The median sales price for homes in Ada County reached $595,000 in April 2022, an increase of 23.9% compared to the same month last year, and a new record for the county. Higher prices in the new construction segment played a large part in the overall price jump. New home sales made up nearly a third of all sales in April with a median sales price of $645,000, up 36.7% from last year.
However, home prices rose across the board, with the median sales price for existing/resale homes reaching $570,000, a gain of 16.9% over last year. These were record highs for both segments.
Mortgage rates also rose in April, with the 30-year fixed rate mortgage average reaching 5.1% at the end of the month, according to data from Freddie Mac. National economists have predicted that the increase in mortgage rates will eventually slow the market, but we haven’t seen a price slowdown in our local sales data yet.
It’s important to remember that homes that closed in April likely went under contract in February and March, so we may not see the immediate impact of rates on prices for a few months. Pending sales, or those with an accepted offer that are expected to close in the next 30-60 days, may provide a better indication of how rates are affecting our market at this time.
There were 1,525 pending sales at the end of the month, a 12.1% decline from April 2021, and 815 total sales for the county in April, down 17.0% year-over-year. The existing/resale segment claimed 586 of those sales, which was a drop of 12.3% compared to last year. Higher home prices, coupled with higher mortgage rates, which results in higher monthly payments for buyers who are financing a home purchase, may be hampering sales.
Looking specifically at existing/resale sales data in April, 53.2% of buyers paid over list price, indicating that competition remained strong, particularly at the median and lower price points. While it may seem obvious, it means nearly half of all buyers did not pay over list, resulting in an average original list price received of 101.0% for existing/resale homes in April 2022, compared to 104.9% in April 2021.
Buyers may be discouraged by increasing rates and prices, but there is some good news — in April, inventory increased by 170.0% compared to the same month last year. While supply is still constrained, especially at the lower price points, more year-over-year inventory is a sign we may be seeing a shift to a more balanced market.
There is some uncertainty as to how inflation, higher mortgage rates, and other economic factors will affect the residential housing market; however, REALTORS® understand that each homeowner and buyer’s situation is unique, and help their clients make decisions based on factors that are within their control.
Whether you’re ready to buy today or would like to purchase within the next two, five, or even ten years, work with trusted advisors to make a plan to reach your goals. Taking important steps today, such as improving your credit, researching down payment programs, and saving for your down payment in a tax-sheltered savings account can really make a difference when you’re ready to make a move.
As a local real estate expert, I have a trusted network of vendors who can help you achieve your goals. From credit repair to financial advisors, painters, handymen, and more. My services go beyond just buying and selling real estate in the Treasure Valley. Give me a call if you need anything. I’m here to help you throughout your entire homeownership journey.
The median sales price for homes in Ada County reached $575,000 in March 2022, an increase of 22.6% compared to the same month last year, and a new record for the county.
This jump was driven primarily by the new construction segment — accounting for nearly a third of all sales in March — which saw a median sales price of $606,050, up 31.5% from last year. The median sales price for existing/resale homes was up 16.7%, reaching $555,000.
Many economists are predicting that the increase in mortgage rates will eventually temper home prices, but it’s hard to say to what extent, and if inventory will still remain the biggest factor in local home prices.
Looking at historical mortgage rates it’s clear that today’s rates are low, like really low. Since records started in 1971, the historical average for 30-year mortgage rates is just under 8%. So even though today’s rates are in the 4s and 5s, they are significantly under that average. In other words, if you’re in a position to lock in an interest rate, you’d be wise to do it sooner rather than later.
Peak rates occurred in 1981 at over 18% due to record inflation during the fuel crisis of that time. The lowest rates on record were during 2020 due to the pandemic, bottoming out at 2.65%. Looking at the larger trends of mortgage rates, it’s clear that this is definitely still the right time to buy for many potential and existing homeowners to purchase.
Fortunately, inventory has been increasing in recent weeks, with levels up 103.1% from the same time last year. More inventory is definitely good news for buyers, but they will need to make quick decisions once they find something they’re interested in since supply is still constrained.
The number of days on market for existing homes dropped to 15 days, on average, in March, down 34.8% from February. The 15-day average is the lowest since late last summer, which may be a sign that the spring market will once again be competitive. Whether due to limits on affordability or willingness among buyers, existing homes that closed in March didn’t sell for quite as much over list price as they did last year.
The percent of original list price received on homes in March 2022 was 100.8%, on average, compared to 104.1% in March of 2021. Another interesting finding was that fewer existing homes sold over list price this year than last year, with the share dropping from 58.7% in March of 2021 to 41.3% in March of 2022.
At first glance, it may seem odd that home prices have gone up so significantly when, on average, buyers are paying close to asking price. However, it’s important to note how list prices are set. When a similar home sells, it can become a “comparable” property for future listings nearby; so, as homes appreciate, future asking prices tend to rise as well.
But the list price is just a starting point. Sometimes buyers pay more, and sometimes they pay less. Ultimately, a home sells for what the market determines it’s worth.
Although it may be tempting for sellers to price their home lower than what comparable data indicates to encourage multiple offers, it’s important to remember that pricing low doesn’t guarantee a bidding war and may not always be in the seller’s best interest. On the other hand, setting an asking price that’s higher than what comparable data supports may exclude a seller’s property from some search results, potentially reducing the pool of prospective buyers. Using MLS data and market experience, Data Driven Real Estate will provide you with a pricing and marketing strategy that’s right for each property and situation.
The median sales price for Ada County reached $549,900 in February 2022, an increase of 21.6% compared to February 2021, and a new record for the county. Home prices in our area continue to be driven by insufficient supply compared to buyer demand and indicate we will likely see another competitive spring market.
Two metrics that demonstrate the competitiveness of the market include Days on Market and Percent of Original List Price received.
After enjoying a more normalized market pace in January, Days on Market for existing homes sped up in February to 23 days, on average. This counts the number of days between when a home was listed and when the seller an accepted offer. While this is a year-over-year increase of 14 days, or 155.6%, it’s a dramatic drop from January 2022 when the average was 33 days. Buyers may have a bit more time to shop, than they did last year, but will still likely need to make quick decisions once they find a home they’d like to purchase.
The Percent of Original List Price received for existing homes was at 99.6%, on average, in February. This means buyers paid slightly less than asking through a lower accepted offer or seller concessions. In contrast, buyers paid an average of 105.5% of the list price last year. Buyers may be unable or unwilling to spend over list prices to win a listing, as was common a year ago, or we’re seeing sellers pricing homes more in line with the market comparables.
Overall, we are seeing fewer bidding wars than last year, but that doesn’t mean it isn’t still happening in some instances. It just depends on the particular property, the list price, and what buyers are willing to pay.
At first glance, it may seem odd that home prices have gone up so significantly when, on average, buyers are paying close to asking price. However, as mentioned, each home sale becomes a comparable for future home sales of properties in the same location and with similar amenities, which is taken into consideration when pricing a new listing. So as homes appreciate, sellers are asking, and receiving, more for their homes than they have in the past.
But the list price is just a starting point — as indicated by the Percent of Original List Price received metric — sometimes buyers pay more, and sometimes they pay less. Ultimately, a home sells for what the market determines it’s worth.
It may be tempting to price your home lower than what the comparable data indicates it may be worth, in order to drive up the price with multiple offers. But it’s important to remember that pricing low doesn’t guarantee a bidding war. Pricing higher than what comparable sales support may exclude your property from the search criteria of possible buyers.
Using market data, Data Driven Real Estate will provide you with a pricing range and help you form a strategy to get your home in front of the maximum number of buyers so you can receive maximum value.
Another contributing factor that drove up the overall prices in February was the larger share of new construction home sales for the month. Due to increasing costs and shortages of materials, as well as increasing costs of land and labor, the median sales price for new homes was 30.6% higher than the same month a year ago, coming in at $587,551. In February, new construction homes made up 36.7% of all home sales, which also pushed up the overall median sales price for the county.
Other notable statistics from February 2022:
There were 493 homes available at the end of the month — 62.7% more than in February 2021 — although still very low compared to buyer demand.
Of the 660 sales in the county, 418 were existing homes, an increase of 21.9% compared to the year prior. Overall sales (existing and new combined) were up 7.1% compared to January 2021.
When you are ready to make a move, I am here to help you strategize how to get the most for your property both in terms of sold price and contract terms. Give me a call if you are ready to get the ball rolling!
In January 2022, the median sales price for homes in Ada County was $540,000, an increase of 20.0% compared to January 2021, but a slight decrease of 1.1% from the month before.
While the actual median sales price continues to trend upwards, the rate at which it does so has been slowing in recent months. Throughout 2019, we saw fairly steady price growth, and in December 2020, it jumped above 20% year-over year, reaching a peak of 45.3% in May 2021.
Since then, price growth has slowed, landing at 20.0% in January 2022 — by no means an insignificant year-over-year change, especially for prospective home sellers, but a welcome reprieve from the higher gains we saw last year, especially for prospective homebuyers.
Home price increases continued to be driven by insufficient supply compared to buyer demand — primarily fueled by population growth, migration trends, and increased purchase power due to historically low mortgage rates. The most recent uptick in demand came from people re-thinking how they live and work as a result of the pandemic, contributing to the competitive conditions that enabled the incredible price growth we’ve seen in the last year.
The metric used to illustrate the supply vs. demand relationship is Months Supply of Inventory (MSI), which takes the number of homes for sale divided by the average number of sales by month for the preceding 12 months. As of January 2022, Ada County was at just 0.3 months for existing homes and 1.0 month for new construction, meaning, if no additional homes were listed, the supply of homes would run out in a matter of weeks. A balanced market — not favoring buyers or sellers — is typically between 4-6 months of supply.
Even though buyer demand has been outpacing supply, weekly listing activity in 2022 has trended up, indicating that an increasing number of homeowners were ready to sell and cash in on the equity their homes have acquired over the last few years.
Listing activity in 2022 has so far been higher than the same period in 2021, but actual weekly listings were down compared to 2019 and pre-pandemic 2020. We’ll be watching to see if future weekly listings of existing homes match or exceed those in previous years.
With low, but increasing, inventory, will we continue to see the fast market pace and multiple offer scenarios experienced in 2021? We can’t say for sure, but so far Days on Market (DOM), the metric that measures the time between when a property is listed and when it has an accepted offer, has increased and normalized for existing homes.
Days on market for existing homes reached 33 days in January 2022, 18 days longer than in January 2021 and more in line with pre-pandemic levels in early 2020. This is good news for buyers as they may have a bit more time to make decisions and may not feel the need to waive contingencies when writing offers.
Additionally, the Percent of Original List Price Received for existing homes that sold in January 2022 was 97.3%, meaning that, on average, buyers paid less than asking through a lower accepted offer and/or seller concessions. In contrast, the Percent of Original List Price Received for existing home sales in January 2021 was 103.6%, indicating that, on average, buyers were paying more than asking price for homes.
It’s hard to say whether these longer, healthier market times were due to increasing prices, increasing mortgage rates, or some combination of the two. While competition may have begun ramping up again, one thing is for sure — our market needs more inventory in order to be more balanced.
Other notable statistics from January 2022:
The median sales price for existing homes in January 2022 was $515,100, 18.4% higher than in January 2021. The median sales price for new construction in January 2022 was $588,945, 28.0% higher than a year ago.
There were 441 homes available at the end of the month — 63.9% more than in January 2021 — although still very low compared to buyer demand.
Of the 671 sales in the county, 457 were existing homes, an increase of 30.6% compared to the year prior. Overall sales (existing and new combined) were up 10.5% compared to January 2021.
With the appreciation in home prices, there may be more equity in your home than you as a seller might think. That is why it is so important to work with a REALTOR who is a market expert in the Boise area. When you are ready to make a move, give me a call! As a top producer in the Treasure Valley, you’ll receive nothing but 5-star customer service in every transaction with me.
When summing up the December and 2021 Ada County housing market, one could easily argue that this past year brought the most fast-paced market we’ve ever seen, particularly in the first half of the year. The market conditions were incredibly competitive.
The Treasure Valley has faced limited housing inventory for years now, a phenomenon we’ve detailed in many of our reports. This lack of supply has been insufficient compared to the persistent demand for housing, which has driven up prices and caused a home buying frenzy earlier this year. We tracked the pace of the market by a few metrics — how quickly homes went under contract, the share of sales that sold over list price, and for how much they sold over list price.
We’ll first explore the data for each of these metrics in the existing home sale segment to illustrate just how competitive the market was in 2021.
The Days on Market (DOM) metric measures the time between when a property is listed and when it has an accepted offer. Overall, DOM for existing homes trended down, reaching a historic low of just nine days in May 2021. Since then, the DOM metric has increased and normalized, reaching an average of 30 days in December 2021 — 18 days longer than in December 2020, and more in line with pre-pandemic levels from early 2020.
Not only were existing homes selling at a faster rate, but a larger share of total sales sold for more than their asking price, usually the result of multiple offer situations. The share of homes that sold over list price passed 50.0% in September 2020 and reached a peak of 75.9% in March 2021. By December 2021, it dropped to 22.6%, possibly indicating that list prices have become more aligned with what buyers are willing or able to pay.
But how much over asking did buyers pay in 2021, on average? As the share of over list sales went up, so did the amounts paid over asking. In May 2021, 69.7% of existing homes sold were for over list price, with an average premium of $44,075, the highest we’ve seen (going back to 2006 based on our existing dataset). The average amount paid over list has dipped since then, coming in at $16,487 in December 2021.
Unsurprisingly, with tight competition for existing homes and so many buyers willing to pay over list, the impact on prices was significant. The median sales price for existing homes was $510,000 in December 2021, up 21.4% compared to a year ago. The year-to-date median sales price was $505,000, a 34.7% increase compared to 2020, and the largest annual gain since we began tracking this data in 2006.
The new construction segment also saw year-over-year price jumps, largely due to increasing costs of land, labor, and materials — as well as the ongoing impact of pandemic-related shutdowns that continue to create delays in increase costs in the global supply chain. In December, the median sales price for new homes was $579,990, a 30.4% increase compared to December 2020. The year-to-date median sales price in 2021 for new construction was $525,000, a 23.1% increase over the previous year.
While homes have continued to sell at higher prices, interestingly, sales have dipped in recent months, and more notably so when comparing data year-over-year. In 2021, there were 10,855 home sales (new and existing combined) a decline of 11.8% compared to 2020 and the lowest number of total annual home sales for the county since 2017.
How can one of the fastest growing metros in the U.S. with a persistent demand for housing have declining home sales? The data provides a few clues.
First, buyers can’t buy homes that aren’t there, so limited inventory has definitely limited sales. This is especially true at the lower price points where buyer demand is most acute and inventory is hardest to come by. While inventory has ticked up over the last six months, the slim 0.7 Months Supply Inventory in December is still a far cry from the 4-6 months needed for a balanced market.
When year-over-year home sales are broken out by segment, there was a 6.7% decline in existing home sales and a 21.7% decline in new construction sales. One reason there may be fewer new construction sales could be because buyers are having to wait longer to move into their new homes. The average number of days between when a home goes under contract and when it closes was at 106 days in 2021, 30 days longer than in 2020, limiting the number of closings that can take place within the year and possibly leading some new home buyers to opt for an existing home with a quicker move-in date.
Much to the relief of buyers, we saw more normal market times and increases in inventory in the last few months of 2021. However, we’re still a long way from a balanced market and we hope more homeowners are able to realize the great values for their properties by listing in the coming months.
Other notable statistics from December 2021:
The overall median sales price (existing and new construction combined) in December 2021 was $546,000, a new record high. This is likely due to the large share (35.1%) of the typically higher priced new construction home sales that closed in December.
There were 582 homes available at the end of the month — 75.8% more than in December 2020.
As mentioned in the release, the overall (new and existing combined) Months Supply Inventory was 0.7 months. For the existing segment, it was 0.5 months, or approximately two weeks.
In November 2021, the median sales price for new construction homes in Ada County was $601,301— passing the $600,000-mark for the first time. This is an increase of 39.8% compared to the same month last year.
This record reflects a variety of market factors that were present prior to the pandemic — namely increasing costs of land, labor, and materials — as well as the ongoing impact of pandemic-related shutdowns that continue to create delays in increase costs in the global supply chain. (A recent article from the National Association of Home Builders provides more context on this, and includes comments from a local custom home builder, Steve Martinez of Tradewinds.)
Speaking with Christine Comstock, Managing Associate Broker for CBH Homes, she echoed these sentiments, particularly on the impact of materials on the final price of a new home: “Lumber is a constant moving commodity. We work hard to keep our pricing in check in the midst of a fluctuating market. We are averaging a 24% increase year over year.”
The external pressures causing delivery delays are also beginning to impact the number of sales for new homes, which were down 32.2% year-to-date compared to last year.
Also effecting new construction sales, is the uptick in existing inventory over the past six months. There were 426 existing homes available for purchase at the end of the month, an increase of 217.9% compared to November 2020.
There is a strong correlation between the existing inventory and new construction pending sales (properties under contract with an accepted offer that should close within 30-90 days). Looking at activity since January 2019, we have seen new construction pending sales go up when existing inventory dips, then begin to slip as existing inventory increases.
You’ll always have a certain number of buyers in the market that are strictly looking for a new home, but existing homes are often the starting point for many buyers looking for something that’s move-in ready. So as existing home inventory has been limited, some buyers shifted to the new construction market. Then as delays in delivery occurred, and as more existing inventory is becoming available, some are reverting back to the resale market. This ebb and flow may seem obvious, but the big takeaway is that the demand for homes remains strong in our area, and motivated buyers continue make purchasing decisions based on what’s available.
The strong and consistent demand for housing is apparent when examining the Months Supply Inventory (MSI) metric, which takes the number of homes for sale divided by the average number of sales by month for the preceding 12 months. As of November 2021, Ada County was at just 0.9 months for existing homes and 1.5 months for new construction. This means, if no additional homes were listed, the supply of homes for sale would run out in less than two months. A balanced market — not favoring buyers or sellers — is typically between 4-6 months of supply.
Notable statistics from November 2021:
The median sales price for existing homes was $510,000, up 19.7% year-over-year and a slight 1.9% drop from October.
Existing homes were spending an average of 25 days on the market before going under contract, 92.3% longer than the 13 days we saw a year ago.
Total sales were down 7.8% from a year ago, primarily from delays in the new construction segment, as existing sales were up 3.5%. More existing inventory resulted in more existing home sales.
Whether you’re considering a new home or existing property, working with a REALTOR® is more important than ever. That’s where I come in – to guide you through every step of your home buying journey. Once a seller or builder has accepted your offer, the sale goes “pending” and there are a number of steps that need to take place before you reach the closing table. From appraisals and inspections to negotiations and final paperwork, I am there to make sure your interests are being represented throughout every step in the process.
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