I’m not sure that overall affordability of housing will get much better in the future, I mean prices could go down, sure, but there are a lot of other things at play into someone being able to afford a house. This is just one indicator that while the Boise housing market may be cooling and shifting for now, either interest rates will go up in the future to effect affordability, or prices, or inflation, or all 3….either way, it’s a reason I get concerned when people say they want to wait to buy until the market bottoms out. This tells me that whoever is backing these large projects expects our housing market to continue to be unaffordable for many as they are preparing for many more renters in the future. One thing I want to note here, though, is that new construction starts on multi-family units, like townhomes and apartments that are intended to be rentals, are up quite a bit. So, if you’re going to be in the market to purchase a home anyways, new construction options are certainly worth a look. But is it correct to assume the home won’t be worth what you paid for it a year from now? We will circle back around to that question in a few minutes.īuilders are offering anywhere from $7500 up to $30,000 in incentives right now, so yes, new construction is feeling the pinch of a changing market and we will continue to see a give and take of incentives, price reductions, or both until things settle.
And to protect the builder, many builders have put promissory notes into place that basically say that if you back out over the course of the build job, you not only lose your earnest money, but you agree to pay them even more money. Builders are willing to offer you credit to help with whatever your hang up is on pulling the trigger, something that’s not easy to find in a seller of an existing home.īuilders who are building from the ground up are having a much harder time overcoming people’s fear that the house won’t be worth what they paid for it by the time they close a year from now. Most of the incentives offered right now are centered around giving credits for long rate locks and rate buy-downs, as interest rates rising over the course of a long build job are a huge concern for non-cash buyers.īuilders who are selling spec, or pre-finished homes actually have a lot to offer right now over existing home sellers who are emotional about the process and are having a hard time wrapping their heads around the new Boise housing market conditions. Whereas last year we still had long waiting lists for some developments, this year we’ve got builder’s sales agents calling us and telling us their incentives and asking us to bring our buyers over.īuilders are trying not to reduce home prices but offer incentives instead – they want to try to protect those who are under contract at higher prices and keep the home valuations up. They are trying to adjust to the housing market shift. From driving around it doesn’t look like it, but home builders here are pulling back on the number of starts for single family new construction. If you come to visit, you’ll notice new homes going up everywhere, especially all around the outskirts of town. First, New Construction in the Boise Housing Market There’s a wide variety of information today about the Boise housing market, so grab a cool drink (I made some passion fruit iced tea), relax for a minute, and let’s cool down while we dig into this hot mess. If you want the general market overview, you can check out my past few blog videos where I dig specifically into the Boise housing market for buyers and sellers, but in this video, I’m going to go over answers to the questions I am getting daily now- like what’s happening in new construction? How much are prices really dropping? What’s going on with interest rates? Should you rent to wait things out? And I’m going to discuss one key indicator of data that many people are overlooking right now. It is hot in Boise, Idaho, and the Boise housing market? Well, it’s a bit of a hot mess right now too! So, let’s all just cool off a little and talk through what is going on in our housing market and find out how this hot mess leading to a Boise housing market cool down will affect you.
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