Could Now Be the Best Time This Year to Buy a Home in Ada County?

In this month’s market report, we look at the question posed in a recent realtor.com article: “Is This September the Perfect Month to Buy a Home?”

While that article looked at national trends, based on the latest statistics from the Ada County Association of REALTORS®, the answer for our market seems to be “yes.”

Following the article’s lead, let’s take a closer look at local supply and demand, based on the most recent numbers through August 2015:

Metrics

Aug 2014

Aug 2015

YOY % Chg

Inventory

2,962

2,504

-15.5%

Pending Sales

911

1,279

40.4%

Median Sales Price

$218,990

$229,500

4.8%

Months Supply

3.8

2.7

-28.9%

 

There were 2,504 single-family homes for sale in Ada County as of August 2015, down 15.5 percent compared to August of 2014. But while inventory was down, there were 1,279 pending sales in August 2015, up 40.4 percent compared to the same time last year.

“This decrease in supply and increase in demand was the reason that many buyers and sellers found themselves in multiple offer situations over the Summer,” noted Brenda Kolsen, 2015 President of the Ada County Association of REALTORS®.

Further evidence of buyer demand could be found in the Months Supply metric which was at 2.7 months in August 2015, down 28.9 percent year-over-year. (A balanced market—not favoring buyers or sellers—is typically between 4-6 months of supply.)

This mix also helped push the Median Sales Price up to $229,500 in August 2015, 4.8 percent higher than it was in August 2014—good news for sellers still looking to move yet this year.

While this is the time of year that purchase activity tends to dip—both locally and nationally—it’s ideal for those buyers still hunting for a home. Brenda Kolsen explains: “Buyers shopping now aren’t competing with as many buyers as they would have been in the Spring and Summer. And this year is especially favorable, as mortgage rates continue to stay near historic lows.”

Finally, despite the noted lack of inventory compared to last year, the number of homes for sale has held steady since our seasonal peak of 2,512 in June 2015, giving buyers plenty of homes to choose from—particularly for those looking at new construction or at homes priced $400,000 and above.

So to answer the question, “Is This September the Perfect Month to Buy a Home?” for buyers in Ada County, the answer seems to be yes, and we expect favorable conditions to continue through the Fall.

 

Here’s how the rest of August 2015 shaped up for single-family homes in Ada County:

  • Inventory was at 2,504, down 15.5% year-over-year (not tracked YTD)
  • Months of Inventory was at 2.7 months, down 28.9% year-over-year (not tracked YTD)
  • Days on Market was at 45 days, down 15.1% year-over-year, down 7.3% year-to-date
  • Pending Sales were at 1,279, up 40.4% year-over-year (number not tracked YTD)
  • Closed Sales were at 837, up 12.4% year-over-year, and up 18.6% year-to-date
  • Median Sales Price was at $229,500, up 4.8% year-over-year, and up 7.6% year-to-date

Monthly Housing Snapshot for August 2015:

Market Snapshot_August

 

 

 

 

 

 

 

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The Ada County Association of REALTORS® represents nearly 3,500 real estate professionals throughout the Boise region. For more information about the benefits of working with a REALTOR® and to search for a REALTOR® by name, language, or professional designation, visit http://myacar.com/find-a-realtor.

NOTE: The information in this market report is based on a variety of sources, but primarily on the public statistics provided by the Intermountain MLS (IMLS), a subsidiary of the Ada County Association of REALTORS®, available here: http://publicstats.intermountainmls.com/static/Reports/Ada/2015/August-2015-Ada.pdf. These statistics are based upon information secured by the agent from the owner or their representative. The accuracy of this information, while deemed reliable, has not been verified and is not guaranteed. These statistics are not intended to represent the total number of properties sold in Ada County during the specified time period. The IMLS provides these statistics for purposes of general market analysis, but makes no representations as to the past or future appreciation or depreciation of property values. (To reduce the error, only data falling within 3 standard deviations from the mean has been included in the report. Existing and new construction statistics are calculated independently and may not sum to the total number of homes sold.) Changes to methodology: Effective 3/1/2007, ‘days on market’ refers to the number of days that transpire between the listing date and the date the property goes into pending status. Effective 4/1/2011, standard deviation is modified to reflect the difference between the asking and sold prices as a percentage of the asking price.

July 2015 Market Report: Higher home prices despite seasonal sales dip?

Compared to June 2015, single-family home prices in Ada County for July 2015 were up, while pending and closed sales were down. To some these sales counts prompted questions of a slowdown—but a seasonal slowdown is quite different than a market slowdown. Based on the recent trends and comparing them to historical performance, we’re not seeing a market slowdown at this time. Let’s take a look…

Seasonal Trends          Month-To-Month June 2015 July 2015 MTM % Chg
Pending Sales 1,359 1,319 -2.9%
Closed Sales 1,035* 1,007 -2.7%
Median Sales Price $230,000 $232,500 1.1%

 

* Adjusted for sales reported to IMLS after previous month’s market report was distributed.

Market Wide Trends     Year-Over-Year July 2014 July 2015 YOY % Chg
Pending Sales 988 1,319 33.5%
Closed Sales 837 1,007 20.3%
Median Sales Price $214,503 $232,500 8.4%

We’ve highlighted pending sales, since that metric is an indicator of future sales, as the homes under contract will likely close within the next 30-60 days. So while there may be a seasonal dip in pending sales of 2.9% from June to July, looking year-over-year, pending sales were 33.5% higher than the same time last year.

Market Snapshot_July1Yet after last month’s market report, showing peaks in prices and closed sales for Ada County, it’s easy to wonder whether we’re at the top of the market, or leaning towards a downturn. Brenda Kolsen, President of the Ada County Association of REALTORS®, responds: “As noted in our mid-year market report, our area typically sees a slight drop in activity each year in July or August, after the rush of the spring market, and as people take summer vacations and get ready for the new school year. Then we usually have another pop of activity in the fall. I expect we’ll see the same this year if economic conditions persist, and based on the number of inquiries our REALTOR® members are fielding every day, from people looking to buy and sell.”

The question of a market peak—or even another housing bubble—is also being asked nationally. Based on the economic trends tracked by the National Association of REALTORS® (NAR), that’s not likely. At an industry event held in Chicago on Monday, NAR’s Chief Economist Lawrence Yun explained that the national market is very different today than it was at the “bottom” in 2008 or 2009. Most notably because of the changes in credit/lending standards and housing inventory levels over the past few years.

Mortgage lenders now follow strict rules to qualify potential homebuyers, and many of the creative loan programs that were available back then are no longer in use. This has helped to diminish the risk of buyers getting into loans beyond their financial means. Paired with improving jobs numbers, we’re in a much better situation today, both financially and economically.

Additionally, the supply of homes nationwide is well below consumer demand, which is fueling the rise in prices. Locally, we’re definitely seeing the same thing, with supply at 2.5 months in July 2015 for all single-family inventory throughout Ada County. (A balanced market—not favoring buyers or sellers—is typically between 4.0-6.0 months of supply.)

“We will continue to watch local trends, especially pending sales and prices, to identify any irregularities that may emerge outside of our usual, seasonal peaks and valleys,” said Kolsen, “But in the meantime, I encourage any consumer who has questions or concerns about the market, to reach out to a REALTOR® to get the facts specific to their real estate situation.”

Here’s how the rest of July 2015 shaped up for single-family homes in Ada County:

  • Closed Sales were at 1,007, up 20.3% year-over-year, and up 19.2% year-to-date
  • Median Sales Price was at $232,500, up 8.4% year-over-year, and up 7.8% year-to-date
  • Days on Market was at 42 days, down 8.7% year-over-year, and down 5.5% year-to-date
  • Months of Inventory was at 2.5 months, down 30.6% year-over-year (number not tracked YTD)

 

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The Ada County Association of REALTORS® represents nearly 3,500 real estate professionals throughout the Boise region. For more information about the benefits of working with a REALTOR® and to search for a REALTOR® by name, language, or professional designation, visit http://myacar.com/find-a-realtor.

NOTE: The information in this market report is based on a variety of sources, but primarily on the public statistics provided by the Intermountain MLS (IMLS), a subsidiary of the Ada County Association of REALTORS®, available here: http://publicstats.intermountainmls.com/static/Reports/Ada/2015/July-2015-Ada.pdf. These statistics are based upon information secured by the agent from the owner or their representative. The accuracy of this information, while deemed reliable, has not been verified and is not guaranteed. These statistics are not intended to represent the total number of properties sold in Ada County during the specified time period. The IMLS provides these statistics for purposes of general market analysis, but makes no representations as to the past or future appreciation or depreciation of property values. (To reduce the error, only data falling within 3 standard deviations from the mean has been included in the report. Existing and new construction statistics are calculated independently and may not sum to the total number of homes sold.) Changes to methodology: Effective 3/1/2007, ‘days on market’ refers to the number of days that transpire between the listing date and the date the property goes into pending status. Effective 4/1/2011, standard deviation is modified to reflect the difference between the asking and sold prices as a percentage of the asking price.

June 2015 Market Report: Highest Number of Homes Sold in One Month Since 2006

Market Snapshot_JuneJune 2015 marked the highest number of homes sold and the highest sales volume in one month for single-family homes in Ada County, since June 2006.

While there have been a steady increases month-over-month (looking at the numbers over the past four years, based on records available), June 2015 topped them all with 1,028 single family home sales throughout Ada County. That was a year-over-year increase of 26.1%, and year-to-date, sales were up 18.6%. The total volume of single-family home sales in June 2015 was $279.5 million, which was a whopping 36.1% increase over June 2014, and a healthy 17.9% increase over May 2015.

Brenda Kolsen, 2015 President of the Ada County Association of REALTORS®, commented on the increases: “We typically see a run up in sales starting in the spring, through June and July. Then consumers take a quick break for vacations, before another burst of activity in the fall. This year is on a similar track, except for the enormous amount of activity that REALTORS® are handling every day.”

So what’s driving this demand? While we can’t point to one specific reason, gains in population and job growth across the state may be factors.

According to the U.S. Census Bureau data, Ada County’s population increased 8.6% between April 2010 and July 2014. Statewide the population increased 4.3%. Three groups seemed to be leading that growth, including Hispanic immigrants, recent retirees, and “midcareer” individuals and families. These last two groups were highlighted in a recent Idaho Statesmen article, noting departures from high-priced states like California, Washington, and Oregon, in exchange for Idaho’s lower cost of living and lifestyle opportunities. Additionally, the Idaho Department of Labor reported another month of year-over-year growth in jobs, up 2.5% in May 2015. Pairing job growth with improving Consumer Confidence scores, not only are people more comfortable purchasing a home, they may also be willing to spend a little more.

Stepping away from demographic and economic figures, back to local market statistics, here’s how the rest of June 2015 looked for Ada County real estate:

· 1,028 single-family homes sold, up 26.1% year-over-year
· $230,000 was the median sales price, up 6.0% year-over-year
· 2.6 months of inventory was available for sale, which was even with last year—inventory of existing homes as at 2.1 months and new construction was at 4.9 months in June 2015
· 42 days was the average market time, down 5 days, for a decrease of 36.2% year-over-year

2015 Mid-Year Market Update  (pdf)

NOTE: The information in this market report is based primarily on the public statistics provided by the Intermountain MLS (IMLS): http://publicstats.intermountainmls.com/static/Reports/Ada/2015/June-2015-Ada.pdf. These statistics are based upon information secured by the agent from the owner or their representative. The accuracy of this information, while deemed reliable, has not been verified and is not guaranteed. These statistics are not intended to represent the total number of properties sold in Ada County during the specified time period. The IMLS provides these statistics for purposes of general market analysis, but makes no representations as to the past or future appreciation or depreciation of property values. (To reduce the error, only data falling within 3 standard deviations from the mean has been included in the report. Existing and new construction statistics are calculated independently and may not sum to the total number of homes sold.) Changes to methodology: Effective 3/1/2007, ‘days on market’ refers to the number of days that transpire between the listing date and the date the property goes into pending status. Effective 4/1/2011, standard deviation is modified to reflect the difference between the asking and sold prices as a percentage of the asking price.

May Market Report: Opportunity for Move Up Buyers

Market Snapshot_MayLast month, we reported on trends that were driving housing demand across the country, as reported in the Economic and Housing Market Outlook from the National Association of REALTORS® and Chief Economist, Dr. Lawrence Yun. While many of these national trends are also present in Ada County, there is one area in which we differ—new construction.

Dr. Yun reported that housing starts nationally were well below the historical normal rate of 1.5 million per year, due primarily to the increasing costs of materials and labor. In many markets, this has contributed to the overall lack of inventory available for sale.

But according to the Building Contractors Association of Southwestern Idaho, residential new construction permits were up 10% in April 2015. They did note a slight 2% decrease in the Median Sales Price for May 2015. Looking at new construction data from the Intermountain MLS (IMLS), for May 2015 specifically in Ada County, we did see similar trends in price—the Median Sale Price of newly constructed homes in May 2015 was $296,900, compared to $301,038 in May of 2014, representing a 1.4% decrease year-over-year.

Additionally, the months of available inventory for newly constructed homes was at 5.9 months in May 2015. While this was a decrease compared to last year, it was considerably higher than the months of available inventory for existing homes, which was at 2.2 months in May 2015.

While slight price decreases and a higher supply of new homes may seem like cause for concern, it’s actually a great opportunity for move-up buyers.

Brenda Kolsen, 2015 President of the Ada County Association of REALTORS®, explains: “Throughout the spring market, we saw some buyers getting frustrated with the lack of inventory available, especially in the lower price points. But many owners weren’t ready to list because they didn’t want to be competing for homes, once theirs sold. But the message we’re sharing with prospective sellers, is that there are homes available, especially at higher price points and in new construction. And with rates still at historically low levels, we’re encouraging homeowners who have been thinking about selling, to meet with a REALTOR® now and review what’s possible in their situation.”

County-wide, here’s how the rest of May 2015 shaped up:

  • 901 single-family homes sold, up 14.5% year-over-year
  • Distressed properties (REOs and short sales) only accounted for 3% of the homes sold, down 50% compared to last year at this time
  • The Median Sales Price was $229,000, up 9.6% year-over-year
  • Available inventory was at 2.8 months, a decrease of 9.7% year-over-year (again, new construction supply was at 5.9 months, while the supply of existing homes was at 2.2 months)
  • Days on market was at 49, which was 2 days longer than last year, due to an increase in new construction market time, at 92 days in May 2015 compared to 76 days in May 2014

 

Notes: Based on information provided by the Intermountain MLS (IMLS). These statistics are based upon information secured by the agent fromthe owner or their representative. The accuracy of this information, while deemed reliable, has not been verified and is not guaranteed. These statistics are not intended to represent the total number of properties sold in Ada County during the specified time period. The IMLS provides these statistics for purposes of general market analysis, but makes no representations as to the past or future appreciation or depreciation of property values. (To reduce the error, only data falling within 3 standard deviations from the mean has been included in the report. Existing and new construction statistics are calculated independently and may not sum to the total number of homes sold.) * Effective 3/1/2007, ‘days on market’ refers to the number of days that transpire between the listing date and the date the property goes into pending status. Effective 4/1/2011, standard deviation is modified to reflect the difference between the asking and sold prices as a percentage of the asking price.

April Market Report: Disappearing Inventory

Market Snapshot_AprilThere were 803 single-family home sold in Ada County in April 2015, up 21% from this same time last year. The Median Home Price in April was at $216,200, which was also an increase over last year, by 3.2%. According to the National Association of REALTORS®, the low inventory of available homes, compared to the rising demand, is one of the key reasons that many markets are seeing these price increases — including Ada County.

The Months Supply of Inventory was at 3.1 months, which was a year-over-year decrease of 31% (down from 4.5 months in April 2014). A market is typically considered “balanced” between supply and demand when there is 4-6 months of inventory. The low supply has also driven down the Days on Market that sellers can expect. On average, homes sold within 50 days of being listed, which was a full week faster than last year at this time; a decrease of 12%.

Three other factors that have been driving demand, include — increased length of ownership, improved job growth, and increasing rental rates. This is according to a May 2015 Economic and Housing Market Outlook from the National Association of REALTORS® and Chief Economist, Dr. Lawrence Yun. More on these statistics:

  • Current homeowners are staying in their homes longer than in previous years – up to 10 years in 2014 vs. 6 years in 2008, nationwide.
  • Job growth is up and unemployment is down, meaning consumers are becoming more confident about their ability to buy and keep a home. Idaho was noted as being one of the best states for job growth over the past 12 months.
  • As rental vacancies drop and rental rates rise (now at a 7-year high, nationally), homeownership could become more desirable and possibly cheaper for some people, depending on mortgage rates and lending standards.

For more information on this national market outlook, download the entire presentation here: http://www.realtor.org/presentations/economic-and-housing-market-outlook. And check back in with ACAR next month for updated local numbers.

March Market Report- Starts off Strong

Market Snapshot_MarchMarch 2015 is the strongest March we’ve had since 2007. Single-family home sales in March 2015 were 694 in Ada County. YTD total sales are up 14% compared to this time last year; 1,630 homes sold compared to $1,425.

Days on Market for March were 65. That’s slightly down from February and we see it continue to hover around the same number the past few months.

New homes sold in March totaled 134; Existing home sales were 560.

March median home price was $222,000. Our YTD Median Price is $222,700.

New Homes Median Price for March was $282,402. Existing Home Median Price for March was $210,000.

Pending sales at the end of March were 1,208.

In Ada County we now have 3.6 months of inventory on hand, a very slight increase from February, but we can use it as we go into the Spring selling season.

March was strong in both sales and median home price, this should continue into the summer.

On the National level Existing-Home Sales spike in March. NAR Study: Boomerang Buyers Expected to Boost Housing Demand

Looks like we are gearing up for an interesting summer.

February Market Report- Has Spring Sprung?

Market Snapshot_FebruarySingle-family home sales in February 2015 were 507 in Ada County, an increase of 10.41% compared to February 2014.

Days on Market were 67, that is slightly down from 70 days last month.

New homes sold in February totaled 109; up 8.12% from last year.

Existing home sales were 398; up 11.11% from 2014.

February median home price was $224,900 with a 9.86% increase over 2014.

With continued increase over last year, Existing home price was $196,750 with 11.25% change.New home median price was $305,000 with a slight decrease of -1.45% from last year.

We had a very slight increase with months of inventory available 3.8 months of inventory. As we head toward spring and summer, we could use an increase in inventory.

February is typically our weakest month for median home price. February 2015 was pretty strong.  This should continue into the Summer.

Bottom line…it’s going to be a complicated first quarter for real estate.

January Market Report-Say Hello to 2015

Market Snapshot_JanuarySingle-family sales in January 2015 were 425 in Ada County, an increase of 1.67% compared to January 2014.

Dollar volume for January was up 9% to $107 million.

If you feel a slight deja vu that’s because Days on Market are at 70, same as January 2014. In December we were at 66.

New Homes Sold in January totaled 104; up 3% from last year. Existing Home Sales were 321; up from 1% from last year.

Pending sales at the end of January 867; up from January 2014.

January median home price was $223,900 up 8% from January 2014.

New Homes median home price for January was $313,773; up 13% from January 2014.

For Existing homes the increase is 4% to $198,000.

In Ada County we now have 3.7 months of inventory on hand. Up just a little from the end of December.

A look at National shows despite low inventory conditions, existing-home sales bounced back in December and climbed above an annual pace of 5 million sales for the sixth time in seven months.

December Market Report-That Was Fun

Single family home sales in December 2014 were 597 in Ada County, an increase of 3.5% compared to December 2013.  YTD total sales are down 2.5% compared to this time last year; 7,764 homes sold compared to 7,7,964.

Total dollar volume for December was $154M (up 8% over December 2013). Year-to-date dollar volume is $1.91B compared to $1.85B in 2013.

Consistent with the rest of 2014, sales of homes in December priced above $160,000 showed increases in every price category.

Average Days on Market in December were 66; nine more days than last month. In December 2013, Days on Market was 59.

New homes sold in December totaled 129; down 5% from last year.

Existing home sales were 468; up 6% from December 2013.

Historically December sales decrease from November levels by an average of 2%.   This year there was an increase of 11%.

Pending sales at the end of December were 712; up 4% compared to December 2013. Pending sales are our best “forward looking” indicator. December 2014 is the first month all year to have an increase in year-over-year “Pending Sales”….talk about a home run in the bottom of the ninth inning!

December median home price was $214,000; up 8% from December 2013. Our YTD median price is $210,000; up 6% over last year.

New Homes median price for December was $301,850; up 8% from December 2013. For Existing homes the increase is 6% to $194,600.

The number of houses available for sale at the end of December decreased 25% from November 2014 to 1,947. This is down slightly to last year.

As is typical this time of year, inventory contracted in all price categories for December.

Consistent what we’ve been observing regarding inventory, homes in the $120,000 – $160,000 shrank more than any other price point.

In Ada County we now have 3.5 months of inventory on hand, essentially unchanged from the end of July.

The price categories in shortest supply are $100,000 to $119,000 which has 1.3 months; and $120,000 – $159,000 which has 1.8 months.

From $200,000 to $400,000 we have 4 months available.

Of sales in December, the two strongest price points were $120,000 to $160,000; up 17% from November and $160,000 to $200,000; up 12%.

In the end, sales fell a little short of what we expected. We’re seeing the same picture nationwide. Because of the solid median price appreciation, dollar volume will be well ahead of last year.

November Market Report- Hoping for a Nice Christmas Present!

Market Snapshot_November2Single family home sales in November 2014 were 528 in Ada County, an decrease of 5% compared to November 2013.  YTD total sales are down 3% compared to this time last year; 7,155 homes sold compared to 7,387. Reluctantly, I’m going to have to recognize that total homes sold in 2014 will not exceed the number of homes sold in 2013.

On the other hand, total dollar volume for November was $139M (up 4% over November 2013). Year-to-date dollar volume is $1.75B compared to $1.72B in 2013.

Consistent with the rest of 2014, sales of homes in November priced above $160,000 showed increases in nearly every price category.

Average Days on Market in November were 57; two fewer days than last month. In November 2013, Days on Market was 52.

New homes sold in November totaled 103; down 3% from last year.

Existing home sales were 425; down 6% from November 2013.

Historically November sales decrease from October levels by an average of 9%.   This year there was an decrease of 19%; which is more consistent with the last three years.

Pending sales at the end of November were 827; even to November 2013. Pending sales are our best “forward looking” indicator. The last three months have shown a stronger “Pending Sales” picture.

November median home price was $215,319; up 5% from November 2013. Our YTD median price is $209,990; up 6% over last year.

New Homes median price for September was $295,095; up 7% from November 2013. For Existing homes the increase is 7% to $197,000.

The number of houses available for sale at the end of November decreased 13% from October 2014 to 2,591. This is even to last year.

As is typical this time of year, inventory contracted in all price categories for November.

Consistent what we’ve been observing regarding inventory, homes in the $120,000 – $160,000 shrank more than any other price point.

In Ada County we now have 3.8 months of inventory on hand, essentially unchanged from the end of July.

The price categories in shortest supply are $100,000 to $119,000 which has 1.4 months; and $120,000 – $159,000 which has 1.9 months.

From $200,000 to $400,000 we have 2 – 4 months available.

Of sales in November, the price point that held on to it’s summer pace was $300,000 – $400,000..downs 11%.

As it looks now, in Boise and the nation, sales in 2014 will not exceed 2013 in number of homes sold. Because of the solid median price appreciation, dollar volume will be well ahead of last year.

You will start to hear the media asking: “Is the recovery over?”

The answer to that is a resounding “No.”

Maybe you were at the Real Estate Summit yesterday to hear Dr. Lawrence Yun, Chief Economist for NAR give his reason for why 2015 will be another very solid year for real estate in Ada County.

One reason for his optimism was released in a report yesterday: “NAR Identifies Top Metro areas Poised for Uptick in Baby Boomer Sales”.

There we are…#2!