Is now a bad time to buy a single family home?

Question

I am currently looking for a single family in the Boise area, but I am starting to get worried about the possibility of the bubble bursting.

John Collins · Answer

The bubble is going to burst and was on it's way to doing so because growth can never be infinite without the environment letting us know who is boss.

But that doesn't mean you shouldn't buy, on the contrary, you should be a lot more aggressive in offering below market.

John Warren · Answer

@Hunter Phillips what makes you think your market has a bubble? Most markets have just now recovered to pre 2008 pricing which puts them more or less in line with where we would expect them to be based on historical averages. Prices do go up over time, and there will always be ups and downs. I tell my clients here in Chicago to buy for the long term and to focus on good quality buildings. Short term ups and downs should be more or less ignored unless you can pull cash out to re-invest when prices are up.

Ian Walsh · Answer

There are deals in every kind of market.  It depends on how well you know your market and what to look for.  If you are asking the question you are asking, it is likely risky for you to buy until you know more about your market.

Aaron K. · Answer

Depends what you plan to do with it, if you want to flip yeah it is probably not a great time, if you want to live in it then as long as you have a steady job and employment and plan to stay there a while you'll probably be fine.  Could you kick yourself in 6 months because prices go down? Yes. Could you kick yourself in 6 months because prices recovered? Yes.  As long as it is a low risk purchase you'll most likely be fine.

Aaron K. · Answer

@Hunter Phillips yeah now is probably a pretty decent time to buy a primary as you will face very little competition from other owner occupants and many primary residence choices don't make great investments so you might not have much competition there either.  People that need to sell may take a healthy discount especially if current events continue.

Summer Aston · Answer

Hello Hunter,

I hope you weathered the earthquake here in Boise alright yesterday.

I’m a Realtor in Boise and so far, the responses have been correct. Our market is slowing for sure, but home prices are holding as inventory is so low. What determines if this is a “good time” for you to buy is all about your own motivations and if the numbers make sense for you.

We have a couple scenarios here.

1. Is that, if this pandemic lasts in our country just a couple more months and the economy gains strength quickly, when it ends, prices on homes in our market could quickly rise as all the people waiting jump back in the market, and our inventory is so low.

2. It lasts long enough we see it begin to impact people’s ability to pay mortgages, inventory could increase, prices could drop.

No one knows. This is not like 2008, however. So even if home prices begin to drop, in general, don’t expect a rash of short sales because most homeowners in our Boise market have a huge amount of equity compared to 2008. Also, in 2008, we had about 4500 homes on the market in our area- now we have about 1000, and that number is dropping at this point in time. So as long as that inventory is so low, and interest rates remain low, even if demand is lower than it has been, the prices should hold- for now. Maybe that will change in a few weeks- again, these are unprecedented times that are difficult to predict.

One thing on your side, as a Boise local, is that the majority of the out of state competition for SFH is on hold right now. So, if the numbers make sense to you, you need a home to live in, you can afford it no matter what the market does, it offsets what you might currently be spending on rent, or any other such factors, this could be an ideal time for you, personally, to buy.  You will not be competing with as many out of state cash buyers.

Buyers, sellers, and investors are all over the board right now in Boise as to what they “should” do. Many are proceeding to take advantage of less competiton and low rates. Many are waiting. You have to make the choice based on what is best for you. One thing we know, rents are here to stay. So if you are currently renting, paying someone else’s mortgage while you “wait” another year or so is costing you possibly more than the prices “might” drop in Boise.

If you do decide to buy, keep in mind that some things have changed in regards to qualifying for mortgages-so make sure you are working with a very knowledgeable local lender- new info is coming every day. Also, expect agents to show you virtual video tours of homes, if they are occupied, so that you only physically enter homes you are serious about. And in Idaho, we do have a new Covid 19 form that can help cover some risks created by the pandemic. Oh and expect a minimum of a 60 day close. And, this information is relevant today, possibly tomorrow, but could change again. So make sure you are in daily contact with your agent.

Ultimately you’ve got to make your choice based on what works for you and not Based on fear or speculation. Do the numbers and lack of competition work for you right now? Then go for it.

Good luck, Hunter! It’s an interesting time for sure, but life still moves forward. Feel free to message me if you want to discuss further.

Jay Helms · Answer

@Hunter Phillips never a bad time to buy something that fits your criteria. Do you disagree?

Jacob Sampson · Answer

Yep.  It is always a good time to buy.  The price you pay is what makes it a good or bad deal.

Charlotte Casey · Answer

We’ve been trying to buy for 2 years now and lost dream houses to bidding wars that soared $200k over asking.  We just got an accepted offer on a family home that we love and under asking.  So as an agent myself I just have to calm my fears by reminding myself that’s I know this market, I love this house, we probably wouldn’t have gotten it without a war in our normal market and we are it for the long term even if the market dips.  And hoping we can improve our monthly payment by locking at a great rate....good luck!

Ryan Hall · Answer

@John Collins

To original poster, read John Collins post please.

John is right on the money, economy was slowing in Dec 2019, global pandemic was spark that ignited the fire. Lay offs and record unemployment will hit housing, and have a negative affect.  If you have to make an offer now, offer far below asking price.

If you want a treasure valley multi-properties land lord’s unbiased view on treasure valley market vs. a realtors, feel free to IM me.

Is now a bad time to buy a single family home?

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