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Wednesday, January 27, 2016

Take My Breath Away Winner

This is an occasional pictorial of homes that have grabbed my attention due to their paint selections. This home may not have left me gasping for breath, but made me look never the less.



I owned a yellow house once, was it really this bright?

Monday, January 25, 2016

Cautious Optimism for Real Estate in 2016

Looking ahead to 2016, the National Association of REALTORS® (NAR) released their forecast, which can be described as “cautiously optimistic.” Chief Economist Lawrence Yun noted that the year hasn’t started out quite as strong as was expected because of a contraction in the manufacturing sector. This means that other sectors like real estate must perform well to continue economic growth.

Locally there was good news on this front… a recently released report from the State of Idaho’s Joint Legislative Economic Outlook and Revenue Assessment Committee shows the impact that real estate has had on Idaho’s Gross State Product (GSP) between 2004 and 2014. It notes that real estate was the fastest growing segment—up $3.6 billion over the 10-year period—and surpassed manufacturing to become the largest private segment in Idaho’s economy. Idaho businesses operating in the “Real Estate, Rental, and Leasing” segment generated $8.5 billion, which was 13.5% of GSP. Based on these figures, and the Total Dollar Volume noted earlier in this report, we can estimate that residential real estate in Ada County accounted for 22.4% of GSP in 2014.

Back to national trends, despite the slower economic growth that started 2016, NAR expects home sales to grow by 1-3%. Additionally, they expect prices to grow around 3-5% due to new construction housing shortages in many markets. But as noted earlier, here in Ada County, we have a balanced new construction market and need inventory growth among existing homes.

CoreLogic reported that Idaho was fourth in the nation for price appreciation last year—up 8.5% compared to 2014—based on activity through November 2015. The top five states were as follows: Colorado with 10.4% price appreciation year-over-year, followed by Washington at 10.2%, Oregon at 9.0%, Idaho at 8.5%, and Florida at 7.9%. CoreLogic estimates price appreciation in 2016 of about 3.9% for the state overall, and ACAR will be watching how that trend plays out in and around the Boise region throughout the year.

As noted, mortgage rates are expected to go up throughout the year, and likely into 2017. Even though they’ll still be historically low, NAR notes that the rule of thumb is that a 1% rise in mortgage rates translates to 10% reduction in purchasing power. This is another reason the pace of price appreciation will slow down compared to last year.

Finally, NAR will be watching job numbers throughout 2016, as they are a leading indicator of housing demand. Last year, NAR ranked Idaho as #2 in the country for job growth, up 3.2% year-over-year. ACAR will continue to support groups like the Boise Valley Economic Partnership and others, who work to attract companies and bring jobs to the state, and especially to the Boise region.

Last year was a great year and my 2016 has already started very strong. Give me a call or send me an email to assist you in buying or selling this year. Thanks Roger

 

Sunday, January 24, 2016

Residential Real Estate 2015 Report for Ada County, 4th Installment

This is the 4th and final installment of the 2015 Residential Real Estate Report for Ada County, tomorrow we will look ahead at 2016. (Courtesy of the Ada County Association of Realtors.)

Mortgage Rate Increases Haven’t Deterred Buyers

After the Federal Reserve announced they would raise the interest rate at the end of last year, it caused concern that mortgage rates would soon follow. Economists were quick to remind everyone that many factors determine where mortgage rates go, in addition to the federal interest rate. Case in point, days after the interest rate increase was announced, mortgage rates moved north of 4% and then dipped back below that mark at the start of January.

However, REALTOR.com recently reported that it expects 30-year fixed rates to “end 2016 about 60 basis points higher than they are [now, and note] that level of increase is manageable, as consumers will have multiple tactics to mitigate some of that increase.”

This is especially true for buyers at lower price points. While they may see some impact to their monthly mortgage payments, it shouldn’t make purchasing a home in 2016 unaffordable or unattainable.

There were 964 pending sales in December 2015, up 35.4% compared to December 2014. This bodes well for closed sales figures in the first quarter of 2016 since the pending sales metric is an indicator of future sales, as the homes under contract will likely close within the next 30-60 days.



“The growth in pending sales shows that home buyers were not deterred by the news of a rate change,” said ACAR’s President, Carey Farmer. “I’m certainly seeing that with my own clients, as they continue to shop for homes and write offers.”

Saturday, January 23, 2016

Residential Real Estate Report for 2015 Ada County Cont.

This is the 3rd installment of the 2015 Residential Real Estate Report for Ada County, courtesy of the Ada County Association of Realtors.

Population Growth is Fueling Housing Demand

Population growth across the state has been the main driver behind the demand for more housing. The Idaho Statesman reported that the state’s population grew by 1.2% from mid-2014 and mid-2015 making it the 12th strongest increase in the U.S. This was caused by a high birth rate and domestic migration—people moving into Idaho from other states. Obviously babies aren’t buying homes, but family expansion is a key reason why people decide to purchase a home. Looking at domestic migration, the Boise Valley Economic Partnership (BVEP) provided these stats in a presentation to ACAR:



Comparing these figures to the consumer traffic on intermountainmls.com, indicates that this domestic migration should continue throughout 2016. Web traffic came primarily from these cities (in order): Boise, Salt Lake City, Meridian, Twin Falls, Nampa, Eagle, Los Angeles, Caldwell, Denver, and San Francisco. Sessions from Los Angeles grew the most compared to last year, up 180%. Overall, year-over-year trends for users and sessions were up over 13% each, and page views were up by 39%.

These population trends don’t seem to be slowing down, and may be compounded by more Millennials becoming homeowners in 2016. Looking at another statistic from BVEP, 72% of those moving to Idaho were under the age of 50, and a large portion of those people were 21-40 years old, capturing some in Generation X and many in the Millennial Generation.



According to REALTOR.com, “Millennials emerged as a dominant force in 2015, representing almost 2 million sales, [and REALTOR.com expects this pattern to] continue in 2016… Two other generations will also affect the market in 2016: financially recovering Gen Xers and older Boomers thinking about or entering retirement. Since most of these people are already homeowners, they’ll play a double role, boosting the market as both sellers and buyers. Gen Xers are in their prime earning years and thus able to relocate to better neighborhoods for their families. Older Boomers are approaching (or already in) retirement and seeking to downsize and lock in a lower cost of living. Together, these two generations will provide much of the suburban inventory that Millennials desire to start their own families.” As noted earlier, that inventory from existing homeowners is definitely needed in our market.

 

Friday, January 22, 2016

Ada County Real Estate Report for 2015 Continued

As prices and volume returned to pre-downturn levels, the question of a market peak—or even another housing bubble—came up frequently last year. Based on the trends tracked by the National Association of REALTORS® (NAR), Chief Economist Lawrence Yun explained that the market today is very different than it was at the bottom (around 2009 nationally, and 2011 for Ada County) mostly because of the changes in mortgage lending and the decreasing numbers of homes for sale.

Mortgage lenders now follow stricter rules to qualify potential homebuyers, and many of the creative loan programs that were available before are no longer in use. This has helped diminish the risk of buyers getting into loans beyond their financial means, which caused many to lose their homes to foreclosure. Paired with improving jobs reports, we’re in a much better situation today, both financially and economically.

The supply of homes for sale has been well below consumer demand, nationally and in Ada County. The following charts illustrate the change in local inventory before, during, and after the downturn:





Overall inventory has been dropping due to the lack of existing homes being listed. Carey Farmer, President of the Ada County Association of REALTORS® and Associate Broker at Group One Real Estate, explains:

“We hope more homeowners will be in a position to sell in 2016, having regained equity after the downturn. I’ve talked with some potential sellers who are concerned that they won’t be able to find a home once they sell theirs. While it’s true we need more existinginventory to come online, our market actually has a good supply of newly constructedhomes, which is not common across the country. New construction is a great option for those looking to move up in price point, square footage, or amenities.”



The “months supply of inventory” metric is a great way to gauge supply and demand, by taking the number of homes for sale at the end of a given month, then dividing that by the average number of closed sales by month, over the preceding twelve months. The result could be interpreted as the number of months it would take to sell through the current inventory if no other homes were listed. A balanced market—not favoring buyers or sellers—is typically between 4-6 months of supply. Based on the chart above, the buyer demand for existing homes is outpacing the supply, while new construction supply is on track with demand.

 

Thanks to the Ada County Association of Realtors

Thursday, January 21, 2016

2015 Residential Real Estate Market Report for Ada County

These statistics are courtesy of the Ada County Association of Realtors

I will be including some additional data over the next few days.

Report Highlights

  • Total dollar volume sold surpassed the $2 billion-mark for the first time since 2006.

  • Idaho was one of the top states for price appreciation and job growth in 2015.

  • Low inventory coupled with population growth is driving prices and demand.

  • Domestic migration from neighboring states—especially California—should continue in 2016.

  • Affordability looks favorable despite potential mortgage rate increases.

  • 2016 national real estate market met with “cautious optimism” by NAR.


 

2015 Residential Market Trends

2015 was another great year for real estate in Ada County. From January 1–December 31, there were 9,284 single-family homes sold, up 19.3% compared to the previous twelve month period. The growth was primarily driven by activity among existing homes, up 20.3% compared to the previous twelve month period.

 



The median sales price of all single-family homes continued to rise, ending the year at $229,000, up 9.0% compared to the previous twelve month period. The median sales price for existing homes was at $213,000, an increase of 10.1% over last year—and welcome news for homeowners. The median sales price for new construction increased by 4.7% to end the year at $313,900.



This combination of sales activity and price brought the total dollar volume of homes sold to $2.45 billion. This was up an impressive 28.2% compared to 2014, and an increase of 32.0% over 2013. The last time volume went above the $2 billion-mark was 2006, which had a total dollar volume sold of $2.66 billion

Wednesday, January 13, 2016

Ada County December Market Report

From the Ada County Association of Realtors


December 2015 Market Report: Home Prices and Sales Up Despite Rates; Inventory Still Way Down


January 12, 2016 by  · Leave a Comment

In December 2015, the median sales price of all single-family homes in Ada County, as tracked by the Intermountain MLS, was at $232,500, up 8.4% compared to December 2014. The median sales price of existing single-family homes was $208,975, up 7.2% year-over-year, and the new construction median sales price was $323,813, up 7.6% year-over-year.

There were 785 closed sales in December 2015, up 28.5% over the same month last year. This brought the total dollar volume sold last month was $210.1 million, up 34.1% compared to last year.

After the Federal Reserve announced they would raise the interest rate at the end of last year, it caused concern that mortgage rates would soon follow. Economists were quick to remind everyone that there are many factors that determine where mortgage rates go, in addition to the federal interest rate. Case in point, days after the interest rate increase was announced, mortgage rates moved north of 4%, then dipped back below that mark at the start of January.

In a recent article, REALTOR.com said it expects 30-year fixed rates to “end 2016 about 60 basis points higher than they are [now, and note] that level of increase is manageable, as consumers will have multiple tactics to mitigate some of that increase.” This is especially true for buyers at lower price points. While they may see some impact to their monthly mortgage payments, it shouldn’t make purchasing in 2016 unaffordable.

There were 964 pending sales in December 2015, up 35.4% compared to December 2014, which bodes well for closed sales figures in the first quarter of 2016. “The growth in pending sales shows that home buyers were not deterred by the news of a rate change,” said Carey Farmer, 2016 President of the Ada County Association of REALTORS®. “I’m certainly seeing that with my own clients, as they continue to shop for homes and write offers. The bigger concern is the continued lack of inventory.”

In December 2015, the months supply of inventory for all single-family homes in Ada County was at 2.5 months, down 28.6% from last year. New construction was at 5.3 months of supply, down 26.4% from last year, while existing homes were only at 1.7 months of supply, down 32.0%. (A balanced market—not favoring buyers or sellers—is typically between 4-6 months of supply.)

“This time of year people think they must wait for the ‘spring market’ to list their homes. However, I have spoken with many homeowners who are in a great position to list now, and who want to sell now, and in doing so will get in front of buyers who are desperate for more inventory,” said Farmer, who is a REALTOR® with Group One in Eagle. “Buyer demand is there, we just need more homes to show them.”


 

Tuesday, January 12, 2016

It is a New Year!

We are already a couple of weeks into the new year. Personally, although the overall activity is low, as is traditional for this time of year, I have had 4 properties accept offers since the first of the year. And of those 4, 3 of them were listed either in December or earlier in January. So I guess I would have to say the the market is still moving, people are still listing and buyers still buying.

I was going to post some photos of a couple of those listings, but with them already pending, I will post a couple newly listed from this week.

The first is a two story home in Kuna, very nice condition with a 3 car garage, large kitchen, lots of light, 2159 square feet and priced at only $174,900. MLS#98608554



Great Value on this Kuna home!



I will have to wait to post photos of my next listing, it is so new I do not have them yet. It is a new construction, 3300 square feet with view from the northwest foothills of Boise. Priced at $899,000. Look for those photos in the next few days. Or you can call me now to get the first look!