How Boise became the most overvalued housing market in America
Boise is more expensive than it used to be.
U.S. home prices overall rose by 19.8% between August 2020 and August 2021, but are expected to cool off a bit in 2022, with a projected rise of only 2.9% by year’s end. Boise is one of five cities that might be approaching their “pricing crown,” or peak prices, and will soon begin to stabilize, according to FAU.
Boise was ranked the best place to live for millennials in 2019 by Livability, which publishes data rankings for U.S. cities, and was named the fastest-growing city in the U.S. in 2018 by Forbes. U.S. News & World Report ranked Boise 11th in its list of best places to live in 2021–22, writing: “Yes, there are wilder places. Yes, there are more urbane places. But Boise is a good place to live if you enjoy easy access to both.”
Over the course of the pandemic, 194% more people moved to Idaho than moved away, according to Business Insider. Boise has attracted remote workers from more expensive cities like San Jose, according to Realtor.com, a real estate listing website. In Moscow, Idaho, a few hours north of Boise, things don’t look much different. Realtor Misty Curry told The Argonaut, a University of Idaho publication, that one of the primary reasons prices in the greater state of Idaho have shot up is this influx of new people.
“Once 2020 hit, we really saw inventory lack due to the mass amount of buyers coming into Idaho. We have so many new buyers moving in, we just can’t help them,” Curry said.
All those millennials for which Boise is supposed to be a hotspot are hitting their thirties, the prime age of first-time homebuyers. Along with this new wave of buyers, Boise has attracted a rush of remote workers during the pandemic, ranking third on Apartment List’s collection of the best cities for remote work.
And for all that growing demand, the supply is seriously lacking. On a national scale, the housing market is short almost 4 million homes. This is subsequently a problem in Idaho, said University of Idaho economics professor Steve Peterson, according to The Argonaut.
“I don’t think people realize how badly the construction and housing industry were damaged by the greater recession,” he said, referring to the housing crash more than a decade ago. Homebuilding, which halted after the crash, has only recently resumed, Peterson added.
And the lumber needed to actually catch up and build more housing now costs up to 308% more. That makes the cost of homebuilding significantly more expensive, according to Brian Higgins, executive director of an affordable housing nonprofit in Columbus.
All those factors combined could be why real estate prices in Boise are so high.
The surge in home prices isn’t good news for the local community in Boise. One couple told CBS that, after multiple offer rejections, they had finally found a seller who wanted to sell specifically to a local family.
“Why is it like this when just a couple years ago it wasn’t?” one of the homeowners said.
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