While our region has faced insufficient supply compared to demand for years, July marked five consecutive months of inventory growth. Although market inventory remains significantly low compared to previous years, there were 1,055 homes available for sale at the end of the July 2021, up 44.7% from June.
After home prices rose above the $500,000-mark in May, homeowners may have been encouraged to list, as existing inventory was higher than the previous month and year for the second month in a row, something not seen since March of 2020 just before the pandemic hit the market. At the end of June, there were 729 existing homes available for purchase, up 50.3% from June 2021 and up an astonishing 116.3% compared to July 2020.
Despite more inventory, the speed of the market continues to be fast. The number of days between when a home was listed for sale and an offer was accepted (also referred to as Days on Market) was at 13 days, on average, in July — 22 days faster than the same month last year.
The median sales price for homes in Ada County reached $540,000 in July, up 2.9% from June.
I have a handful of clients & friends who have been hesitant to buy because they are either waiting for, or afraid of, a market crash. I get asked all the time, “Home prices are so high! Are we going to see another crash? When is the bubble going to burst?”
The short answer to both questions is no! Science and DATA, along with several real estate and mortgage experts, are all saying the same thing: it’s not going to happen! The market crash in 2008 was primarily due to people buying homes that they could not actually afford. They defaulted on their mortgage loan, causing an influx of homes to be for sale, and prices dropped significantly. Mortgage lenders have since tightened up their buyer qualifications, making it harder for folks to qualify – in a good way.
The driving factor in today’s high prices is supply and demand, not a market filled with unqualified buyers. The country is about 3.8 million homes short of matching the demand. The lack of supply has created an upward pressure on housing prices, and that’s unlikely to change in the next few years.
So what is happening? A leveling. We are already seeing homes sit a bit longer on the market (only by a handful of days) and price reductions are becoming more common as sellers are having to face the reality that the time for price chasing is over.
If you’ve been waiting to buy, let me tell you this: the value you can gain in equity by purchasing a home now, will far outweigh the potential savings by waiting for the bubble to burst. Especially since you’ll be waiting a long while…
While the uptick in the number of homes for sale is great news for buyers, they must still be prepared to act quickly. Buyers must also know that an offer acceptance is only the beginning of the work that a REALTOR® will complete throughout a transaction working on behalf of their clients.
Following the average 13 days on market, as noted above, there was another 52 days between the offer acceptance and closing, on average, based on the homes sold in July. During this time period, there is typically a home inspection and title search, and if the buyer is purchasing with a mortgage, an appraisal and final loan approvals.
The REALTORS® representing the buyer and seller help keep these tasks on track and work through any follow-up items, such as: negotiating repairs based on the inspection report, providing documentation to the escrow agent at the title company, requesting documents and financials from a homeowners’ association (if applicable), and confirming closings costs or mortgage payoffs with the lender.
At Data Driven Real Estate, we help with other behind the scenes items including helping clients coordinate movers, obtain homeowners insurance, switch over utilities, schedule painters and/or handyman work, assist with changes of address, maybe locate temporary housing, and much (much) more.
Give Gabriel a call today to get a game plan in place for your next real estate move. As a top producer, Gabriel has the knowledge and expertise to help you succeed in any real estate market.
This market report is provided by Boise Regional Realtors.
