Boise newcomers are raising the typical income of homebuyers. New report says how much
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Affording Boise: Homeownership
Soaring rents. Skyrocketing home prices. The double-digit rates of increase in the costs of Boise-area housing until 2022 have created increasingly urgent problems for low-income, working-class and even moderate-income Idahoans who need places to live. Affording Boise is a series of Idaho Statesman special reports on housing. This collection focuses on homeownership. A separate collection focuses on rental homes, including apartments.
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If you’ve lost out on a bidding war for a Boise home, you’re not alone.
More than two years after Boise’s housing market entered a COVID-19-induced frenzy, it’s no surprise that recent homebuyers brought more money to real estate bidding wars than ever before.
A national real estate brokerage is now reporting how much more money the typical homebuyer had.
The median income of a Boise homebuyer increased 24.1% from 2019 to 2021, according to Redfin. That ranked No. 1 among the country’s 100 most populated cities.
“The people who benefited from those lower interest rates … were higher income, they outbid locals probably, and house prices rose very sharply, and out of reach,” Redfin Senior Economist Sheharyar Bokhari said by phone.
In 2019, the median income of Boise homebuyers was $79,000. By 2021, it rose to $98,000, Redfin reported.
The brokerage analyzed data collected by the Consumer Finance Protection Bureau under the Home Mortgage Disclosure Act,. Redfin’s report included only people who took out mortgages. Since it didn’t include cash buyers, the median income of homebuyers could be even higher.
Though the data doesn’t provide an explanation, Bokhari’s inference is that people moving in from coastal cities, where they earned higher wages, drove up the median income. Bokhari reached this conclusion based on search data on Redfin’s website, migration trends and anecdotes from people in the area.
“Over the last couple years, it was a big uptick of people, especially from Los Angeles, the Bay Area, from Seattle, looking into buying homes in Boise,” Bokhari said. “Most of it was coming in from these expensive cities on the West Coast.”
After Boise, the cities where homebuyers’ median income increased the most are Austin, Texas at 19.1% and Florida’s Cape Coral and North Port, both at 18.5%. Nationally, the typical homebuyers’ income increased 6.8%.
Jared Cook, Zions Bank’s mortgage manager for Idaho, has observed what Redfin reported. Ten percent of Treasure Valley buyers borrowing from Zions Bank for mortgages in the Boise area are employed in California, Oregon or Washington, he said. While keeping their West Coast jobs, they’re buying homes in the Boise area.
Before the pandemic, Cook said remote workers buying homes in Boise was rare. Then there was a “dramatic increase” in buyers who worked remotely, he said.
“The customers that are employed in most other states are more on the higher-end homes,” Cook said by phone. “And they’re from industries that usually pay better. So a lot of tech, a lot of finance, and self-employed borrowers are what we’re seeing.”
Part of the increase in homebuyers’ income is from local wages increasing too. The average hourly wage of private-sector employees in the Boise metro area increased from $23.55 in 2019 to $27.59 in 2021, according to the U.S. Bureau of Labor Statistics. That’s a leap from $48,984 per year to $57,387 for 40-hour-per-week workers — a 17.2% increase.
The median price of an Ada County home in 2019 was $345,000, according to the Intermountain Multiple Listing Service. In 2021, it was $510,987, a 48.1% increase.
“We’ve seen how it has affected our market. We’ve seen a lot of appreciation,” Cook said. “We had a lot of demand come in during COVID and just didn’t quite have the supply of homes that we needed for the demand that we had.”
This story was originally published August 9, 2022 at 4:00 AM.
