As spring is almost here, the real estate market is about to reach its busiest time of year. To be honest, it didn't really slow down at all over the winter like it usually does due to the historically low interest rates we're seeing so I'm curious to
see just how much busier it can get. Boise Regional Realtors just recently put out its report for 2020, and I'd like to go over some of the key points with you to keep you updated on what to expect in today's market. Let's dive right in...I want to start
with this graphic.
Since the majority of my clients are looking for property in Ada County, I'm going to focus my attention there. Canyon County is seeing very similar market conditions, so if you're looking in Nampa or Caldwell, this information will apply as well.
The most shocking figure that sticks out to me is the 24.3% appreciation rate we saw in 2020. I was expecting a good 15-18%, but an appreciation rate that high surprised me--even though it's not unwarranted. The most common comment I've been getting
from potential buyers is that they wish they would have bought a couple years ago and wouldn't have waited. Most economists and industry professionals are predicting similar appreciation rates for 2021 and 2022. I don't think that's too far off and
would anticipate seeing an appreciation rate of near 15% in 2022 simply due to the high demand for property in our specific area.
We can't talk about 2020 without addressing the impact that COVID-19 had on the real estate market. The year started strong with January 2020 sales already 21.5% higher than in January 2019, but sales began to taper off in late February and March
once people realized how serious things could get for everyone. We saw a temporary slow-down, but in June sales started to pick back up and increased 22% year-over-year in July and remained elevated through November. What that means in that we essentially
crammed a year's worth of activity into just 6 months. Agents were quick to adapt and quickly adopted virtual technology to help buyers feel at ease--using virtual tours, creating videos, and relying heavily on social media marketing.
As you can see, interest rates today are the lowest ever
by using data going all the way back to 1971. These low interest rates increased the purchasing power for buyers,
allowing them to buy despite rising prices, and in some cases, compete in multiple offer situations where they might not have been able to before.
A major factor that pushed home prices up was insufficient supply compared to demand--especially for existing inventory. For most of 2020, the average number of days on the market for existing homes was 20 days...Then in October, that number dropped
to just 13 days (a record low based on data going back to 2004). In reality, homes are selling quicker than that. In today's market, most homes are selling in 4 days or less with multiple offers. The drop in average from 20 days on the market
to just 13 days means that buyers have had to act quickly and write a competitive offer when they found a home they liked and wanted to purchase.
As you'll see below, the average number of Days on Market is decreasing over time while the Median Sales Price is increasing.
On the last day of December 2020, there were only 333 homes available for sale in ALL of Ada County! 333. That's it...at all price points. That's 79.6% lower than in December 2019. We need more inventory in order to bring back balance to the market.
Because interest rates are so low, people are refinancing their homes at a higher rate, leading to less homes being on the market. Where traditionally, people would "trade up" every few years, a lot of homeowners are choosing to refinance and
use their equity to update their homes instead of purchasing a new home that better suits their needs.
A lot of people being able to work from home/work from anywhere has allowed more people to relocate to Idaho and keep their current jobs. It's no secret that Idaho has been one of the top states experiencing growth over the past few years, and
the ability for many to work from anywhere brought more interest than ever, equating to even more demand for homes in our market.
A fast, competitive market like ours presents challenges and opportunities to buyers and sellers alike. Whether you're looking to buy or sell, it's never been more important to work with an agent. I can help you identify potential options for
purchase, connect you with a mortgage lender, help craft a competitive offer, and negotiate on your behalf--allowing you to make decisions confidently and quickly to achieve your real estate goals.
If you're curious what your current home is worth in today's market and want me to put together a report, just shoot me your address and I'll prepare something for you right away. If you're considering buying and want to talk about your options
or come up with a game plan to be as competitive with your offer as you can, I'm available for buyer consultations as well. My personal cell is 208-921-3774
I hope 2021 treats you well! I'm always here if and when you need me.
All the Best,