MARKET & TRENDS
PACIFIC NW SPOTLIGHT
An associate broker with Ist Place Realty and a real estate investor, Cameron Williams char- acterizes what’s happening in the Boise market at present as “crazier than last year” though investors continue to come in to the area particularly from California. Home to a population of 217,000 people, Boise topped Forbes list for the fastest- growing cities in the country for 2018. “Between Boise and Nampa (the metro area) including Twin Falls, we have around half of the state [popu- lation] here,” said Donald W. Holley, emeritus faculty at Boise State Uni- versity’s Department of Economics.
coming from all over. For a small area, there’s been a lot of in-migra- tion and not a lot of out-migration.” And that population increase has been putting pressure on the hous- ing market for a long time. Holley noted that prices on existing homes have been rising an average of 11.4 percent per year since 2011, while prices for newly constructed homes have seen an annual average of 9.3 percent over the same time period. While it has some of the fastest-ris- ing home prices, the area’s incomes are not keeping pace, despite an unemployment rate of 2.4 percent as of April 2019. As Holley explained, the state is a relatively low wage area with cheap labor, much of which is not well educated nor highly skilled. While it might be cutting into the investment business of small
investors, the increased demand for housing in the metro area is being satisfied by another source — commercial developers building multifamily product. “I’m amazed at the number of apartments being built,” Holley said. “Multi-family dwellings, three or four stories, 100 up to as many as 200 units. It seems to be occur- ring all over the city. Much more so than in the past.” Still, investors are doing what they can to find deals despite the hard- ships the market is throwing at them. “There are still off market deals out there,” Williams said. “They’re out there but investors are digging hard for them. Direct mail is still working in this market.” While there is plenty of money available from hard money lenders
Boise City, ID Portland-Vancouver-Hillsboro, OR-WA Seattle-T coma-Bellevue, WA 2010 $135,000 $222,000 $284,148 2011 $124,229 $200,000 $244,605 2012 $141,314 $211,000 $258,000 2013 $167,887 $242,701 $295,000 2014 $174,563 $260,000 $315,000 2015 $186,202 $280,000 $340,000 2016 $202,488 $315,000 $368,000 2017 $221,000 $347,000 $410,000 2018 $250,000 $372,000 $449,950 MEDIAN SALES PRICES “In total, about 20 percent of the immigrants coming here are from California and 12 percent are coming from Washington state. The rest are
Prospecting for Opportunity
BOISE CITY, ID
HOW THE PACIFIC NORTHWEST IS FARING AMIDST SUPPLY AND DEMAND.
Median Sales Prices
Seattle-Tacoma-Bellevue, WA Portland-Vancouver-Hillsboro, OR-WA Boise City, ID
by Joel Cone
s in many parts of the coun- try these days, there are
and Seattle will continue to be pop- ular choices for investors looking for somewhere to park their money despite rising home prices and unbalanced inventory levels.
Matthew Gardner, Chief Economist at Windermere Real Estate. “Are Seattle and Portland continuing to suffer from housing affordability? Certainly, they are for several rea- sons. They are running out of land. They’re not building enough housing to meet immigration growth, and we have more demand than supply.” Likewise, Boise is having its share of problems dealing with its own land use issues and lack of available housing while its popula- tion numbers continue to increase. Still, given that housing afford- ability — and homelessness — are genuine concerns, the question remains whether Boise, Portland,
still deals to be had in the Pacific Northwest region, a favorite region for investors looking to purchase property at far below the inflated prices of places like California and New York. However, current market conditions demand that investors be increasingly creative in their pros- pecting for those opportunities. With the Great Recession over, the times of bargain basement priced properties in the Pacific Northwest (PNW) are in the rearview mirror. “From a regional aspect, we con- tinue to see migration from Califor- nia to Washington and Oregon,” said
BOISE: TOUGH BUT NOT IMPOSSIBLE
The economic indicators for the Boise metro area are enticing for real estate investors. Being the state capital, the overall numbers look good for future growth in both population and jobs. But, the real estate market is in high demand and short on supply, making it a tough market to find deals.
88 | think realty housing news report :: august / september 2019
thinkrealty . com / hnr | 89
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