Though Idaho’s home prices took a beating in the last downturn, the Gem State’s home prices leaped +11.6% y/y in August 2019, according to the CoreLogic Home Price Index (HPI). That 11.6% home price appreciation increase is more than triple the nation’s +3.6% rate of home price appreciation and substantially higher than #2 ranked Utah at +8%.
On a statewide basis, Idaho’s annual price gains have been the highest for 11 consecutive months plus its average annual home equity gain of $22,000 was the nation’s highest in Q2 2019. Additionally, Boise saw its home prices jump +12.4% in August 2019.
Several factors account for Idaho’s attention-getting home price growth:
- Non-farm annual employment growth of +2.1% in August 2019. Compare the nation’s non-farm annual employment growth of +1.4%
- Population growth of +2.1% in July 2019 whereas US population growth rate was +0.6% in July 2019, according to the US Census Bureau.
- 30% of Idaho’s population growth came from California, according to the US Census Bureau.
- Californians submitted some 4 in 10 loan-purchase applications between January 2018 – August 2019, according to CoreLogic’s loan application data.
- Affordability is huge.
- In July 2019. CA’s median sale price was $495,000; Idaho’s median sale price during the same period was $265,151, or -87% lower that California.
- California loan applicants outnumbered loan applicants from all 6 of Idaho’s neighboring states.
- Idaho’s land mass is-50% smaller than California’s.
- Idaho’s population is approximately 1.8M and less than 4% of California’s total population of some 40M.
- Investors/absentee buyers purchased some 20% of homes sold in Idaho during August 2019.
Idaho had been in the #1 spot in terms of home price growth once before, during June – September 2006. Then, price growth dropped 18%-23% in 2007 and by the spring of 2009, Idaho’s home price declines exceeded that of the nation’s.
Now, however, Idaho’s home price growth stands firm although its overall housing market is cooling a bit.
- Non-farm job growth fell from 3.6% in August 2018 to2.1% in August 2019.
- Statewide sales dipped to 5.4% in July 2019 from 8% in July 20-18.
- In August 2019, inventory stood at 2.8 months.
- Oregon, Utah, Nevada and Washington have seen significant price growth decline over the past year. In Nevada and Washington that price growth decline dropped by more than 50% compared to August 2018. Will this neighboring state home price decline rub off on Idaho?