Real Estate

Will The Boise Housing Market Crash?

Although the pandemic severely affected housing markets across the United States, in Idaho’s capital — Boise — the impact was especially significant. Beginning in 2020, a notable migration occurred of Californians — particularly tech industry workers from the Bay Area — to the Rocky Mountain tranquility of Boise. This migration led to a marked rise in home prices in the Boise housing market.

Due to this influx over the last couple of years, the Boise housing market got exceptionally hot. So hot, in fact, that now, a common question on people’s minds is: Will the Boise housing market crash?

Read on to find out key trends developing in the Boise housing market in 2023 and how likely a housing market crash could be.

Boise Housing Market 2023: Overview

After analyzing housing data sourced from Redfin
RDFN
 the Boise metro area housing market is showing signs of a significant moderation in home prices compared with the overall trends of the core pandemic years, 2021 and 2022. The median sale price for a home in the Boise metro area reached a peak of $549,580 in May 2022. However, by May 2023, that figure had dropped by 14.5%, to a median sale price of $470,000. As of August 2023 (the latest available data at the time of publication), the median sale price in the Boise metro area was still $470,000.

In the city of Boise proper, home prices also peaked in May 2022, when the Boise median sale price reached an all-time high of $585,000. Since then, prices have declined steadily. In 2023, the median sale price in Boise exceeded $500,000 in only two months — June 2023 ($507,000) and July 2023 ($515,000). By contrast, in 2022, there were seven months when the median sale price in Boise exceeded $500,000.

In the grand scheme of things, Boise home prices remain markedly higher than their pre-pandemic figures. Back in August 2018, the median sale price in Boise was only $295,000. Two years later, in the midst of the first year of the pandemic, Boise’s median sale price had risen to $385,000 in August 2020. It is unlikely that home prices in Boise will return to being less than $300,000 unless the housing market experiences an outright crash.

The city of New Plymouth, northwest of Boise, witnessed the biggest drop in home prices year-over-year. In August 2022, the median sale price in New Plymouth was $332,500, before falling by 36.8%, down to $210,000 in August 2023. The city of Homedale, which is west of Boise near the border with Oregon, saw home prices rise dramatically year-over-year. From a median sale price of $220,000 in August 2022, home prices in Homedale rose by 30.9%, reaching a median sale price of $288,000 in August 2023.

Inventory in the Boise Housing Market Is Down Across the Board

Although home prices in the Boise housing market are no longer inexorably rising, available inventory is dwindling everywhere. For the Boise metro area overall, for-sale inventory fell by 46%, from 4,700 available homes in August 2022, down to 2,536 available homes in August 2023. In the city of Boise proper, housing inventory is down 39.4% year-over-year: From 851 available homes in August 2022, down to 516 available homes in August 2023. Indeed, in no city in the greater Boise housing market did inventory increase.

The city of Wilder, located just north of Homedale, witnessed a huge drop in available inventory year-over-year. In August 2022, for-sale inventory stood at 14 homes, before plummeting by 78.6%, down to just three homes for sale. It should be noted that the 14 available homes in August 2022 were exceptional. In Wilder, available inventory in August 2020 was two homes, and in August 2018, there were six homes. In Middleton, which is larger than Wilder, housing inventory also plunged year-over-year, by 64.4%, from 163 available homes in August 2022, down to only 58 available homes in August 2023.

Houses for Sale in the Boise Housing Market Are Getting Bought Up Faster than Previous Years

An additional very useful metric for analyzing housing market activity is the length of time a home for sale spends on the market before getting bought up. Redfin refers to this measure as days on market, which represents the monthly median days on market a home for sale sits before being taken off the market.

In the Boise metro area, the median number of days on market of a home for sale fell from 33 days in August 2022 to 27 days in August 2023, equal to an annual decrease of roughly 18.2%. However, in the city of Boise proper, the year-over-year decrease in the median days on market was greater — 30.8% — falling from 26 days on market in August 2022 to 18 days on market in August 2023.

Below is a table detailing the trends in days on market in the 20 areas we analyzed in the greater Boise housing market:

The Bottom Line on a Boise Housing Market Crash

On the question of whether the Boise housing market will crash, the data is very mixed. Prices in the Boise housing market have come down for their heights reached in 2022. But they’re still quite elevated compared to pre-pandemic days. Meanwhile, as home prices have moderated, available inventory in the Boise housing market continues to diminish and doesn’t show signs of stopping.

In most of the core cities of the Boise metro area, the number of monthly home sales declined year-over-year. In the city of Boise proper, the number of home sales declined by 15.7%, from 312 home sales in August 2022 to 263 home sales in August 2022. However, the decline in the number of home sales is not a reflection of slackening of demand. Instead, it likely reflects the decrease in available housing inventory: There are simply not enough available homes to sell to homebuyers.

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