Thursday
Mar062014

Then and Now

Do you remember what it was like in Idaho back in 2006?  It was a much gentler time, but Idaho was making headlines even back then.  Our distinct four seasons that accommodate year round recreational opportunities, low crime rate, low cost of living, good tech jobs and robust agriculture offered a great place to raise a family.  The secret was out and there was a housing boom that was sweeping the nation.  We saw an influx of families moving to the Treasure Valley and overnight throwing Idaho’s housing market into overdrive!

We thought it would be interesting to share a comparison of then and now to give you an idea of how Idaho’s current housing market is really doing.  Comparing 11 key categories from July 2006 and July 2013, gives a clear picture of just how far we’ve come since the market bottomed in 2008. 

Take a look at the following stats from Ada County:

 

July 2006

Ada County Stats

July 2013

Difference

4,087

Total Active Residential Listings

2,369

1718

917

Total Single Family Homes Sold

883

34

$279,391

Average Price

$239,194

$40,197

25

Days on Market

44

19

$256,201,859

Total Dollar Volume Sold

$211,208,286

$44,993,573

2,346

Existing Residential Listings

1,796

550

593

Existing Homes Sold

718

125

$261,896

Average Price of Existing Homes Sold

$229,680

32,216

1,741

Newly Constructed Residential Listings

573

1,168

324

Newly Constructed Homes Sold

165

159

$312,045

Average Price of New Homes Sold

$280,596

$31,449

 

It is evident from the table above that the total active listings are 43 % less than what they were in 2006.  This is what is termed as our “inventory”, what is listed for sale.  But, look at the total number of single family homes that sold.  We are only off by 34 units.  It’s economics 101, the law of supply and demand. 

Our low inventory levels, coupled with the high demand for single family homes are what are driving housing prices higher.  Add to that the following:

All of these factors will continue to drive housing prices up.  Experts do not expect to see the same housing prices we saw in 2006, but it sure looks like we are not too far off.  Right now we have a mixed market (buyer and seller’s) in Idaho.  If this trend of low inventory continues, we could very well see the market moving towards a seller’s market.

One thing is for certain.  2014 will be a very interesting year for Idaho’s housing market.  If interest rates remain low, and word on the street is they will, you can expect new home construction to really take off.  If you’ve had a hard time finding your perfect home, it just might be the most opportune time to start the building process and find yourself a reputable builder!

Thursday
Mar062014

Buying vs. Building

Buying vs. Building

Idaho is enjoying one of the most rapidly rebounding economies in the United State and its real estate market is a major contributor to that trend.  Experts have predicted a healthy and robust real estate market for 2014.  But, with home prices rising a whopping 34 percent since January 2012, and a frenzy of home buying activity to go along with that, we are seeing some of the lowest housing inventory levels in decades. 

This type of activity and low inventory has led to a shortage of median priced homes in the Treasure Valley.  It is becoming the norm to have multiple offers on listings below the $200,000 price range in just a matter of a few days of the listing becoming active.  It is safe to say that demand is much greater than the supply.  This scenario is leaving home buyers with few options when it comes to finding their “perfect” home. 

An alternative to buying is building new and there are some excellent benefits to building a new home.   A new home can be customized to your exact specifications.  And, with the recent rise in housing prices, building new really isn’t that much more expensive when you actually look at the big picture and compare the two. 

Let’s examine some of the key factors to be considered when purchasing or building a home: 

Energy Efficiency

Energy costs have risen year after year and new technologies are continually being produced to combat the high cost of electricity, natural gas, and water consumption.  New homes and custom built homes employ the latest energy efficient designs, materials and technologies versus an older home built in the 80’s and 90’s.  

Newly constructed homes use energy more efficiently in two ways; First, they tend to have a tighter-sealed “building envelope”.  This means the enclosed part of the structure is better equipped to keep conditioned air and warm air from escaping the home.  This is achieved through higher R-factor insulation requirements, better windows, and Tyvek house wrap.  Second, the mechanical equipment used to heat and cool the interior of the home, and water heaters, and appliances are all high efficiency rated and contribute to less energy consumption. 

A new, energy efficient home will compliment your household budget every month.  Older homes, while charming and full of character will demand more energy usage.  You might consider energy-efficient upgrades for an existing house, but these types of home improvements can be costly. 

Interior Design & Livability

When you buy an existing home, you inherit the current color palette, light fixtures, floor coverings, counter tops and over-all design of the home.  For example, older home architects and builders spent little time designing floor plans to maximize traffic flow for family rooms near kitchens.  These older floor plans usually featured multiple segmented rooms and long, narrow hallways making the home obsolete for aging in place or accommodating people with special needs (such as wheelchairs, walkers and grab bars).  

It is important to think about your lifestyle and how you live in your home.  Are you an active family with multiple sports enthusiasts?  Then you might want a home with a mud room, larger closet and storage space to hold sporting equipment.  Older homes rarely offer these amenities and the cost to bring the interior design current can be quite expensive. 

Deferred Maintenance

When purchasing an existing home and depending on the age of the home, you can expect a certain amount of maintenance and repair will be necessary.  Every component of a home has a life span and will wear out eventually, even with the upmost care and maintenance.  However, with a newly built home, you can be quite comfortable knowing that you will not need a new roof, heating system or an expensive plumbing or electrical overhaul anytime soon.  Should a system bring problems in a brand new home, the warranty will cover any re-installs.  

There are still some great deals to be had on existing homes for sale.  Be sure to do your homework before you purchase and always get a home inspection before you make an offer.  Make a list of pro’s and con’s of the home and take into account how you and your family will actually live in the home.  If it’s going to take a lot to remodel the home to fit your family’s needs, maybe building a new home is a much better solution and it’s such a nice feeling moving into your brand new, never lived in home!

Thursday
Mar062014

From the Builder: Making Headlines!

Greetings!

Here we are, well into the first quarter of 2014 and early housing reports are saying we should expect good things for Southwestern Idaho and the Treasure Valley area housing markets.  As Boise continues to make the “Top 10” lists for a variety of reasons and our local economy is recognized as one of the top five leading the national recovery, experts predict a very robust 2014 is in store for us! 

Take for instance the numerous top 10 lists the Boise area has appeared in recently:  RE/MAX listed the Boise Real Estate market has having THE highest sales increase in the nation.  Forbes listed Boise as one of the fastest growing cities AND one of the top cities to retire in 2014.  And, let’s not forget to mention that our unemployment rate has been steadily decreasing and has landed Idaho with a 15th lowest unemployment rate in the nation with a rate of 5.7%.

With all the recent buzz about our great state, there are still a few caveats.  Some of then will drive home values higher and some will make it difficult for new construction type projects.  Land and available lots are in short supply.  Low inventory is holding back sales while at the same time pushing up home prices.  More new home construction is needed to help relieve the inventory pressure and moderate price gains. 

What does this mean?  It’s a mixed market with mostly good news.  Folks who were underwater in their mortgages are finally seeing appreciation in their property value.  If they have needed to sell in order to upgrade or purchase a larger home, they can finally do it without losing money.  However, with inventory so low, finding that “perfect home” has become more difficult.  This leaves many homebuyers with their only option to build new.  But, with land and lots in short supply, many homebuyers are having a difficult time finding suitable land or a lot in the area they desire. 

The good news is that we are not in another “bubble” but demand is on the rise.  We will continue to see property values appreciate in 2014; Also, with interest rates still low and home values increasing, it is both a buyer and seller’s market! 

Jeff

Tuesday
Jun042013

Creating an Outdoor Oasis

Warmer days are on their way and creating that perfect oasis in your outdoor living space will make those warmer days feel like a mini-vacation.  Here are some ideas to help you achieve a Zen like space in your own back yard! 

Create a Living Room Outdoors

Bring your home and your life outdoors by creating little living rooms on porches and patios. Arrange seating as you would in a family room to encourage gathering for good conversation and relaxation. Use comfortable cushions and pillows covered in outdoor fabric liberally, and your outdoor space will become the most popular room outside of the house.

Create an Instant Party Spot

A simple string of party lights brings something special to your backyard; whether you’re enjoying a weeknight meal out back, or hosting a dinner party. Outline the edge,  add refreshments, some friends, and you’ve got yourself a party. 

Insta-Garden

So you still haven’t gotten around to planting that hydrangea bush? No worries. Create an instant garden using containers. Planters in all different shapes, sizes, and colors are the perfect antidote to a colorless, flowerless garden. 

Cabana Cool

Add fabric panels to an arbor or pergola to create your own personal cabana. Low to the ground, lounge-like furniture covered in sumptuous outdoor fabrics and large floor cushions add to the Zen, relaxed vibe of a poolside cabana. 

Outdoor Dining

If you grill at least twice a week from spring through fall, and if you love eating outdoors, you need an outdoor kitchen.

You don't need a fancy grill. A countertop for food prep and conveniences such as closed storage and a separate side burner will greatly enhance your outdoor cooking experience. Add a refrigerator and sink to make preparation and cleanup even easier. 

How About a Little Privacy?

Your outdoor room will feel more like an oasis if it has a sense of enclosure. Fences and garden walls ensure privacy for patios, but you can also use lattice, pergolas, and landscaping to define outdoor spaces and screen views of neighboring houses. 

Shed a Little Light on the Subject

To enjoy your backyard getaway after the sun sets, include outdoor lighting. At its most basic, this consists of porch lights that illuminate access to the house and provide ambient lighting. 

For outdoor kitchens, you'll need good task lighting over the grill and work areas. For the dining and conversation areas, candlelight, wall-mounted down-lights, or dimmable electric lamps create a relaxed mood. Steps and walkways should be illuminated for safety. 

You can also use solar-powered accent lights or low-voltage lights to add drama and interest to the landscape and to highlight paths. Combine a mix of lighting sources to make your backyard getaway a magical place after dark. 

These touches and many others will turn an ordinary patio or deck into a welcoming, personal space for outdoor living.

Tuesday
Mar262013

What to Expect for Idaho's Housing Market in 2013: 

In the ever changing world of real estate, the market ebbs and flows.  Sometimes it’s an all out flood and on the rare occasion, you can experience one of the worst droughts in history.  If you are like most folks here in the Treasure Valley, you've likely noticed how Boise, Idaho real estate has been dramatically changing over the course of 2012 and into 2013.  Fewer foreclosures, shrinking inventories of homes, and rising house prices have all played a significant role in the turnaround we have seen recently.  We are seeing much of the same occurring throughout many of our nation's real estate markets.  We have seen the shift from a buyer’s market and are now finally experiencing a seller’s market.  This means if you are looking to purchase a new home, you will need to be more prepared than ever before!

As a home buyer in today’s economy, you need to have a real solid understanding of the things you want and need in a home before actively searching.  This is a key component before you even begin looking at homes or decide to build.  Understanding this concept between wants and needs is the most beneficial knowledge you will use towards finding your dream home.  

The hot topic in real estate for 2013 so far, has been low inventory.  Boise, Idaho is no exception when it comes to inventory shortfalls.  Boise has been involved in the same shortages of available listings as many of the nation's most desirable markets, solidifying the shift from a buyer's market to a seller's market.

Reports from the National Association of Realtors indicate that the number of homes for sale is now at its lowest level in over 13 years. With an increasing inventory crunch as we head into the busy spring selling season, it's time to gear up with the tools necessary to succeed at finding your dream home in Boise, Idaho. This means that in addition to being financially ready to move forward, you need to be mentally prepared for a market with increased competition. While it's always been true regardless of market conditions to be financially prepared, buyers in 2013 now more than ever, need to have a mortgage approval in place before they enter the market to buy a home.

In a seller's market, sellers won't accept an offer without a mortgage approval letter attached-especially if they have other offers that do have mortgage approvals attached. We're entering the season where sellers can expect to receive multiple offers, resulting in a bidding war.  If a buyer wants the advantage, they will have pre-arranged financing securely in place.

Lending conditions in 2013 have also changed. With restrictions that seem to be only getting tighter and tighter, buyers need to be fully aware of their credit scores. Prospective buyers should check their credit score as soon as they are thinking about buying, because fixing even a minor credit issue can take 60 to 120 days to correct.  With the average FICO score for an approved conventional loan at 764 in November 2012, and the average credit score of a denied conventional loan at 736, the margin for errors on your credit report is minuscule at best. Monitor your credit carefully!

Tighter lending standards also mean potential buyers need to be even more prepared as they head into the mortgage approval process. Buyers need to get geared up with extensive financial documentation such as pay stubs, tax returns, bank statements, asset statements and more. In addition to submitting these forms to the lender and working through the pre-approval process, buyers will also need to estimate what the total cash requirement is to make the home purchase. Costs such as the earnest money deposit, down payment, home inspection and appraisal, as well as lender fees, are all an inescapable part of the equation when it comes to home ownership. It's vital that buyers know what they can afford and how to move that into a monthly payment.

A home has both its traditional value as reported by an appraiser, as well as the value buyers place on a personal level by what qualities and advantages the home possesses for their individual needs. Buyers should be prepared to find the home that will fulfill their needs on a long term basis. Is the home located near a quality school district? Does it have quick access to public transportation and other amenities? All these things and more can make a home more or less appealing to a variety of buyers with different needs.  Also, when a buyer knows exactly what they're looking for, they'll be more likely to find it.

As mentioned earlier, buyers need to know exactly what they want and need in a home before they embark on an active house hunt. With declining inventory numbers and increased demand, buyers who spot a home that fits the items on their wish list need to be prepared to move quickly. Experts recommend moving fast in markets with lower inventory.  With today's low interest rates and higher buyer affordability, the time to move is now-especially as we prepare for the spring frenzy!

 

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