BOISE, Idaho — Editor's Note: The video above originally aired on February 21, 2021, and focuses on Idahoans being priced out of housing while wages stay stagnant.
While the housing crisis in the Treasure Valley, which is now reaching rural Idaho, is seemingly impervious to the economic effects of the coronavirus pandemic, it isn't heating up alone in a vacuum. With more people leaving states that are home to some of the nation's biggest metros, such as California, Illinois and New York, cities' housing markets across the West are also skyrocketing.
The real estate market has been booming across much of the U.S. in the last year. However, Boise's market continues to be one of the hottest markets in the West with the median home price surging 72% in four years.
If anything, the COVID-19 pandemic exacerbated the area's housing woes, with more people lured to the City of Trees from major metro areas, such as San Francisco, as people sought more affordable remote-work housing and an outdoor-centric work-life balance.
In order to get a better sense of how Boise's housing market stacks up to other major cities across the West, KTVB created a virtual tour comparing real estate listings in Boise to a dozen other cities. Scroll down to see the interactive West Coast housing tour.
However, before comparing the Treasure Valley's housing market to a dozen cities throughout the West, it's crucial to understand how the valley's housing market tanked a decade ago and started its unstoppable rebound just a few years ago, and how local leaders and lawmakers are responding to the crisis.
During the 2021 legislative session, lawmakers passed a last-minute property tax cut bill. Idaho Republican Governor Brad Little said he signed the bill to provide relief to Idaho taxpayers, but questioned if it would do any good for homeowners amid skyrocketing property values.
"I fear the long-term consequences may outweigh this temporary reprieve," Little said after signing the bill into law.
Renters looking for assistance from the statehouse were also left empty-handed during the last legislative session. Idaho lawmakers aimed to end all forms of rent control with Idaho House Bill 45, which was sponsored by Rep. Greg Ferch (R-Boise).
Ferch, a property manager, said the bill would stop cities like Boise from instituting rental application caps. Several property managers from across Idaho supported the bill, which aimed to block any local ordinances to regulate rent, fees or deposits for residential leases.
House Bill 45 eventually went nowhere in the statehouse and didn't pass, but the effort sent a chilling message to some Idahoans who are being priced out.
'It's not something that is just happening in Boise'
It's the largest continued climb of housing prices in the Treasure Valley since before the 2008 Great Recession.
Boise Regional Realtors CEO Breanna Vanstrom told KTVB that the Treasure Valley's housing crisis isn't an isolated situation, with cities across the country experiencing growth and the crunch of low housing inventory.
"It's not something that is just happening in Boise," Vanstrom said. "Certainly people are finding Boise more than ever, so it may feel like it's only happening here, but it's really something that's happening across the country."
She added that there are just "not enough homes available for sale" considering the number of buyers and population.
And Idaho's population keeps growing. Some Idaho cities had the fastest U.S. growth rate between 2019 and 2020.
Nevada (146.3%), Utah (126.2%), Arizona (116.5%), Colorado (111.6%) and Washington (108%) also saw their total housing market value more than double over the past decade.
While states across the West are seeing home values climb due to sky-high demand, the Treasure Valley's housing market looks more akin to a massive metro area than the small college city that it was just a few years ago.
'This is Denver ten years ago'
Jeff Wills, a real estate agent and president of the Boise Regional Realtors board, said that he's heard of plenty of comparisons between Boise and other cities in the West.
Most notably, the Boise community is grabbling with the growth that other neighboring markets have already gone through, Wills said.
"I mean, I can't tell you how many times I hear people say, 'Oh, you know, this is Denver ten years ago; this is Salt Lake City, 15 years ago,'" Wills said.
But how exactly does Boise's real estate compare to those other cities today?
To create a virtual real estate tour across 13 west coast cities, KTVB used Zillow.com to find a larger home in a historic neighborhood, a modest single-family home and a two-bedroom apartment near downtown or by a university.
Postings on Zillow had to have multiple photos, a photo of the exterior of the building, no personal vehicles parked in private driveways visible, and clearly stated square footage in order to be used. The homes and apartments shown in the virtual tour are just a sample from each city and are not indicative of the entire housing market.
However, the listings do begin to show that the City of Tree's high housing costs rivals some of the biggest metro areas west of the Mississippi River, including Austin and Las Vegas.
Click or tap on the "Listed price:" in the photo captions to open a new tab of the listing.
To open a new tab of just the map, click or tap here.
'The dynamics are completely different'
For those who believe the current housing market bubble will pop like during the Great Recession, the causes of the current rise in home prices are much different than in 2008.
"The dynamics are completely different," Vanstrom said.
In 2008, the Treasure Valley had an abundance of supply with a lot of new construction and existing homes on the market.
"We just do not have that level of inventory available right now," Vanstrom said.
Vanstrom explained that mortgage lenders have also drastically changed how they distribute loans between the years leading up to the recession and now.
Different lending standards mean some people who qualified in the past, before the recession, wouldn't be able to get a similar loan today.
"It was just a completely different credit market and since then a lot of that has changed," she explained.
Some of those loans, Vanstrom explained, didn't require people to provide proof of income.
The housing crash of 2008 was fueled by lenders granting subprime loans to people who were then forced to foreclose their homes once the economy began tanking and people started losing their jobs. Foreclosures sky-rocketed, putting more inventory back into the housing market than there was a demand for.
"We're not seeing the kind of risky lending practices today that we were back then that really caused a lot of concern," Vanstrom said.
'I don't foresee it changing'
According to data collected by Boise Regional Realtors, the median home sale price in Ada County peaked at $239,400 in August of 2007. By April of 2011, it hit a decade low of $135,000. It wouldn't be until November of 2015 that it surpassed the pre-Great Recession peak with a median of $240,000.
In May 2020, less than five years after the housing market rebounded from the Great Recession, the median home sale price in Ada County hit $500,000.
Vanstrom said there isn't much worry amongst experts about another housing bubble.
"At this time, we're still seeing, because home prices are rising and people have a lot more equity in their homes today maybe just before, nationally, economists aren't too concerned about massive foreclosures or something like that coming," she explained.
Currently, near record-low interest rates on mortgages are opening the door for more prospective homeowners to close a deal on a house.
'A massive hangover from the Great Recession'
According to Dr. Darek Nalle, an economic expert and director of the Barker Capital Management and Trading Program at the University of Idaho, the current housing crisis is part of the aftermath of the Great Recession.
"The number of new starts, housing available since 2008, has been on the decline as demand has been going up. We are suffering, greatly, from a massive hangover from the great recession," Nalle said.
He added that he doesn't see a ceiling for the area's housing market.
"I know this is also about wages and affordability but frankly you have to follow the money and the money is flowing in from, by and large, out of state," Nalle said.
Nalle told The 208 that the root cause of the lack of inventory can be traced back to the Great Recession.
"The home building industry was decimated and it's once bitten, twice shy. People do not want to race into a market where a lot of people literally lost their shirts and businesses," he said. "This is here to stay."
Moving forward, there aren't any easy paths out of the housing crisis that has ensnared the Treasure Valley for the last few years. Building more housing to meet growing demand is an obvious solution, but with developers running into lumber, labor and materials shortages, the timelines for new housing have stretched from months to more than a year.
Wills said he has clients ask him all of the time if he anticipates the current housing market in the Treasure Valley cooling off but without a crystal ball to see into the future, he sees no end in sight for the current housing situation.
"I don't know, number one, I wish I did. Number two is, with everything that I know in regards to the economic forecasts of growth in our valley with the logistics around supply and demand that we're currently dealing with, and then adding on top of the supply and demand issues, the growth that we're projected to have, I don't foresee it changing," he explained.
Wills said unless 10,000 housing units appear in the market in the blink of an eye, the housing market won't likely change in the near future.
"I don't think, this is generally speaking, that we've seen any change of growth coming anytime soon based around people transitioning away from bigger markets, or allow them to work from home, and then too, I think there's just a variance around growth from people who had time to reflect on where they wanted to be living at during COVID," he said.
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