Learn more about the housing market in Idaho

Every state is unique when it comes to real estate market dynamics. That’s why it’s critical to understand the market you live or operate in. Whether you’re renting, buying, or selling, it will impact many aspects of your life.

Idaho Housing Market Overview 

Idaho is considered one of the most rural states in the country due to its large size, relatively small population, and vast farmland. However, the state prides itself on its mix of traditional and burgeoning industry, as it is known for both energy and food production.  

After considerably higher home prices in mid-2022, the trend of remote work meant that many Idaho homeowners no longer needed to live close to their place of employment in cities, allowing them to spread across the state and avoid market congestion. This caused prices to drop, though the increasing number of prospective homeowners in the state has made the market much more competitive, which has kept prices from returning to pre-pandemic levels.  

At the beginning of 2024, the housing market in Idaho was predicted to become more competitive throughout the year, reflected by a trend in rising average home prices and an increased number of buyers on the market. The beginning of the year saw the state emerging from a period of rapid appreciation in the market, and this trend was expected to continue, albeit at a decelerated rate. Looking back on Q1 of the year, these predictions appear to have come true. 

The same article also predicts that the record-high 30-year fixed mortgage rates of around 8% would decrease and stabilize by the second half of the year. While it is too early yet to see this prediction play out, interest rates in Idaho are down considerably to an average of around 6.68% as of April 2024, meaning that the housing market may be headed for more stability towards the year’s end. 

Idaho Market Trends 

To understand the Idaho real estate market, it’s important to keep up with trends. Let’s look at some key ones in Idaho:  

Note: These statistics are based on Redfin’s monthly housing data from April 2024.  

Median Home Price 

The median sale price of a home in Idaho as of April 2024 was $477,200, according to Redfin’s monthly housing market data. Reflecting a year of great appreciation, this is an increase of 15.3% from median prices in April 2023. The Boise Idaho housing market has a slightly higher average price of $498,745, with a relatively modest increase of 2.9% over the last twelve months. 

Number of Homes Sold in April 2024 

2,295 homes were sold in Idaho in April 2024, which is a considerable 24.5% decrease from the number of real estate transactions the previous year. This accurately reflects the situation in the Idaho housing market, wherein increasing prices and a large number of prospective homeowners has made the market more competitive, meaning less sales are going through. 

However, it is important to note that nationally speaking, sales tend to peak during the spring and summer months and slow in the winter. In fact, the National Association of Realtors (NAR) predicts that in February and March alone, sales activity increases by as much as 34% and prices by 3%. 

Median Days on Market (DOM) 

Days on market (DOM) is a measure of the average length of time a home remains listed on the market before being put under contract. A lower DOM signals a highly competitive seller’s market with more pressure on buyers to make higher offers and remove contingencies. A higher DOM signals a buyer’s market as sales are slower and sellers have less leverage.  

As of April 2024, the median days on market (DOM) in Idaho is 35 days, which is down from 39 the previous year. This means that on average, property listings spend around 35 days—a little over a month—on the market before they are transitioned to pending sales. 

New Supply Statistics 

In April 2024, there were about 11.43 new construction permits per 1,000 people in Idaho. This is notably higher than the average in other states and could point to an increase in affordability for housing given the steady demand. 

Property Tax Rate 

According to Rocket Mortgage, the average property tax rate in Idaho is 0.67%. Idaho has the 14th lowest average property tax of any state in the country. However, it is important to note that Idaho is a large state, and property taxes are bound to vary depending on the value of a property and where it’s located. 

Foreclosure Rate in Q1 of 2024 

According to recent data from ATTOM, around 1 in every 2,394 homes in Idaho experienced a foreclosure filing in the first quarter of 2024. Compared to other states, Idaho is ranked 29th in homes foreclosed during this period. 

Hottest Local Markets in Idaho 

Because Idaho is so vast, there is plenty of diversity in its real estate market. Let’s look at a few of the best local markets in Idaho. 

1. Boise

Boise is the state capital and by far the most populous city in the state. As previously mentioned in this article, its median house price is slightly higher than the statewide average at $498,745. Per Redfin, Boise’s DOM is 11 days, which is much lower than the state’s median. This suggests that the housing market in the state’s capital is much more competitive than the rest of the state. Some of the most popular neighborhoods in Boise include Southeast Boise, West Valley, and North End. 

2. Coeur d’Alene

Coeur d’Alene is a city in northern Idaho known for being on the edge of Lake Coeur d’Alene and near the Washington state border. Its median home price is $555,575, higher than the statewide average. Its DOM of 30 days indicates that while prices are high, the market is not overly competitive, and buyers generally have more power than in seller-driven markets. Some of the most popular neighborhoods in Coeur d’Alene include Ramsey Woodland, Downtown Coeur d’Alene, and Northeast Prairie.  

3. Idaho Falls

Idaho Falls is a modestly populated city on the eastern side of the state. Its average house prices are lower than the statewide average at $352,500. Compared to the massive appreciation seen in Idaho recently, Idaho Falls’s average price increase is 3.7% over the past year. Its DOM is 27 days, a high number that indicates a less competitive buyer’s market. Some of the most popular neighborhoods in Idaho Falls are Ammon, Rigby, and Blackfoot.  

Economic Factors Impacting the Idaho Housing Market  

A holistic view of Idaho’s housing market requires a basic understanding of the main economic drivers affecting the market. Let’s look at a few critical ones below:  

Mortgage Rates 

As previously mentioned in this article, the 30-year fixed mortgage rates in Idaho are recovering from a high average of around 8% and are currently sitting at around 6.68%, which is close to the national average. Forecasters predict this number will continue to settle throughout the year. 

Inflation and Cost of Living  

Mortgage rates are tied to inflation, another massive contributing factor to the affordability of housing and the state of housing markets in general. Inflation has increased the cost of living and housing prices for many across the U.S., including in Idaho. This means fewer people can truly afford to limit housing costs to less than 30% of their monthly income.  

Population Changes and Demographics 

A changing population can also have implications for the housing market. The U.S. Bureau of Labor Statistics lists the unemployment rate in Idaho as 3.3%, as of April 2024, and it is ranked 23rd in the nation. This relatively lower unemployment rate means those living in the state can find employment, which is bound to attract a broader work force and impact the housing market.

Idaho Housing Market Forecast 2024 

As previously mentioned, predictions for the Idaho housing market in 2024 look to a continuing appreciation that swept the state in 2023, yet at a much slower and steadier rate. The pendulum is not exactly swinging in the opposite direction of the soaring house prices that were the nationwide norm during the pandemic, and median house prices continue to increase. However, experts predict that alongside high interest rates and prices, the Idaho housing market will continue to favor buyers, who are expected to increase as a demographic throughout the year. 

Likelihood of Idaho Housing Market Crash 

Many factors, such as the increasingly stabilized mortgage rates and the market’s incremental growth, suggest a housing market crash in Idaho is unlikely. Though the state experienced rapid appreciation in 2023, this was in response to lower Idaho home prices, and the median value has ultimately remained relatively stable in the long-term.  

Forecast for the U.S. Housing Market 

Now that we’ve looked at Idaho’s housing market, let’s zoom out a little bit. What about the U.S. housing market? What do you need to keep an eye on in the coming years?  

The United States’ current median existing-home sale price is around $384,500 per the National Association of Realtors. The inventory, though, remains low. A balanced market typically has a 5-to-6-month supply, but the current figure is 2.9.  

We’re currently in a seller’s market with buyers looking at continued rising house prices. The same trend can be seen with renters. Housing continues to appreciate, in general.  

Dr. Lawrence Yun, Chief Economist and Senior Vice President of Research, National Association of Realtors, believes the housing market will appreciate 15 to 25% over the next five years. He thinks that the seller’s market will continue because housing inventory will remain low. In five years, however, he predicts a more balanced market, in which neither party has a built-in advantage. Thus, the market will shift to a case-by-case basis to determine what kinds of deals people can get.  

Hybrid work also impacts the housing market. This shift in work culture means suburbia will continue to grow. States like Texas, the Carolinas, Tennessee, and Florida should see continual growth.  

The number of single-family homes built decreased over the past couple years while the number of multi-family homes increased due to lower prices and a demand for affordable housing. Higher mortgage rates and inflation (affecting price of materials) were the main causes.  

Lower income households continue to struggle in the current housing market. This trend appears likely to continue into the foreseeable future. Without enhanced supply or helpful subsidies, the outlook is that many Americans will still wrestle with housing affordability in the years to come.  

Idaho Rental Market 

The rental and buying market are obviously closely linked. When home prices fall, landlords are more likely to buy properties to rent out. Home prices and rental prices are correlated as well because a hot market means prices rise.  

Rents were more unaffordable than ever in 2021 and 2022. In 2022, 22.4 million households paying rent said it was unaffordable, which is the highest that figure has ever been, according to a January report from the Joint Center for Housing Studies at Harvard University. The study found that half of all renters in the United States spent over 30% of their income on rent and utilities.  

The markets cooled in 2023, though, due to new units and decelerating demand. But a serious problem persists: Rent increases are still outpacing income gains.  

Moreover, high interest rates are keeping borrowing and transaction activity down. Over half the banks surveyed by the Federal Reserve reported that demand for multifamily loans decreased year-over-year.  

The pandemic caused a housing disparity that isn’t going away anytime soon. Unaffordable housing is a serious issue across America. Whether high rents or low income is the main cause doesn’t change the fact that this problem is widespread. 

This short summary leads directly into Idaho’s current rental market. Below are just a few of the current trends for Idaho’s rental market based on data pulled from Zillow:  

Idaho Rental Market Key Trends 

• Median rent: $1,700 
• Month-over-month rent charge: $0 
• Year-over-year rent charge: -$195 
• Available rentals: 2,660 

Conclusion 

While certain parameters suggest that Idaho’s housing market is trending more competitive, it is still largely buyer friendly. Paired with its vast rural land, variety of industries, low unemployment rate, and relatively manageable cost of living, Idaho is bound to persist as an attractive location for real estate investors and buyers alike. Experts and analysts will continue to monitor this market, as well as nationwide factors like interest rates and new construction.