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Population Growth Behind Rising Treasure Valley Home Prices

Population Growth Behind Rising Treasure Valley Home Prices

Below is a link to a news story by Justin Corr with KTVB explaining why the Boise area housing market continues to improve.  Within the story, Justin explains how home values have improved and in part, due to growth within the Boise Valley with most of that growth being in Meridian.  However the housing market consists of two markets, sales and rentals.  Since Justin didn’t cover the rental side, I will.  As of today, First Rate Property Management does not have a single available rental.  That’s right, with nearly 1,000 rental units in management; we don’t have a single one available.  All management companies within the area likely are reporting record low vacancies and I would assume that the same factors that have improved the sales market have also improved the rental market.

BOISE -- Fewer and fewer people are upside down on their mortgages, thanks to rising home values around the country, and here in Idaho.  See all 5 photos »

Intermountain MLS says at this point last year, the median home price in Ada was $177,500. This year, it's about $20,000 more.

The reason? Real estate expert Chris Lofthus says it's because of population growth.

"We're seeing an influx of people that are moving in from out of state, anywhere from Alaska to Washington," said Lofthus. "A ton of California people are moving in here."

The growth is clearing visible in the state's largest school district. According to Meridian School District spokesman Eric Exline, the district has grown by about 500 kids per year over the past few years.

By next year, Exline says that number could double to 1000 per year, which is the pre-recession level.

"There are subdivisions that I would describe as having sort of been 'moth-balled,' just shut down," said Exline. "Nothing happened for about three years. And now, there are houses coming out of them in a number of places. And, we also have a fair amount of commercial property."

And while there has been a rise in the commercial real estate market, too, you might wonder where all these new Idahoans are going to work.

Lofthus says many of his clients are people who can telecommute throughout the region.

"We're seeing a lot of people that can live anywhere on the West Coast, like regional sales managers," he said. "We're seeing lots of people move in, who don't necessarily need to have a job in Boise."

But, are prices rising too much too fast? Is this boom going to turn into another bust? Lofthus doesn't think so, and he's supported by rising borrowing costs.

"We're going to see another increase this next coming year," Lofthus said. "I don't think it's going to go crazy. I don't think the banks are going to loosen up their purse strings any time soon."

by Justin Corr

Follow: @JCorrKTVB


Posted on December 1, 2013 at 6:17 PM


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