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Market News • Real Estate Trends •
May 9, 2023
Q1 2023 Idaho Real Estate Market Update
The following analysis of select counties of the Idaho real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Real Estate agent.
Regional Economic Overview
Year over year, Idaho added 24,900 jobs, representing a solid growth rate of 3%. All of Idaho’s metropolitan areas saw year-over-year nonfarm job gains. Pocatello experienced the greatest increase at 5.5%, followed by Boise (3.7%), Idaho Falls (3.1%), Coeur d’Alene (2.9%), Twin Falls (.4%), and Lewiston (.3%). The state unemployment rate was 2.6%, matching the rate of the first quarter of 2022. The Boise metro area matched the state’s jobless rate of 2.6% and equaled the rate during the same period in 2022. This is rather impressive given that the labor force has grown by over 9,800 persons, or 2.4%. Clearly new jobs are being created at a very solid pace. My current forecast is that employment will rise by 17,000 jobs, which would represent a growth rate of 2 percent.
Idaho Home Sales
❱ In the first quarter of 2023, 4,205 homes sold, which was down 19.5% from the first quarter of 2022 and 2.3% lower than in the fourth quarter of last year.
❱ Although listing activity was significantly higher than the first quarter of 2022, it was down 27% from the fourth quarter of 2022. All counties had fewer homes on the market.
❱ Compared to the same period in 2022, sales fell in all but two markets covered by this report. Compared to the fourth quarter of last year, sales fell in all the Northern Idaho markets, but rose in Canyon, Ada, and Blaine counties in the southern part of the state.
❱ Even with fewer listings, pending sales in the quarter were up 36.9% from the fourth quarter of 2022, suggesting that sales growth may improve in the second quarter of this year.
Idaho Home Prices
❱ The average home price in the region fell 6% year over year to $576,130. Prices were 5.4% lower than in the fourth quarter of 2022.
❱ Compared to the fourth quarter of 2022, prices only increased in Shoshone County. In the southern part of the state, prices rose in Valley, Payette, Gem, Boise, and Blaine counties.
❱ Both the northern and southern market areas saw counties split, with prices rising in around half while contracting in the other half. Year over year, prices fell 6.4% in the south and 4% in the north.
❱ Median listing prices in the first quarter were up by only .9% over the fourth quarter of last year. Interestingly, listing prices were up more than 10% in the populous Ada County, which many believed would see significant downward price pressure after the rapid growth over the past few years.
Mortgage Rates
Rates in the first quarter of 2023 were far less volatile than last year, even with the brief but significant impact of early March’s banking crisis. It appears that buyers are jumping in when rates dip, which was the case in mid-January and again in early February.
Even with the March Consumer Price Index report showing inflation slowing, I still expect the Federal Reserve to raise short-term rates one more time following their May meeting before pausing rate increases. This should be the catalyst that allows mortgage rates to start trending lower at a more consistent pace than we have seen so far this year. My current forecast is that rates will continue to move lower with occasional spikes, and that they will hold below 6% in the second half of this year.
Events • Market News • Real Estate Trends •
January 4, 2023
2023 Economic and Housing Forecast with Matthew Gardner
Please join us for the 2023 Economic and Housing Forecast with Matthew Gardner
As Chief Economist for Windermere Real Estate, Matthew Gardner analyzes and interprets economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience. He will provide insight on the current economy, housing, and the economic forecast in the Treasure Valley.
This is a great way to stay informed about the 2023 economy. Matthew Gardner is experienced, knowledgeable and engaging. You don’t want to miss it. If you have any questions, please contact Gretchen Bolton at our office at 208-920-5966 or gbolton@windermere.com. Please extend this invitation to anyone who is interested in learning more about the 2023 economic forecast for Idaho and beyond.
Tuesday, January 17, 2023
Breakfast Served: 9:00 am | Speaker and Q&A: 10:00 am-12:00 pm
JUMP – Jack’s Urban Meeting Place – Pioneer Room
REGISTER HERE
If you have any questions, please contact Gretchen Bolton at our office at 208-920-5966 or gbolton@windermere.com. Please extend this invitation to anyone who is interested in learning more about the 2023 economic and housing forecast for Idaho and beyond.
Uncategorized •
November 15, 2022
Matthew Gardner’s Top 10 Predictions for 2023
This video shows Windermere Chief Economist Matthew Gardner’s Top 10 Predictions for 2023. Each month, he analyzes the most up-to-date U.S. housing data to keep you well-informed about what’s going on in the real estate market.
Matthew Gardner’s Top 10 Predictions for 2023
1. There Is No Housing Bubble
Mortgage rates rose steeply in 2022 which, when coupled with the massive run-up in home prices, has some suggesting that we are recreating the housing bubble of 2007. But that could not be further from the truth.
Over the past couple of years, home prices got ahead of themselves due to a perfect storm of massive pandemic-induced demand and historically low mortgage rates. While I expect year-over-year price declines in 2023, I don’t believe there will be a systemic drop in home values. Furthermore, as financing costs start to pull back in 2023, I expect that will allow prices to resume their long-term average pace of growth.
2. Mortgage Rates Will Drop
Mortgage rates started to skyrocket at the start of 2022 as the Federal Reserve announced their intent to address inflation. While the Fed doesn’t control mortgage rates, they can influence them, which we saw with the 30-year rate rising from 3.2% in early 2022 to over 7% by October.
Their efforts so far have yet to significantly reduce inflation, but they have increased the likelihood of a recession in 2023. Therefore, early in the year I expect the Fed to start pulling back from their aggressive policy stance, and this will allow rates to begin slowly stabilizing. Rates will remain above 6% until the fall of 2023 when they should dip into the high 5% range. While this is higher than we have become used to, it’s still more than 2% lower than the historic average.
3. Don’t Expect Inventory to Grow Significantly
Although inventory levels rose in 2022, they are still well below their long-term average. In 2023 I don’t expect a significant increase in the number of homes for sale, continue reading
Market News • Real Estate Trends •
November 1, 2022
Q3 2022 Idaho Real Estate Market Update
The following analysis of select counties of the Idaho real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Real Estate agent.
Regional Economic Overview
Employment in Idaho continues to grow, but the pace has started to taper. The addition of 22,400 jobs over the past 12 months represents a growth rate of 2.8%. Idaho’s third-quarter unemployment rate was 2.7%, down from 3.5% a year ago. This is higher than the all-time low in May and June of this year, but very impressive all the same. Although jobs are being added at a slower pace, I am not concerned given the current unemployment rate and the growing labor force.
Idaho Home Sales
❱ In the third quarter of 2022, 5,243 homes sold, which was 28.7% lower than a year ago and 18.1% lower than in the second quarter of the year.
❱ Listing activity was up 53% compared to a year ago. The average number of homes on the market was 9.1% higher than in the second quarter of 2022.
❱ Compared to the same period a year ago, sales fell in the northern part of the state and were lower in all areas of Southern Idaho except Valley County. Compared to the second quarter, sales also fell across Northern Idaho, but rose in Valley, Payette, and Boise counties in the southern part of the state.
❱ Pending sales were 19% lower than in the second quarter of this year. With more listings and fewer sales, the market is certainly slowing, much of which can be attributed to rising mortgage rates, which hit a level we have not seen since 2008.
Idaho Home Prices
❱ The average home price in the region rose 4.3% year over year to $625,275 but was down 2.9% compared to the second quarter of the year.
❱ Compared to the second quarter of 2022, prices rose in all Northern Idaho counties except Kootenai, where they were down 1.7%. In the southern part of the state, prices fell across the board.
❱ Prices rose by double digits in Bonner and Boundary counties, while the balance of Northern Idaho counties saw single-digit growth. In the southern part of the state, prices rose in four of the counties, but fell in Boise, Valley, and Blaine counties.
❱ Median listing prices in the second quarter were lower in all southern markets, but higher in all but Bonner County in the northern part of the state.
Mortgage Rates
This remains an uncertain period for mortgage rates. When the Federal Reserve slowed bond purchases in 2013, investors were accused of having a “taper tantrum,” and we are seeing a similar reaction today. The Fed appears to be content to watch the housing market go through a period of pain as they throw all their tools at reducing inflation.
As a result, mortgage rates are out of sync with treasury yields, which not only continues to push rates much higher, but also creates violent swings in both directions. My current forecast calls for rates to peak in the fourth quarter of this year before starting to slowly pull back. That said, they will remain in the 6% range until the end of 2023.
Idaho Days on Market
❱ The average number of days it took to sell a home in the region rose five days compared to the same quarter of 2021 but fell six days compared to the second quarter of 2022.
❱ In Northern Idaho, days on market rose in all counties other than Kootenai compared to a year ago. Market time rose in every county other than Blaine in Southern Idaho.
❱ It took an average of 74 days to sell a home in Northern Idaho, and 37 days in the southern part of the state.
❱ Homes sold the fastest in Ada County in the southern part of the state and in Shoshone County in Northern Idaho.
Conclusions
This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.
The third quarter appears to have been an inflection point: the impact of higher mortgage rates and lower affordability have now started to negatively affect home sales and prices. With mortgage rates likely to remain very high compared to recent years, the massive run-up in home values is at an end. Although the market will continue to be negatively impacted as we move through the winter and into the spring, I don’t see it falling in a manner similar to the Great Recession. Owners are sitting on significant equity. Even if prices fall in 2023, which I expect, the decline will be relatively modest.
With a contracting market, I expect that many homeowners who were thinking about selling will decide to stay put and ride out the slowdown. This will mean the number of homes for sale is unlikely to grow significantly from current levels. Given all the data discussed here, I am moving the needle more toward balance, but we are still not in a typical buyer’s market at the present time.
About Matthew Gardner
As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.
In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.
Market News • Real Estate Trends •
May 3, 2022
Q1 2022 Idaho Real Estate Market Update
The following analysis of select counties of the Idaho real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Real Estate agent.
Regional Economic Overview
Employment in Idaho rose 3.2% over the past 12 months and the latest data shows the number of jobs is 38,300 higher than the pre-pandemic peak. This is particularly notable as there are only nine other states that have exceeded their pre-Covid employment levels. The state unemployment rate was only 2.7%, down from 3.1% at the end of 2021, and lower than the March 2021 rate of 3.9%. There was a very modest decline in total employment between February and March of this year, but I do not see this as being an issue. The labor force continues to grow, and my current forecast calls for employment to rise 3% in 2022.
Idaho Home Sales
❱ In the first quarter of 2022, 5,183 homes sold, representing an increase of 4.2% compared to a year ago but 24.7% lower than in the fourth quarter of 2021.
❱ Quarter over quarter, sales fell in every county covered by this report.
❱ Sales fell in all the northern counties contained in this report compared to a year ago, but this was offset by rising sales in more than half of the counties in Southern Idaho.
❱ Pending sales were 2.7% lower than in the fourth quarter of 2021, but this is more than likely a function of inventory levels, which were down 28.4% from the last quarter. Supply is still very tight.
Market News • Real Estate Trends •
November 3, 2021
Q3 2021 Idaho Real Estate Market Update
The following analysis of select counties of the Idaho real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Real Estate agent.
REGIONAL ECONOMIC OVERVIEW
On top of having recovered all the jobs lost to COVID-19 by the end of 2020—a remarkable feat in itself—the Idaho economy continues to strengthen. Current employment levels are up by 15,400 jobs from the pre-pandemic peak. With the labor market continuing to expand, the unemployment rate was 2.9% in August (the most recent data available). Equally impressive was that the rate dropped even as the labor force grew—no easy task. New COVID-19 cases remain higher than I would like, but this does not appear to have impacted the state’s economy to any significant degree given the robust employment picture. As we move, hopefully, toward a time when the impacts of the pandemic wane further, I see nothing but an upward trajectory for the state’s economy.
IDAHO HOME SALES
❱ In the third quarter, 7,354 existing homes sold, representing a drop of 19.9% from a year ago. However, given that the country was experiencing a massive housing rebound following the outbreak of COVID-19, any comparison with data from 12 months ago is not very informative. More useful is that sales rose 22.1% compared to the second quarter of 2021.
❱ As mentioned, comparing current data to a year ago does not provide an accurate picture, but comparing it with the second quarter data shows sales higher across the board. Sales were up by double digits in every county covered by this report.
❱ Year-over-year sales improved in Shoshone County in Northern Idaho. Sales also rose in Gem County in the southern part of the state.
❱ Pending sales rose 16.5% from the second quarter of 2021, suggesting that closed sales in the final quarter of the year are also likely to show improvement from current levels. This is also supported by the fact that listing inventory has risen almost 36%. I predict more listings will lead to more sales.
IDAHO HOME PRICES
❱ The average home price in the region rose 30.9% year over year to $603,066. Prices were also up 8% compared to the second quarter of this year.
❱ Compared to the previous quarter, home prices were up 8.9% in both the northern and southern counties in this report. Sizable gains were seen in Shoshone County (+33.7%) and Bonner County (+22.7%) in the north, and Valley County (+22.6%) and Blaine County (+17.2%) in the south.
❱ Prices rose by double-digits across the board. Sale prices were up 37% in the North Idaho counties covered by this report, and up 27.7% in the southern counties.
❱ With far more buyers than sellers, home prices continue their upward march. As prices are rising at a far faster pace than wages, this cannot continue indefinitely. I expect to see the pace of appreciation start to slow, but probably not until next year.
DAYS ON MARKET
❱ It took an average of 72 days to sell a home in Northern Idaho, and 31 days in the southern part of the state.
❱ The average number of days it took to sell a home in the region dropped 23 days compared to the third quarter of 2020 but rose 2 days compared to the second quarter of this year.
❱ In Northern Idaho, days on market dropped in all counties versus a year ago but rose in all counties compared to the second quarter of this year. Market time in Southern Idaho was also lower than a year ago, but it was up from the prior quarter in Valley, Gem, and Blaine counties.
❱ Homes sold the fastest in Ada and Canyon counties in the southern part of the state. Sales were again fastest in Shoshone County in the northern part of the state.
CONCLUSIONS
This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.
Idaho’s economy appears to be powering forward and job recovery is well ahead of almost every other state. The result is clearly an increasing number of buyers who feel comfortable buying a new home, even given the dramatic price growth of late.
That said, the only factors favoring buyers right now are that there are significantly more homes to choose from and mortgage rates remain very low by historic standards. All other factors support sellers more than buyers. As such, I am moving the needle a little more in their favor, even as affordability concerns continue to rise.
ABOUT MATTHEW GARDNER
As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.
In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.
Events • Market News • Real Estate Trends •
January 14, 2020
Matthew Gardner – Will There Be A Recession in 2020?
Windermere Chief Economist, Matthew Gardner, answers the most pressing question on everyone’s minds: Will there be a recession in 2020? Here’s what he expects to see.
If you are interested in learning more about the Idaho’s economic and real estate market forecast for 2020 from Matthew Gardner live, please join us on January 30th at JUMP in Boise from 10:00 am-12:00 pm. To reserve your spot or if you have any questions, please contact Gretchen Bolton at gbolton@windermere.com.
Market News • Real Estate Trends •
November 4, 2019
Idaho 2019 3rd Quarter Real Estate Economic Report
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The following analysis of select counties of the Idaho real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact us.
ECONOMIC OVERVIEW In August, the state unemployment rate was 2.9%, marginally higher than the 2.8% rate a year ago. It cannot be disputed that the state remains at full employment. It’s also interesting to note that the employment rate remained below 3% even as the labor force rose by 2.2%, suggesting that the economy remains very strong and new entrants to the labor force are finding jobs relatively easily. |
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| HOME SALES | ANNUAL CHANGE IN HOME SALES Q3-2018 TO Q3-2019 |
| ❱ During the third quarter, 7,342 homes sold, representing a modest drop of 3.4% compared to the third quarter of 2018.
❱ In Northern Idaho, Shoshone County experienced a 17.9% increase in sales over the third quarter of 2018. There was a modest increase in Bonner County and a very slight contraction in Kootenai County. In Southern Idaho, sales jumped in Boise and Canyon counties. Blaine County also saw a slight increase, but sales activity was lower in the rest ❱ Year-over-year sales growth was positive in two Northern Idaho counties and three Southern Idaho counties. ❱ Pending sales rose in the third quarter, suggesting that closed sales in the final quarter of this year are likely to be an improvement over current figures. |
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HOME PRICES
| ❱ The average home price in the region rose 8% year-over-year to $367,963. Prices were 2.7% higher than in the second quarter of this year. ❱ Prices rose in all counties compared to the third quarter of 2018. |
❱ In Northern Idaho, Shoshone County led the market with the strongest annual price growth. Bonner County also had solid price growth. In Southern Idaho, Gem County saw prices rise a very significant 29.7%, and there were notable increases in Valley, Canyon, and Boise counties. | ❱ Inventory continues to be an issue. The number of homes for sale is down 3.4% compared to the third quarter of 2018. Although listings are up 7% over the second quarter, the market remains very tight, and this is pushing prices higher. |
| ❱ It took an average of 94 days to sell a home in Northern Idaho, and 54 days in the southern part of the state.
❱ The average number of days it took to sell a home in the region dropped ten days compared to the third quarter of 2018. It was also ten days lower than in the second quarter of this year. |
❱ In Northern Idaho, days-on-market dropped across the board. In Southern Idaho, market time dropped in all counties except Ada and Canyon, though the rise in average market time was very modest.
❱ Homes sold the fastest in Gem, Canyon, and Ada counties. |
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The speedometer reflects the state of the region’s housing market using housing inventory, price gains, home sales, interest rates, and larger economic factors.
Job growth continues to slow from the frenetic pace of the past few years but remains quite impressive. As is commonly known, economic/job growth leads to demand for homeownership and this continues to bode well for the Idaho market; however, home sales continue to be held back by a lack of inventory and this is leading to higher prices. As such, it remains a sellers’ market so I have moved the needle just a little more in their direction. ABOUT MATTHEW GARDNER Governors Council of Economic Advisors; chairs the Board of Trustees at the WA Center for Real Estate Research; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics. |
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Market News • Real Estate Trends •
August 14, 2019
Idaho Economic Market Report
The following analysis of select counties of the Idaho real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact our office.
ECONOMIC OVERVIEW
Following a trend that started last fall, job growth in Idaho continues to moderate. The addition of 18,400 new jobs year-over-year represents an annual growth rate of 2.5%. This is to be expected at this point in the economic cycle, but it’s worth noting that the current rate of job growth remains well above the national average of 1.6%.
In May, the state unemployment rate was 2.8%, marginally lower than the 2.9% rate of a year ago. The state remains at full employment, though it is interesting to note that the employment rate remained below 3% even as the labor force rose 2%, suggesting that the economy remains very robust as there are still job openings to accommodate new workers.
HOME SALES
- 6,936 homes were sold during the second quarter of 2019, representing a modest drop of 2.8% from the second quarter of 2018.
- In Northern Idaho, Shoshone County was the only county to experience sales growth, with sales up by 21.3% over the second quarter of 2018. There was a modest decline in sales in the other two counties. In Southern Idaho, Canyon and Payette counties had modest sales growth, but the rest of the region experienced lower sales activity.
- Year-over-year sales growth was positive in just one of the Northern Idaho counties. Sales rose in two Southern Idaho market areas relative to the same period a year ago.
- Pending sales rose in the quarter, suggesting that closed sales next quarter are likely to be an improvement over current figures.
HOME PRICES
- The average home price in the region rose 7.8% year-over-year to $358,406 and was 3.2% higher than the first quarter of this year. Continue reading…..
