home sales also fell from the first to second quarter, but at nearly imperceptible levels, 0.37% and 1.71% respectively. This wider margin represents a different market, one in which new constructions are giving home buyers the options that just aren’t there with affordable, existing homes.
Where existing home sales are slowing, new constructions are picking up. The number of new homes built rose overall in Q2 across the Valley. In Ada County, newly constructed homes have sold at a 15% higher rate than in Q2 of 2018. In Canyon County, the percentage of new homes sold has risen a staggering 45.30% from Q2 of last year, as home builders seek to provide a supply of more affordable housing outside Boise’s climbing costs.
Idaho’s growth is rippling outwards, with four Idaho cities making the Veros top ten list of the nation’s expected highest home appreciation rates. Boise-Nampa has moved to #4 on that list, while Idaho Falls has fallen from the top spot of an earlier report to #3, behind Coeur D’Alene. While the predicted rates of appreciation vary, it can be certain that Idaho will be the state with the highest rising home prices throughout, with Washington being a close second.
This hot Treasure Valley summer brings with it plenty of new construction alongside recording-breaking home prices to shape a less-active, more expensive season than in 2018. Growth continues its outward momentum, with plenty of new developments combating the tight supply of affordable homes.
This summer has consistently seen record-breaking home prices in the Treasure Valley. Cities all over Idaho are feeling the effects of appreciation in housing costs with no foreseeable end in sight. Has Idaho entered a new era of visibility and desirability? Are high housing costs and a competitive market the new normal for Idaho, or do you predict lower prices in the future? Share your thoughts, comments, and experiences with 208.properties on social media; we can’t wait to hear from you.