While our region has faced insufficient supply for years — the main driver of home prices — June marked three consecutive months of inventory growth. While still low compared to previous years, there were 729 homes available for sale at the end of the month, up 27.9% from May.
After home prices rose above the $500,000-mark last month, homeowners may have been encouraged to list in June, as existing/resale inventory was higher than the previous month and year for the first time since March of 2020, just before the pandemic put the brakes on the Spring market. At the end of June, there were 485 existing homes available for purchase, up 27.0% from May 2021 and up 10.7% from June 2020.
Analyzing weekly listing activity, we saw a jump in the number of existing properties coming onto the market starting the week of June 6th. Listing activity has been much higher than 2020 (expected due to the COVID-related restrictions in place at that time) and mostly ahead of 2019.
Despite more inventory, the speed of the market reached a new low, as the average number of days between when a home was listed for sale and an offer was accepted dropped to 10 — two days faster than in May 2021 and 22 days faster than June 2020.
That said, low inventory does not mean no inventory.
While buyers have access to listings from a variety of real estate websites, we often hear from people who find a home they like online, but by the time they reach out to a REALTOR® for information, the home has already gone under contract. While the recent uptick in listing activity is very positive, you still have to act quickly. Your REALTOR® can help you secure a showing, submit an offer, and alert you to existing properties that may be available soon, or, if you have time to build, they can identify new construction options that haven't yet broken ground.
Connecting with a lender and getting pre-approved before searching for a home is also imperative for buyers using a mortgage. In June, nearly 70% of existing homes sold for more than the original list price — another factor behind rising home prices. On average, buyers paid 6.8% more than the original list price on existing homes. Knowing how much you're able to borrow allows your REALTOR® to search within a price range to help stay on budget if you're shopping for homes that tend to go over list price, or possibly a bit higher if there's room to negotiate. For the 30% of existing homes that sold for less, buyers and their REALTORS® were able to negotiate 3-5% off the original list price, on average, depending on price point.
Current home prices and competitive market conditions can be challenging for those looking to get into the market, particularly at the lower price points. Some may decide to wait a while before starting their home search or continue to save for a down payment to improve their purchase options, while others may consider expanding their search area for homes farther from the Boise metro. But for those who are ready to buy, we want to stress that while it may take more work right now, it's not impossible. There are hundreds of home sales each month and REALTORS® are there to help guide buyers and sellers through the fast and complex process.
In each of our reports in 2021, BRR is focusing on the various phases of a real estate transaction to help consumers be prepared before, during, and after a real estate transaction, showing them what their REALTOR® will be doing for them along every step, and the key data points they can look for to make sense of the market.