Boise Real Estate Blog

New Construction in Ada County

672 Burney Glen, New Construction For Sale $334,000

While doing a little research on the market, I stumbled on some interesting stats on new construction. In the past five years the percentage new construction in the market was around 33%. Every year since 2001, the dollar volume of new construction in Ada County has increased by around 100 million. The exception was from 2004 to 2005 when the volume doubled from 688 million dollars to 1.2 billion and then dropped in 2006 to 1.09 billion dollars. Those numbers reflect the increase in new construction housing prices of 43%. The difference didn’t hit the bottom of the builders pocket either. Every facet of the cost to build a home went up dramatically including the cost of government for permits and fees. Don’t worry folks, new construction and development pays its own way.

Inventory Drops in Boise Real Estate

Boise Real Estate

In last two weeks we had a substantial drop in housing inventory in Ada County. And surprisingly enough, we even had a positive article in the Idaho Statesman regarding Real Estate. It’s the first positive thing they have printed this year. The headline was “Ada County Real Estate Bottoms Out” or something close to that. Whether or not that headline is the correct forecast for our market is yet to be determined. Our team’s original forecast for a normal level of inventory was some time in the middle of 2009. It appears that was a pessimistic view of market conditions. If inventories continue to drop at the current rate we could see a corrected market by the middle to the end of 2008. The trajectory of the current inventory depletion puts us at about September of 2008 to reach 3000 listings.

Time to Get OFF the Fence!

Time To Get Off The Fence!

If you’ve been thinking about buying a home, or an investment property in the Boise area Real Estate market, now is the time! We have heard from a lot of our investors and home buyers that they are going to “wait and see” what happens. Many investors like to try to time the market, and buy when it hits “rock bottom”. It’s the old buy low, and sell high adage. That is a great thing when you can actually pull it off, but it’s a lot harder to actually do. All markets have cycles, and ours has been in a down cycle recently. The realty is that by the time the market cycles back up, it’s already too late, and you may have missed that opportunity to get the best deal!

Inventory levels of available properties in the Ada County real estate market have been dropping consistently for the last two months. This is an improvement, and tells me that we are already recovering from the worst of it, in terms of fewer sales and price reductions. Here are six things to think about if you’ve been thinking about buying:

-Interest rates on mortgages hit a 26 month low the other day.
-There are plenty of homes available NOW, and many great deals out there.
-Vacancy rates are extremely low right now, I have heard 3-4%, and rental rates are increasing due to the difficulty for some getting mortgages, those affected by the recent “mortgage meltdown” and being forced to rent.
-If home prices drop by 2.5%, but your interest rate goes up by .25%, you lose! Your payment will be higher.
-\Winter brings fewer sales statistically, that means sellers are more motivated.
-The market has been improving, so we may have already hit “bottom”.

These are six great reasons to buy now if you’ve been thinking about it. Again, even savvy investors can rarely time the market perfectly, so when you have an opportunity to get a great deal on a home, and a great interest rate on your mortgage, it’s the right time to buy!

Van States, Realtor, Advantage Real Estate Team

Where is the Boise Real Estate Market Heading?

Boise Real Estate

We have our November stats out on the Boise Metro Market and the numbers are encouraging. Ada County inventories have dropped by 400 since last month. Our staff has put together a excel spread sheet that allows us to project, based on our bi-month inventory chart, when we will be at a balanced market of between 3,400 and 3,500 listings. If we look at the last three months, our excel flow chart projects a balanced market somewhere in the last quarter of 2009. However, if we look just at the last month, the middle of 2008 appears to be the target. The number of listings on the market is definitely dropping.

If history repeats its self, and it usually does, an improvement in the market will start slowly then accelerate, just as it did when the market went into decline. We saw the market start to slow down around March of 2006. January of 2006 was actually the lowest inventory we experienced at 1438 listings. By March the increase really began to accelerate, with only a slight dip in June when inventories grew from 2,829 listings to 5,011 by the middle of October of 2006 to an eventual all time high of 5,788 listings on September 16th of this year.

Predictably, the rate of inventory declines will be mirrored by what we saw in inventory increases. It should take about as long to come down as it did to go up. If it took 22 months to run up, it could take that long to correct once the correction starts. The tough part is predicting when it will start and we have not been off the peak for very long. It appears now that the declining trend could continue until we reach a balanced market again somewhere between the middle of 2008 and the end of 2009. Right now it’s a pretty wild guess. We will continue to watch this very closely and report what we see.

This week we saw interest rates adjust and now are at the lowest rates in 26 months. Qualified conventional borrowers can now expect to get an interest rate of less that 6%. It makes no sense to wait. Homes that are selling are still selling for an average of 98% of the purchase price and an upward movement in rates of .5% will cost buyers much more than they could save by waiting for a lower price. It’s a great time to buy, don’t wait!

The Sky is not falling on Boise Real Estate

Boise Real Estate Market Improving!

I have been scouring the market for just the right property for upper end buyer that I have been working with. I really like them both, but they are certain that our market is going to go south in a big way. I have been trying to convince them that real estate markets are local. The region they are in may have an influence, but the local economy drive the real estate market, just like here in Boise. Idaho has the nation’s lowest unemployment rate at 2.3%. Montana is next with a 2.6% unemployment rate. Our inventory is falling faster that I originally predicted inventories would come back into line by the middle of 2009. Now, if this trend continues, the middle to the end of 2008 looks more like our target. If only we could convince the media that the sky is not falling on Boise Real Estate.

How to sell your Boise, Idaho Home FASTER!

Boise Real Estate for Sale

How to sell your Boise, Idaho Home FASTER!

Here are some quick tips to prepare your Boise, Idaho home for showings and ultimately to sell faster than others in today’s Real Estate Market:

Curb Appeal:
• Be sure your lawn is mowed and the yard it neatly kept up
• Keep windows clean
• Sweep away cobwebs around your front door
• Keep barking dogs tied up and out of the way
• Have lockbox installed and in plain site for agents easy access

A Clean Inside:
• Box up any of your clutter and clean off countertops
• Paint goes a long way, if your home is in need of paint, take care of it for the buyers
• Be sure your carpets are clean
• Make sure the dirty dishes are in the dishwasher, not just piled in the sink off of the countertop
• Empty the kitchen trash frequently.

Showing:
• Leave the house during a showing. Buyers will not talk about the house in front of you or open doors with you standing right there.
• If you stick around, don’t point out and or narrate the home for the buyer
• Do not pressure the buyer or hurry them around the home.
• Create a mood by turning on light music, light the fireplace, open window coverings to let in light
• Keep the home at a comfortable temperature

Above all, be sure to price your home realistically for TODAY’S market, not last years! There are over 5,600 homes on the market in Ada County! Competition is stiff for Boise Real Estate and not all of the homes on the market are salable. But you can make sure yours is! The homes in Boise that are selling are priced correctly and are in great showing condition.

Shantay Lewis, Boise Real Estate Agent,Realtor, Marketing Manager for the Advantage Real Estate Team

The truth about pricing Real Estate in Boise right now!

For the last couple of weeks I have been working with a client that is interested in Real Estate properties in Boise in the $600,000 to $1,000,000 dollar range. They have been very specific about the features and finishes the home must have as well as the location and view. They will be entertaining clients and want a kitchen with a double oven, a gas cook top with at least 6 burners, lots of counter space, granite or marble, an upscale fridge and an open family room that is large enough to accommodate a good crowd of people. They would also like to have a view property with 3000 to 4000 square feet. In preparation for showing them Real Estate properties in the Boise area, I have pre-viewed over 45 properties. I was astonished at how bad some of the listing agent’s comments were. Some of them definitely inflated the listing with flowery comments that oversold the property, but most were terribly inadequate in describing the feature and finishes. One agent had virtually no description of the features of an $800,000 home. Maybe she was related to the seller. The most disturbing thing was that in a market where we have a year and a half to two years on inventory in that price range, how many properties were badly over priced.

After viewing 45 homes in the price range you have a very good feeling for price. Some of these homes were spectacular and some had poor floor plans, were badly placed on the home-site, and were completely out of the market for price. A few agents called me for feed back and I had to tell them that their listing was $100,000 over priced.

As a listing agent, I appreciate it when agents give me honest feedback. Sellers are still fantasizing about what they could have gotten if they had sold in 2005. In this adjusting market we need to be honest will sellers about price, and sellers need to be realistic about the market. They need to listen to their real estate professional and price their home competetively. If you don’t need to sell, don’t list your home. Only those homes that are priced at market value are selling

Federal Reserves Effort No Help!

Boise Housing Market

The Federal Reserve's effort to bouy the housing market by lowering the federal funds rate had the opposite effect on mortgage rates. Long term mortgage rates have incresed to 6.8%. Those home buyers that have been sitting on the fence just lost purchasing power. With each 1/4 point raise in the rates the consumer loses about $5,000 in purchasing power. If a purchaser could afford a $1200 a month payment, Principle and Interest, when rates were interest at 6.5% a couple of weeks ago they could have purchased a home for $194,000 home. Now with rates at 6.8% they can only afford $188,000. If rates go to 7.5% their puchasing power will eroded to $175,000. $20,000 in purchasing power makes a big difference in what the consumer with end up with. If you are in the market to buy a home, buy now!

Ada County Current Market

Each month we spend most of the first day of the new month compiling the statistics from the past month. We segment the market by price range, count the active listings, count the number that went pending in the past month, how many closed and expired. We calculate the months of inventory and the difference between the average list price and average sold price for each price range. Augusts’ numbers were not encouraging. While the numbers were slightly better than July, we continue to post numbers equal to the late 90's. The only silver lining is that the percentage of list to sale price for the entire market remains a 96%. One must keep in mind that only 12% of the available inventory sold, which means that the homes that did sell were very well priced.

There will always be buyers and sellers in any market. It’s important to check your motivation if you intend to sell. There are only three things that determine the salability of any property. 1. Condition. The house, inside and out must look as good as possible. I am often asked whether or not to repaint or re-carpet or to offer an allowance. You never get a second chance to make a first impression. If the house needs work it’s always better to make the repairs before it goes on the market. 2. Its availability for showing. Homes that require realtors to make an appointment to show with the seller present simply don't get as many showings. In this market sellers should make it as easy as possible for Realtors to show their homes. 3. Price. With the amount of inventory on the market now, Realtors will show those homes that are the most competitively priced. If the home shows well and it’s available to show and it’s not selling, there is only one variable, PRICE!

Boise, Treasure Valley Real Estate Market Update

The Idaho Statesman on Saturday the 12^th of May had a headline that said “Nearly 8,000 homes for sale.”  That is definitely old news now.  On the 31^st of August, 8622 homes were for sale in Ada and Canyon Counties.  The May article stated that 63% of the homes for sale were investor owned.  What they meant to say that 63% were vacant, which was not inaccurate, but today 55% of them are vacant.

The investor invasion of 2005 definitely rocked our Real Estate World in the Treasure Valley.  Now we are in the midst of a major correction.  No one knows how long is will take or what the eventual outcome of the correction will be, but to be sure many owners of Real Estate will be affected.  Currently there are over 300 foreclosures in Ada county and around 175 in Canyon county.  The mortgage industry is reporting that $14 billion dollars worth of ARM loans will adjust in 2007 and we will probably see a flood of foreclosures from that.

The Treasure Valley market typically is about 40% new construction.  Today, 2,713 of the available homes in both Ada and Canyon Counties are being reported in the Intermountain MLS system as new and 281 of them are “To Be Built”.  The total new construction inventory constitutes a little less that 32% of the total inventory and if we subtract the 281 “To Be Built” homes, our current inventory contains less than 29% new construction.

Inventories have continued to grow since January of 2006, and will probably go even higher before things level out.  The Wall Street Journal, however, in an article printed May 9^th, stated “Portland, Boise, Seattle, Salt Lake City, Houston, Autsin and Charlotte and Raleigh, NC are among cities bucking the national trend.”  The headline read “Where home prices are hot now.”   Our local paper probably doesn’t get any of the larger wire services.

Truth is, Real Estate prices’ have held fairly steady over all.  Properties that are selling are selling for an average of 98% of the listed price and we have seen a decline in prices of less than 3%.  The worst could be ahead though with rumors of Micron getting ready for another round of lay-offs and the mortgage debacle still not settled down.  There are some great buys out there and many more will show up this winter.  This is when the real investors start to purchase.  Remember the old adage; buy low, sell high.