CAN WE HAVE AN ENCORE?
What a year! Having closed 19% more residential properties than last year in Ada County at an average price increase of 7%, we have to ask ourselves: can we have an encore?
Or, will 2016 SUPPLY us with an encore?
What would we need for an encore? First, and most importantly, we need more supply: especially more resale inventory. Notice in the graph below that we began the year with 1922 residential properties on the market, which grew to a high of 2495 properties by the end of July, then shrunk to 1784 properties by the end of December. The percentage improvement in unit sales over last year roughly coincided with the available inventory except in December when there was a rush to close sales before the beginning of 2016.
We began last year with 60 days of resale inventory but this year we have only 39 days of inventory. We’ll need more resale properties to satisfy buyer demand and to have a healthy market this year. The inventory problem can’t be answered by new home construction: first, because new homes are on average 38% more expensive than resale homes and, second, the inventory of new homes, at 5.9 months, is evenly balanced between supply and demand. A dramatic increase in the supply of new homes is likely to increase standing inventory, not sales.
Finally, we need the cooperation of interest rates. While they increased for part of 2014, they have come back down and low rates help create an affordable housing market. So far, so good. And will prices rise too much? See the graph below that shows the movement of average price and unit sales from 2002 through 2015. We’ve moved close to our 2007 high but resale properties still look like a bargain.
It will be interesting to see what happens in January 2016 and how that compares to January 2015. Stay tuned.
What’s for sure? This is a great time to sell your resale home. With low resale inventory, you should be able to sell your home and participate in a great market, both as a seller and, after your home is sold, as a buyer facing enticing interest rates and great affordability.
Welcome to real estate in 2016: bring on the resale homes and let’s have an encore in 2016!
Market Statistics Click on the links below to download the latest Market Statistics.
Market Statistics
Click on the links below to download the latest Market Statistics.
Legend
Market – These include homes of all ages and new construction.
Existing - This includes all homes older than 1 year and excludes new construction data.
New Construction - This includes new, to be built, and under construction homes.
Ada County Area Map
Canyon County Area Map
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Market |
Existing |
New Const |
| Ada County |
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| North Boise, 100 |
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| Northeast Boise, 200 |
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| Southeast Boise, 300 |
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| Boise Bench, 400 |
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| Southwest Boise, 500 |
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| SW Boise/Meridian, 550 |
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| West Boise, 600 |
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| West Boise/Meridian, 650 |
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| Garden City, 700 |
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| NW Boise/Garden City, 800 |
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| Eagle, 900 |
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| Star/Meridian, 950 |
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| Southeast Meridian, 1000 |
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| Southwest Meridian, 1010 |
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| Northeast Meridian, 1020 |
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| Northwest Meridian, 1030 |
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| Kuna, 1100 |
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| Canyon County |
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| Nampa (83687), 1250 |
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| Nampa (83686), 1260 |
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| Melba, 1265 |
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| Nampa (83651), 1270 |
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| NW Freeway, 1275 |
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| SW Freeway, 1280 |
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| Middleton, 1285 |
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| Canyon Other, 1290 |
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| Parma, 1292 |
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| Wilder, 1293 |
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| Greenleaf, 1294 |
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