Western States See Prices More than Double in Decade

Key Highlights

• Boise ID prices up staggering +32% in a year, according to Zillow
• Solution? Build more houses

Western States See Housing Prices Explode

Just one year ago, the owner of a 730 square foot rental house in Boise ID offered to sell the house to his renters for $256,00.  Today, the asking price for the same, as-is house is nearly $400,000.

Within just the last 30 days, according to Zillow, the valuation price of that house increased $15,000.

With new figures from Zillow, home values in Boise have increased an eye-popping +32% in this past year,

Will the West’s Housing Boom Implode?

Vivek Sah, real estate economist and director of the Lied Center for Real Estate at the University of Nevada, Las Vegas, said, “The boom is sustainable.  The growth in prices is not.”

Sah believes that when supply chain troubles such as lumber prices and labor shortages, subside, strangling inventory shortages will ease.

And if the inventory does open up, Sah believes, “This whole bubble thing will slow down to become a normal market where prices increase probably between 5% to 10%.”

Chances of a Crash?

Sah says no.  He, as other industry experts, sees a difference between this current housing boom and the happenings leading up to the 2008 collapse.  Then, lending scheming, lack of lending guidelines, and speculators fueled the market.  That, according to Sah, is not happening now.

Ed Coulson, an economist and director of the Center for Real Estate with the University of California, Irvine, agrees.  He questions whether or not pandemic preferences for housing will be permanent.

In other words, will the couple from California who scurried to Montana last through a second Montana winter?  Will major employers begin to put an end to work-from-home practices and insist that workers return to downtown offices?

Will Boise Market Continue to Sizzle?

Probably, say Coulson, Sah, and others.  Boise as a city has much to offer residents in terms of amenities and outdoor activities.

They also say that the only real solution to Boise’s soaring home prices is to build more housing, particularly dense housing.

More housing, and particularly dense housing, is considered a tough sell in libertarian-leaning states such as Nevada and Idaho…the two housing markets typically listed as the two fastest per capita growing states in the country.

Sobering Statistic

Boise’s median income has increased approximately +20% since the Great Recession’s recovery.

Simultaneously, the median housing price in Boise has exploded +250%, according to the Boise Regional Realtors.

 

Thanks to National Public Radio.

 

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