BOISE, Idaho (CBS2) — A Florida Atlantic University study calls Boise the most overpriced housing market in the U.S. Boise Regional Realtors isn't so sure.
It's plain that Boise house prices have risen drastically over the past few years. The Zillow Home Value Index, which FAU used for their study, shows almost a 45% increase in Boise home values since July last year. Zillow's index tracks the normal trend for prices in an area over the last few decades. Boise's prices are about 80% higher than the trend suggests they should be.
Boise Regional Realtors says that a lot of this can be explained by supply v.s. demand. Boise is growing very quickly, creating increased demand on the housing market. "If no additional homes were listed starting August 1st, the supply of homes for sale would run out in less than two months," Boise Regional Realtors reports in their online blog.
It's basic economics that if there's more demand than supply, prices will go up. But Boise is growing faster than the market can keep up with. It'd take almost 20,000 new houses by 2023 in order to balance the market, research from the U.S. Department of Housing and Urban Development says.
All of this has contributed to Boise houses selling for far more than the historical average. It is hard to say whether this means houses are overpriced.
But people are paying above the list price for homes. Boise Regional Realtors reports that 53.3% of houses are sold for more than their asking price.
Despite high prices, people have been able to buy houses because interest rates are a lot lower. But with prices so high, that might stop being true.
"For homeowners who can, it is worth exploring a sale due to the higher prices," Boise Regional Realtors says.