Mortgage Rates Dip to 15-Month Low, Home Prices in Ada County Tumble
Posted by Lisa Kohl on Saturday, August 10th, 2024 at 2:28pm
The Treasure Valley housing market increasingly favors buyers as home prices decline and mortgage rates drop to their lowest levels in over a year.
The average 30-year mortgage rate fell to 6.47% for the week ending August 8, the lowest level since May 2023. Homebuyer demand typically shrinks when rates rise above 7% and picks up when they fall below that threshold.
Even small changes in mortgage rates can significantly impact home affordability. For instance, a buyer who put 20% down on a $500,000 home in April would have faced a monthly payment of about $2,750, excluding insurance and property taxes. Today, that payment would be closer to $2,480.
Federal Reserve Chair Jerome Powell recently suggested that a rate cut "could be on the table as soon as the next [Fed] meeting in September." Although the Fed doesn't directly set mortgage rates, its decisions influence investor expectations, which can affect long-term loan rates, including mortgages.
In Ada County, the median house price fell to $545,000 in July from $569,990 in June, marking the largest monthly decline in over a year. Despite this drop, prices are still 0.9% higher than last July. In Boise, home prices fell to $525,888 from $556,500 last month, nearly matching levels from a year ago.
Sales usually close one to two months after a contract is signed, so July's sales reflect decisions made when interest rates were near their highest point of the year. A greater number of lower-priced homes were sold during the month, contributing to the overall decrease in the median sales price.
Home prices in Canyon County, which have seen a slower and steadier climb this year, finished the month at $424,900. This figure is almost unchanged from the previous month and represents a 4.9% increase compared to last year.
In 2023, property sales in the Treasure Valley plummeted to their lowest level in nearly a decade. After a brief uptick in early spring of this year, sales slowed again as volatile interest rates and high purchase costs kept buyers cautious. However, recent weeks have shown signs of pent-up demand, which lower mortgage rates could help unlock.
In addition to falling rates, the supply of homes for sale has steadily increased as resale sellers are returning to the market. The active inventory of homes for sale is up 30% compared to a year ago. However, with only 2.83 months of supply, the market is still undersupplied.
Another factor contributing to the higher inventory is that homes take longer to sell. In Ada County, the median time for a home to sell increased from 17 to 21 days, while in Canyon County, it rose from 15 to 30 days.
Overall, the Treasure Valley housing market is gradually moving toward balance. While it’s not yet fully balanced, the days when sellers could dictate terms to buyers appear to be over. More options and increased purchasing power are welcome signs for potential homebuyers.
Boise Real Estate Market Summary for July 2024
- Median list price: $539,900, up $10,900 (2.1%)
- Median sold price: $525,888, up $888 (0.2%)
- Average price per square foot: $313 (up 2.2%)
- Total home sales: 273 (down 4)
- Median days on market: 13 days (up 2)
- Available homes for sale: 2.33 month supply (up 0.6)
- 30-year mortgage rate: 6.85% (up 0.01)
Treasure Valley Housing Market by Area
- Ada County: $545,000, up $5,000 (0.9%)
- Eagle: $790,202, up $30,302 (4%)
- Garden City: $479,000, down $104,500 (-17.9%)
- Kuna: $437,459, down $32,531 (-6.9%)
- Meridian: $525,000, down $2,768 (-0.5%)
- Star: $525,000, down $22,385 (-4.1%)
- Canyon County: $424,900, up $19,910 (4.9%)
- Caldwell: $402,657, up $36,381 (9.9%)
- Middleton: $508,800, up $86,900 (20.6%)
- Nampa: $414,000, up $1,010 (0.2%)
Lisa Kohl
Lisa carefully studies the local housing market to give her clients the edge when buying or selling a home in Idaho. We Know Boise is a full-service real estate team that combines our LOCAL expertise with traditional know-how to create exceptional results for each of our clients.
More From Our Blog...
Select information in this We Know Boise market report was obtained from the Intermountain MLS (IMLS) on August 8th, 2024. While the data is deemed reliable, it is not guaranteed. City-specific data refers to single-family homes on less than one acre, whereas county-level data includes homesites of all sizes. The "months of supply" metric is based on a 12-month rolling average. Home prices mentioned combine both existing and new construction properties. Comparisons are based on year-over-year changes unless otherwise specified.
Leave A Comment