At the height of the pandemic housing frenzy, Boise was not just discovered. It was flooded with buyers.
That’s when housing market hawks first locked on to the Idaho metro for its eye-popping price increases. Since then, fascination with Boise has persisted — but now as the U.S. housing market has tipped into recession territory amid higher mortgage rates, some days hovering near 7%, there’s a new obsession with Boise.
It was first to the party. Now, as sales stall, inventory levels explode and prices begin to taper, Boise appears to be among the first to the hangover.
So what’s happening in Boise, and what’s in store for the western metro now that the U.S. housing market has shifted?
New homes are worked on in Meridian, Idaho, on Friday, Sept. 23, 2022.
Ben B. Braun, Deseret News
National buzz
Over the past two years, Boise has had numerous moments in the national spotlight.
For months, it has consistently ranked among the most “overvalued” housing markets, according to Florida Atlantic University research. Moody’s Analytics recently deemed it the nation’s most “overvalued,” saying Boise home prices are nearly 72% overvalued based on market fundamentals.
Boise was also recently called out — along with other markets like Las Vegas and Phoenix — for what Fortune termed “early-inning housing busts,” noting these “bubbly” markets, while they’ve been at the highest risk of home price corrections, they’ve also seen inventory levels spike over the last five months. Boise inventory is up 298%, Phoenix up 317% and Las Vegas up 192%, Fortune reported, using Realtor.com data.
Boise was also among the first to post a year-over-year home value decline in Zillow’s Home Value Index. The city saw a slight, -1.2% dip according to the index’s seasonally-adjusted data through Aug. 31, with a typical home value of $515,432, down from $521,690 as of Aug. 31, 2021.
That dip is slightly bigger using Zillow’s raw home value index data focused on the Boise metro area, which hasn’t been smoothed or seasonally adjusted, and is a figure Zillow researchers have been using because they say it more accurately captures the state of the market in real time given the current “volatile inflection period.”
According to that raw data, the Boise metro area saw a 3% year-over-year decline, with a typical home value of $491,232 as of Aug. 31. That’s down from $506,201 in August 2021.
However, when Zillow’s Boise metro area data is smoothed and seasonally adjusted, it shows a 1.3% growth in prices year-over-year.
Still, it’s a far cry from the double-digit, year-over-year price growth the metro was seeing in the middle of the pandemic housing frenzy. In August of 2021, that $506,201 typical value was almost 45% up year-over-year from $349,505 in 2020, according to Zillow’s raw index.
So what does …….
