Keep your eye on the inventory levels as one of the main factors that will effect the market in Boise.
As previously mentioned, the new construction inventory has been decreasing and developers aren't interested in losing any more money, so you'll see fewer and fewer new home starts, especially this winter.
But, as the new construction inventory dries up, it's going to force more activity towards the existing home market which will also help eat up some inventory there. Once inventory levels drop below a certain threshold, say, a 5 month supply, you'll start to see prices in certain areas stabilizing and perhaps going up in value.
Don't expect to see any enormous jumps in value but get ready for higher values and more importantly, more sales in the next year.
Also, we have seen an increae in buyer activity in all price ranges. The buyer confidence seems to be holding a big stake in the situation, but with that pent up demand and decreasing inventory you will see a better market soon. I wouldn't use the word jump though.
I have some great visual charts at my site for the Boise area, check them out!!! http://boiserealestatesoup.com/2008/11/17/boise-real-estate-
I wish I had a crystal Ball so I could answer your question. The fact is, nobody knows right now. But, prices are very, very good and here is how I know they cannot change to the lower for very much longer. The prices we are at right now are unsustainable when looking at new construction. If you just look at lot prices, you can start to see that we are at a point where it no longer makes sense to be a developer. A typical R4 lot (four lots in 1 acre so quarter acre lots) cost about $30,000 just to build (utilities, streets, sewer, etc). Now if the developer was to get an amazing deal and buy the land at $20,000 an acre that lot would now cost him $35,000 with no profit. R4 Lots in some areas are selling for less than this now.
The reality is that some developers in Eagle paid over $160,000 per Acre! So, for a majority of developers, current lot prices are either a break even or a loss situation. Then, the same thing is happening to the builders. What it costs them in labor and materials is a set cost. Problem is, the market is saying the homes are worth 5,10,15K less than what it cost to build the home. That is a function of the costs of lots dramatically reducing over the past 2 quarters (remember a home completed today was built on a lot bought about 6 months ago).
So, what I see happening right now is unsustainable in my mind. If the developer, the Builder, and the Realtors all can't make money because the prices have gone below costs, then they all stop - and we are seeing that. Building permits and applications for new subdivisions are WAY down - way past our historical averages. So, we must be at or near some sort of bottom because the law of supply and demand will eventually kick in. If there is no more re-supply, then demand will outpace availability at some point sooner rather than latter.
Ultimately we need to get back to looking at a home purchase as a long-term investment...not a 2 year turn and burn. If you were to buy a home today and plan on staying at least 5 years, I would be confident in telling you the home will be worth more in 5 years.
If you have any questions or would like to discuss this further, please feel free to contact me!
This is part one of assessing the current market conditions and addresses the "depends" issue head on.