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A family income of $120,000 would reasonably support a mortgage of $300,000 (2.5 x income). I know plenty of college educated couples in Boise that don't make close to that much (less than $100,000 combined). Sure some do, but not enough to support the inventory of homes that are currently priced at or above those levels. Throw in that HP just announced disappointing earnings yesterday due to lagging sales in their printer division, an uncertain future for Micron, and many software/technology companies in the U.S. (a sector that Boise is notorious for) reporting atrocious earnings this quarter with very bleak future estimates, and I don't think we are at the bottom yet.
I would also add that much (more than people realize) of the prosperity of the U.S.A. during the last 25-30 years was due to debt expansion, (i.e. it was a facade). Our country's total debt (government, corporate, and personal) is 52.1 trillion. Our GDP is only 14.4 trillion. This is the largest imbalance in our recorded history. Something has to give, but sadly the politicians are trying all that they can to keep the bubble inflated. We'll see. Time will tell.
Your theory leaves out people who save $ and put much more than 10% down, and/or who have money from other resources.
We've never made anywhere near 120K a year and we have a home that cost 300+K ... You can't put everyone in a bubble. We don't all fit.
I didn't leave them out. I am just willing to bet that in our consumption obsessed culture they are in the minority. Maybe in the next 1-2 years we can pull up this thread and see where real estate in the Boise market is at. I see that if we go back to as recently as the Fall of 2007, some posters thought that it was a good time to buy.
I think the market will go lower before it goes higher, especially in the high end homes.
Boise easily has the economy to support $300,000 + homes because there were many of those around before the market experienced the spike in prices 4 or 5 years ago. The median income also supports this.
There's no way. Boise absolutely DOES NOT have the economy to support these homes. These homes were built in the past 10 years when prices were spiking and equity rich out of staters were cashing in. Prices have been spiking upward for longer than 4-5 years.
Boise hardly has the economy to support homes at $250,000-$300,000. Why do you think so many people make the move to Meridian, Kuna, Nampa, and Caldwell and make the commute into Boise? Not because they can afford Eagle and Northend prices.
Quote:
Originally Posted by Syringaloid
I also think the market is bottoming out and will start moving forward again this year or next year, the values in my neighborhood are not much lower than they were 2 years ago. Most of my friends who are involved in real estate are seeing sales picking up. It is just the foreclosures we need to worry about.
Sales are picking up in the homes that are $250,000 and below, but then those have always been rather solid. Homes are stagnant or dropping above that. I'm not sure your optimism coincides with reality.
Quote:
Ada County numbers:
$69,999 and under = 1
$70,000 to $89,9999 = 3
$90,000 to $99,999 = 1
$100,000 to $119,999 = 11
$120,000 to $159,999 =64
$160,000 to $199,999 = 61
$200,000 to $249,999 = 45
$250,000 to $299,999 = 22
$300,000 to $399,999 = 20
$400,000 to $499,999 =8
500,000 and over =8
76.2% of all closed homes sold for less than $250,000
85.2% of all closed homes sold for less than $300,000
93.4% of all closed homes sold for less than $400,000
96.7% of all closed homes sold for less than $500,000
There are 698 homes listed in Ada County above $400,000 now
There are 433 homes listed in Ada County above $500,000 now.
Available Homes
# Available: 3,938
# Vacant: 2,141
Vacant Percent: 54.4%
Average Asking Price: $311,607
Median Asking Price: $234,900 Pending Sales # Pending: 560
Average Asking Price: $231,084
Median Asking Price: $190,000 Closed Sales - January 2008 # Closed: 327
Average Sales Price: $262,502
Median Sales Price: $220,000 Closed Sales – January 2009 # Closed: 246
% Change: -24.8%
Average Sales Price: $224,870
% Change: -14.3%
Median Sales Price: $181,800
% Change: -17.4%
Data taken from Intermountain MLS on 2/4/09 and pertains to single-family residences on lot or acreage. Data does not include condominiums or townhomes.
I didn't leave them out. I am just willing to bet that in our consumption obsessed culture they are in the minority. Maybe in the next 1-2 years we can pull up this thread and see where real estate in the Boise market is at. I see that if we go back to as recently as the Fall of 2007, some posters thought that it was a good time to buy.
I think the market will go lower before it goes higher, especially in the high end homes.
I agree. This thread is interesting in how far off some of the analysis has been.
However, I do agree with the others that have said the past year - and now - are good times to buy if your ducks are in a row.
Even the National Association of Realtors have changed their tune, encouraging people to buy a home as a long time investment, instead of a cash cow to flip and or use for credit to finance junk.
Home prices will continue to fall everywhere. Just basic economics. Like it or not, till Boise has a more diverse economy its real estate market will be strongly tied to California and other nearby high priced real estate markets. People can't sell their homes here so they can't buy in Boise. Home sales are picking up here in SoCal but only in foreclosures which will lead to a continuing slide in pricing and a limited amount of people able to leave the state.
It has been almost exactly one-and-a-half years since the last post on this thread. I thought it might be fun to revisit some of predictions from earlier posts, and I saw this story today in the local newspaper:
Treasure Valley housing downturn isn't over yet | Idaho Economy | Idaho Statesman (http://www.idahostatesman.com/2010/08/14/1302722/treasure-valley-housing-downturn.html - broken link)
For the record, I think residential real estate prices in the treasure valley will fall AT LEAST another 5-10% in the next year. High end homes (greater than >$400K) will decline about 10%, while low end homes (<$150,000) will decline about 5%.
It has been almost exactly one-and-a-half years since the last post on this thread. I thought it might be fun to revisit some of predictions from earlier posts, and I saw this story today in the local newspaper:
Treasure Valley housing downturn isn't over yet | Idaho Economy | Idaho Statesman (http://www.idahostatesman.com/2010/08/14/1302722/treasure-valley-housing-downturn.html - broken link)
For the record, I think residential real estate prices in the treasure valley will fall AT LEAST another 5-10% in the next year. High end homes (greater than >$400K) will decline about 10%, while low end homes (<$150,000) will decline about 5%.
Sounds like the same boat the rest of the nation is in. I'm just glad to be living in an awesome city like Boise regardless if values are facing issues, I would much rather live here with a struggling home market than living somewhere else and experiencing the same scenario that is taking place in almost every other city in the county , I have no plans to sell my home anytime soon and life is good.
So much for Obama's miracle plan to save the nations housing market and economy.
Last edited by TohobitPeak; 08-14-2010 at 12:36 PM..
I was the OP on this almost three years ago and pretty much everyone thought that we would bottom out last year. Looks like at least another two years before things start pointing upward. My house is worth about 20% less than what I paid for it and about 30% off the peak value a few years ago.
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I meant to say that 
