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March 2007 Boise, Meridian, Nampa, Caldwell Real Estate Market - Builders Hold 46% Of the Inventory
Posted by Heinrich Wiebe in Fizbomap, For Sale by Owner, News on February 25th, 2007
In an effort to feed the real estate information hunger, we dug-in over the weekend and found some interesting bits of data to ponder here in the Treasure Valley.
Our results are from the Intermountain Multiple Listing Service (IMLS). We searched Ada and Canyon Counties; all housing for sale, any age.
We wanted to illustrate and analyze the distribution of housing for sale in the Treasure Valley based on age. The reason for this search is our assumption; we believe builders are holding a significant amount of inventory and that could spell trouble.
Here’s why: Spring is not yet here, and we predict homeowners looking to sell will begin to hit the market very soon. This could produce a glut of homes for sale, and the market might become a buyers market. Or worse (for sellers), homes prices could fall. With that said, here’s what we found:
Total Inventory Available For Sale - 6,657.
This is a stable number historically (reflecting back three years, before our market exploded). To illustrate an instable number, we need only look back to spring 2006. At that time, there were roughly 3,300 homes on the market (March 2006). Our explanation for this low inventory is because the market had “been purchased”. Most of what was sold was priced under $275,000; the price range that most buyers can buy. This buying frenzy left mostly expensive home on the market and thus drove housing prices up at an accelerated pace because affordable housing was all but gone.
The distribution of our findings can be seen in this bar chart:
The YELLOW, ORANGE and RED columns represent homes that builders want to sell. When you combine these three columns of available inventory not yet sold (2,917 houses), it makes up a whopping 46% of the total! Remember, this is before the spring push by regular home sellers looking to upsize, downsize or just move-on.
As you can see, spring could be a muddy and bloody time if buyers don’t show-up to solve the problem carried by builders. Trust that we’ll continue to monitor as this story develops. One thing’s for sure, if sellers/builders want to become more price competitive, they can always look to Fizbomap!
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