Doing the Math….
I find myself thinking about few important facts about the Boise real estate market that trouble me.
- Inventory of Boise homes is up 48% year to date.
- Pending sales are down 15% from last month, and down 5% from same month last year.
- New Construction Pending sales are down 9% compared with same month last year, yet inventory over new homes is up 12% from last month.
- Housing Supply is still at a record lows, currently at 3 months for ada county, but that is up from 2.3 months just last month.
Based on what I am seeing in market, it appears to me that our housing supply in Ada county could possibly jump up to 5 or 6 months of inventory this fall/winter, which are numbers we haven’t seen since January 2011.
Does that mean the party’s over?
Not Really. 6 months of inventory is considered healthy. But I do believe that the market has been so hot that last 2 years that many agents, lenders, title companies, builders, etc are going to be caught off guard this fall and winter. Meaning it will be slower than they expect it to be, because they have been seduced into a false sense of market predictability after 6 months of red hot sales in the valley.
I by no means feel that the Boise market is going to be distressed again or slide backwards, but I do feel that industry professional have gotten used to selling homes in a low inventory market. Now the game is changing more back to normal. Normal is ok with me. Because we are used to marketing hard to sell homes (like million dollar properties). I do the same marketing tactics for a $300,000 home as I do for a 1.3 million dollar home, which is try to crush-it online. It’s working too, my listings are getting 10x more hits then competing listings right next door! More exposure, and more visibility on a home for sale = much higher odds of selling at our target price.
The fall/winter slow down will catch a lot of people off guard, and will cause some negative news in the media. So here is your official heads up…
Article by: Mike Turner – Boise Real Estate Agent at Front Street Brokers: Contact at 208-740-5000 or mike@nullFrontStreetBrokers.com