From ‘no way’ to ‘thank God’: Homebuyers take advantage of Boise’s falling prices

Pawnee Green worried her rent would rise. Her lease lasted through August. Green thought it made sense for her and her husband, Kelly, to buy a home before then. Or at least try.

“I thought we’re never going to be able to buy and afford a house here,” Green said.

In early June, they dug in. They looked at seven houses, put in an offer on just one. The two-bedroom, one-bathroom house in Northwest Boise was listed at $359,000. They offered $352,000.

No bidding war. No risky concessions. No rush to make a snap decision in the heat of the moment.

“The market, thank God, came down,” Green said by phone.

After two years of exhaustive competition among buyers, the Boise area’s housing market has cooled off. The experience of buying a house is now much more relaxed and free of frenzy.

“People can make good decisions,” Boise Regional Realtors President Becky Enrico-Crum said by phone. “They’re not making desperate decisions.”

First-time homebuyers, or ones like Green, are positioned to benefit. They were often squeezed out when competing buyers were offering to pay cash and offering more than the list price. Buyers now have more chances to buy under the list price and persuade sellers to pay for closing costs.

“Six months ago it would have been $450,000 for that small little house because of how the market was going,” Green said. “So the fact that in six months, there actually was an opportunity for us to go ahead with it, it was really nice. It sucks for a lot of people that were selling, but it worked out in our favor.”

Boise real estate market cools

The median price of an Ada County home peaked at $602,250 in May, according to the Intermountain Multiple Listing Service. The price then dropped to $592,090 in June and again to $589,990 in July.

Signs had been pointing to a cooling market before that. Boise-area homes’ profit margins dropped significantly by the first quarter of this year. Sellers reduced their list prices more frequently in April. A financial analysis company predicted in June that price drops were on the way.

Lower prices haven’t guaranteed more affordability. A 30-year, fixed-rate mortgage rate is 5.6%, according to mortgage buyer Freddie Mac. It’s a steep increase from when rates were in the 2-3% range in 2020 and 2021. But those were all-time lows, and the current rate is on par with what rates were like in the 2000s before the Great Recession.

By definition, Boise is still a seller’s market. In July, there were 2.8 months of inventory in Ada County, according to the Boise Regional Realtors. That means if no more homes came on the market, it would take 2.8 months for the supply to run out. Inventory of four to six months is considered a balanced market.

Still, it’s the largest inventory since September 2015.

“The opportunity for buyers is wonderful,” Enrico-Crum said, “because now they get some houses to choose from and they get to think about things, they get to ask for a home inspection and appraisal. If they’re getting a home inspection and an appraisal, then they’re able to buy a house that’s at market value.”

When first-time homebuyers were priced out, real estate agents often suggested they look elsewhere in the Treasure Valley. Since more homes are on the market and competition has eased, Enrico-Crum said buyers can be more selective about their locations.

If a client wants to live near the Boise Foothills or the Greenbelt, Enrico-Crum thinks she can help more than she could six or 12 months ago.

“Those opportunities are back,” Enrico-Crum said.

First-time homebuyers face less competition

Once a month, real estate specialist Kelsey Cunningham hosts a class for first-time homebuyers at Lost Grove Brewing in Boise.

The Greens previously bought a home in Portland in 2002 but were new to buying in the Boise market. So they attended Cunningham’s class in early June.

Cunningham encourages any buyers looking for education about the market to attend. Green, for example, qualified as a first-time homebuyer because of how long it’d been since the last time she owned a house.

The Greens had been renting in Medford, Oregon, before moving to Boise in December 2020. As empty nesters, they didn’t need much space. They initially signed a nine-month lease to live near the Boise Towne Square mall. Then they moved to another rental on the Boise Bench near the intersection of Franklin Road and Orchard Street.

As prices started to fall, Kelly Green was still doubtful. Kelly and Pawnee had become used to assuming they couldn’t afford anything.

“(Prices) went down so significantly, it actually gave me hope that we could afford it,” Pawnee Green said.

That’s why Cunningham hosts the class, along with colleague Courtney Emerson and Churchill Mortgage loan officers Carli Zismer and Megan Letsinger.

A few weeks after attending, the Greens knew they’d be moving near State Street off Gary Lane. They closed on the house — the one they offered $7,000 below the list price — in late July.

“This is really the time that if they’re ready, they’ve been sitting on the sidelines, because prices were so high,” Cunningham said by phone. “Now they can start thinking about it a little bit more.”

Green said her mortgage is about $2,500 per month, double her previous rent. It’s a bit of a stretch for Pawnee, who works in accounting for an information technology company, and Kelly, who’s a glass industry wholesaler, Pawnee Green said. But the monthly payment won’t go up, they’re building equity, and the couple lives in a desirable location.

“It wasn’t necessarily the prices. It was the competitiveness. People having this $60,000 to go over asking, and our first-time homebuyers just don’t have that,” Cunningham said. “Now that it’s not competitive, we’re getting under contract. They’re getting the house they want. We’re able to get them under list price.”

Locals buy home after thinking ‘no way possible’

To scope out more affordable places to live, Lauren Smith and Clint Vaughn quit their jobs in February 2021 and lived out of a camper while traveling around the Northwest for eight months.

Smith grew up in Boise. Vaughn grew up in Fruitland. They’re planning to get married in September.

“We truly thought there would be no way possible we would be able to find something, one, within our price range and, two, that we liked,” Smith said by phone. “We were super stressed.”

So they explored throughout Washington, Oregon, Idaho and Montana. They spent the time skiing, rock climbing, fishing, backpacking and hiking. And thinking about where they might want to live next.

Nowhere matched Boise.

Smith and Vaughn considered places in East Idaho like Victor or Driggs, but prices in those attractive towns near the Teton Range were high too.

“If we’re gonna spend the money,” Smith said, “we’d rather do it close to the people in our lives.”

The couple aimed for a three-bedroom house that cost $450,000. They live with their two dogs, Copper, a German shepherd, and Thistle, an Australian shepherd, and Smith works from home.

When they settled back in Boise in October, they lived in a camper on the property of Vaughn’s boss. They knew they had to figure out their long-term living situation. And they had heard stories from friends about how nightmarish it was to compete in Boise’s smoking hot housing market.

They met with Cunningham and Churchill Mortgage’s lenders to figure out how they’d make it work financially. Smith works in software sales, and Vaughn is an electrician.

Smith and Vaughn looked at a handful of options and put in an offer for a three-bedroom house in the Collister neighborhood off State Street. The price had been dropping. And the couple took advantage. The $470,000 price tag was above what Smith and Vaughn hoped for, but renovations had recently been completed, and the house is just a block away from where Smith’s parents live.

“Super lucky,” Smith said.

It was December, and a sign of things to come.

Smith had spent much of her adult life renting in Boise’s North End. In April, the median price of a North End home was more than $1 million. Locals, like Smith and Vaughn, often can’t afford to buy a home there. The neighborhood doesn’t have the same feel anymore, she said.

“Owning a house has been a great experience for me,” Smith said. “I wish that in Boise it was more achievable for everyone to do just that.”

Buyers’ new reality

After a client’s purchase is official, Cunningham enjoys celebrating by sharing a margarita on the buyer’s back porch. Smith and Vaughn celebrated by popping a bottle of champagne in their new living room.

Green didn’t want to celebrate until the home sale was official. It still took a few days to sink in. She didn’t want to jinx it. After years of dizzying price increases and a whiplash-inducing environment, things have finally calmed down.

Like Green, buyers’ new reality is setting in.

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Homebuyer classes

• Hops ‘N Homes typically takes place on the first Tuesday of each month at 6 p.m. at Lost Grove Brewing, 1026 S. La Pointe St., Boise. In September, it will take place on the second Tuesday because of Labor Day. Website: www.hopsnhomes.com
  
  

• Idaho Housing and Finance offers monthly homebuyer education classes. Website: www.idahohousing.com