Know anyone who needs a house for under $250K in Boise? Here’s what little that buys now
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Affording Boise: Rental housing
Soaring rents. Skyrocketing home prices. The double-digit rates of increase in the costs of Boise-area housing create 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 rental homes, including apartments. A separate collection focuses on homeownership.
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Want to buy a home for $250,000 or less? It’ll be tough — if not nearly impossible — to find something.
On Monday afternoon, there were six homes in Boise for sale for $250,000 or fewer, according to the Intermountain Multiple Listing Service. All of them were manufactured homes.
Five of those were in the Rustic Acres manufactured-homes development in West Boise. Each had two or three bedrooms, between 720 and 1,512 square feet, on lots just big enough for the house and a patch of grass. They’re listed for prices between $70,000 and $165,000, and they don’t include the land under the houses, which the buyers must lease for $795 per month.
The sixth home is in the Aspen Creek Mobile Home Park near the northwest corner of West Ustick and North Maple Grove roads. It has three bedrooms, 1,344 square feet and is listed for $85,000. It, too, does not include the lot.
From April 18 to April 24, there were no existing homes in Ada County for sale for less than $250,000, according to the Boise Regional Realtors. Existing homes typically sell for less than newly constructed homes.
Just a few years ago, prices in this range were the norm. In March 2017, the median price of a home in Ada County was exactly $250,000. Five years later, in March 2022, the median was 130% more: $575,000. The inventory reflects the explosive growth in home prices: Just two homes in March were sold for less than $250,000.
The median price means half of the homes sold for more and half sold for less. So just five years ago, half of Ada County’s housing stock was worth a quarter of a million dollars or fewer. Now half of Ada County’s housing stock is worth more than half a million.
In 2017, there were 4,692 Ada County homes sold for fewer than $250,000. In 2021, there were 15.
“It is far more difficult for most first-time homebuyers right now,” said Jesse Taff, an agent with Boise Premier Real Estate, in a phone interview. “And to amplify that it’s even more difficult, or I would hate to say impossible, but at some point it is almost impossible, for a lot of local first-time homebuyers.”
That’s because local wages haven’t kept up with the increasing prices of housing. And when new buyers enter the market capable of paying more, the high demand and low supply drive prices up.
The median household income in Ada County is $69,952, according to the Census Bureau.
A Boise buyer with that income and good credit who can put $40,200 toward a down payment and closing costs, who has $400 in monthly debt payments and who still wants money left for food, entertainment and vacations, can afford a $274,705 home with a 30-year mortgage at a 5.4% loan rate with a monthly payment of $1,697, including taxes and insurance, according to Nerdwallet, a financial advice website.
(The $40,200 would cover $32,948 for the down payment, which is 12%, the median percentage down payment according to the National Association of Realtors, plus closing costs that Nerdwallet estimates around $7,252.)
First-time homebuyers face rising prices
Taff works frequently with first-time homebuyers. If prices are above their budget, he suggests saving up, improving your credit score and setting yourself up to eventually qualify for the highest price point possible.
Taff said people probably shouldn’t go beyond their means to buy a home. But he also said not to assume that you don’t qualify.
In response to the rapid rise in housing costs, Taff described buyers as getting creative. He mentioned people who would have preferred to be in Boise settling to live elsewhere like in Nampa, Caldwell or Emmett.
As Ada County prices have shot up, so have Canyon County prices. The median price of a Canyon County home in March was $452,915. Ten of 536 Canyon County homes sold for fewer than $250,000 in the month.
Source: Intermountain Multiple Listing Service
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Taff said some people have bought houses with friends and then rented out rooms to supplement their incomes. These types of arrangements have been more common in more expensive markets.
“It’s just new to us here, so it’s kind of a shock,” Taff said, “that we aren’t fortunate enough to be able to purchase (a home) as a first-time homebuyer, or as someone just out of college with a decent job, but maybe not high enough income to purchase the home they want. So it’s something this area’s adjusting to.”
Even as builders rush to build new houses and mortgage rates climb, Taff isn’t counting on anything different in the near future.
“We don’t expect any big changes up or down in the next year, probably two years,” Taff said.
This story was originally published April 27, 2022 at 4:00 AM.
