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DEMAND FOR ADA COUNTY HOMES DRIVES PRICES TO NEW RECORD!

DEMAND FOR ADA COUNTY HOMES DRIVES PRICES TO NEW RECORD

This Information is Provided By The Boise Regional Realtors, November 2019

Key Takeaways:
Pending sales reached 1,460 in November 2019, up 20.6% compared to November 2018, showing a notable increase in demand for homes compared to last year.
This demand for housing, coupled with low inventory, drove the median sales price to a new record of $359,900 in November 2019, up 12.5% over the same month last year.
New construction sales made up 32.2% of the market share in November. New homes typically sell for more than existing homes due to the increasing costs of land, materials, shortage of skilled labor, as well as consumer preferences. More inventory, whether existing or new construction, is needed at all price points, but especially
those below $250,000, to help bring our market back into balance.

Analysis:
We may sound like a broken record, but the lack of housing supply versus persistent and increasing demand for housing continues to drive home prices in Ada County. Pending sales, or homes under contract that should close within 30-90 days, reached 1,460 in November 2019, up 20.6% compared to November 2018. This is a notable increase in demand for homes compared to what we saw last year, with 1,211 pending sales in November 2018.

This increased demand was coupled with low inventory, which drove the median sales price to a new record of $359,900 in November 2019, up 12.5% over the same month last year. Looking at activity between January and November 2019, the year-to-date median sales price came in at $345,000 in November 2019, a bit more modest than the monthly median for November 2019, but still a gain of 10.5% when compared to the same time frame last year.

While demand for housing and lack of inventory are clear factors impacting home prices in Ada County, as new construction sales gain more and more of the market share, the segment continues to influence the overall median sales price. New construction sales made up 32.2% of the market share in November, a 11.9% increase when compared to November 2018. New construction median sales prices are typically higher than existing homes median sales prices, due to the increasing costs of land, materials, shortage of skilled labor, as well as consumer preferences. The median sales price for new homes also hit a new record in November at $439,849, a 13.1% increase from the year before.

While low mortgage rates are helpful for buyers, what we really need is more inventory at lower price points to give home buyers more options. If you’re ready to sell, there is plenty of demand for housing and no need to wait until spring to list. The same applies to new construction — if builders and developers are able to build at lower price points, the market and buyers would gladly welcome additional inventory.

While REALTORS® are not advocating for more rooftops anywhere and everywhere, BRR is committed to supporting comprehensive, regional planned growth, that offers adequate purchase and rental options in all price points — not only to stabilize the market but to preserve and improve the quality of life for all residents. If you’re looking to buy and are concerned about affordability, work with your REALTOR® to explore the programs and options available to you.