A4 – Ada County Sold Units

A6 – Dollar Volume Year to Date

It is pretty obvious when you compare these two numbers:

Ada County sold units January – April 2012 10% higher than 2011.
Ada County Dollar Volume for the same period 19% higher than 2011.

March sales figures for both Ada & Canyon County show a slower pace in unit sales; but strong increase in dollar volume compared to a year ago.

In Ada the units sold at the end of March Year to Date fell to 6% ahead of 2011 from 14% at the end of February. Dollar volume year to date is 12% up reflecting the higher sales prices in 2012.

Canyon county fell to a 10% loss in units year to date compared to 2011; but only a 2% loss in dollar volume.

Why? What is causing this slow down? Lack of inventory, plain and simple. Builders are ready and willing to supply the demand but many buyers are still looking for distressed property bargains that just aren’t out there anymore.

New Constuction Pendings shot up in March which will play out in larger sales numbers in the months to come. Ada County is up 120% compared to a year ago at this time, Canyon up 117%.

What is causing this? The critical shortage of inventory! There were less than 100 REO (bank owned) listings on the market at the end of March. Inventory in the Treasure Valley is at historic low levels – lower than at any time over the past 13 years since I have been tracking it for March numbers.

So as prices go up, new construction becomes more and more of an option again especially with many builders holding lot inventories at very reasonalble cost levels.

However, Star in particular is way overbuilt for new construction below $300,000. Builders be careful. Study charts A45, AC34, and A38 before starting any more specs!

These are important numbers for anyone interested in Ada County real estate. Here is what they mean: In January the median sales price of a resale home was up 3% over January 2011. A gain, that is a good thing!

In February the Year to date Median was up 4% over 2011. Even better!

Now in March, checking it today just prior to the month’s ending the news is even better! The median sales price year to date is now up 6% in 2012 over 2011. So the national predictions that I have read recently predicting a 4-6% gain in 2012 may well be exceeded!

Why? A combination of two things happening right now here in the Treasure Valley. First there is an extremely low inventory of available homes for sale. Secondly, demand is increasing every year for the last 3 years. Look around at all of the new commercial construction. . . Eagle road, Chinden, Downtown +++ Things are popping.

Buyers are starting to get the message and are moving off the fence. One year from now the home that costs 185 could be close to 200!

Sales are up!  Pendings are up!  Dollar Volume is up!  Median pricing is up!  Future Business Forecast is up!  Inventories are down!  Distressed sales are down!

Almost anyway that you look at the February stats, there is a lot to encourage optimism right now in this market.  Buyers are starting to catch on and are moving off the fence.  Investors are beginning to appear again as the news is getting out.

One of the most telling facts is simply this:  At the close of 2011 the National Association of Realtors report showed an 8.1 months supply of resale homes in the United States.  That same calculation for Ada County reveals only a 3.1 months of supply.  That is huge!

You don’t have to have an advanced degree in economics to predict that prices will rise again finally here in 2012.  I believe that 4-6% is very likely for the county.  And some areas such as Eagle will experience an even higher increase.

The January 2012 numbers are in and there is a lot to encourage Boise area homeowners!  After hitting a low in 2008, the past three years have shown an increase in the number of homes sold every year.  January continues that pattern with 13% more homes sold than January of 2011.

A3 – Ada County Monthly Sales Units

The dolloar volume was also up 10% from a year ago showing signs that price declines are either over or at least greatly slowing.  Since the resale median price set a new record low in 1/11 this month’s increase of 3% over that is especially significant.

A12 – Ada County EXISTING Monthly MEDIAN Sales Price

A strong case can be made for higher prices based upon demand and inventory levels.  January 2012 continues to reflect record low inventories of unsold homes.  My sense is that has to translate into higher prices – good news that has been a long time in coming!

For the first time in 70 months home inventory has fallen below the 2,000 level in Ada County.  You have to go back to January of 2006 to find a time when inventory levels were lower than this!  Canyon is the same with the inventory dropping below 900 for the first time since February 2006.

A16 – Ada County Residential INVENTORY

So, what does this mean?  Fewer options for buyers, prices will continue to firm up.  It is now a seller’s market at a very greatly adjusted pricing point.  In general the prices are back to 2002 levels!  But there is only a 3.1 months supply of resale homes currently on the market.  New Construction is a different story.  Builders are pushing ahead as much as they dare with more than a 7 months supply of homes available.

The Median price for a resale home in Ada County was 7% higher in December than the January 2011 low point.  That is a sign that the Valley real estate market may have bottomed out several months ago.  Here is a chart that takes a longer term view and plots 6 month blocks of median pricing.

A15 – Ada County EXISTING Last 6 Months MEDIAN Sales Price

The December decrease reflects a seasonal pattern that has repeated itself for the past 6 years.  Once the January 2012 numbers are in we will have an excellent reference point to compare with the previous low in 2011.

The numbers are in and there are a lot of bright spots for the Treasure Valley!  For the third year in a row home sales have increased since the low in 2008.  Ada County is up 26% in unit sales since then; Canyon 48%.

Also there is a strong gain over 2010.  5% in Ada and 6% in Canyon.  Here is a picture of unit sales activity since 1999 in Ada.

A1 – Ada County Yearly Sales History

Here is the same picture that breaks out the New Construction from the resale.  No wonder so many builders are out of business!  However I believe that 2011 will be the “bottom point” for New Construction and we will see an uptick in 2012.

A1A – Ada County Yearly Sales History

The median price of a resale home in Ada County was $138,200 in November.  This is up 9% from the low of $126,500 in January 2011.  Even more significant than a single month is the gain being posted using a “6 month rolling median”.  Using this measurement, June 2011 was the low point and there have been solid gains since then.  Check out this chart!

A15 – Ada County EXISTING Last 6 Months MEDIAN Sales Price 

Canyon County is showing a gaudy 17% increase in Median Sales price this month over the low 5/11 of $72,500!

Inventory continues its downward trend at a rate that can only signal additional upward price pressure in coming months.  At this time in 2007 there were 4542 homes on the market for sale.  November of 2011 – 2166.  That is less than half!  Also at this time 397 of the listings shown as “Active” already have short sale contracts on them.  So in reality there are only 1769 homes that are truly “Active” for sale at this moment.  You have to go back to 2000 & 2005 to find an inventory lower at the end of November.   Here is a picture:

A16 – Ada County Residential INVENTORY

What this also signals is a rebirth of new construction coming in 2012.  Smart builders will be careful however to position specs at the right price points.  The lower ones are already flooded.  Believe it or not there is a niche open between 300 and 500 thousand for new construction right now!  Here are two charts that back that up.

AC24 - NOVEMBER 2011 YTD SELLING ODDS New Construction

A45 – Ada County Year to Date SALES & INVENTORY ANALYSIS New Construction –

If you would like more information please call:  Jere Webb, Realtor.  Coldwell Banker Tomlinson Group.  208.861.2222