Numbers might be the lowest in a decade, but the slump may be ending.
Ada County home sales for August will likely be the fewest for that month in almost a decade, according to a local real estate broker.
Using numbers compiled by the Intermountain Multiple Listing Service, Re/Max Capital City Associate Broker Shaun Tracy is forecasting 528 Ada County home sales by month’s end, the fewest since 527 transactions were recorded in August 1998.
However, Tracy is predicting 600 sales in September, which would be closer to the 648 homes sold in July.
Based on that, he believes that the reeling housing sector has finally reached bottom and may be poised for a rebound once an excessive inventory of homes has been absorbed by the market.
“We’re settling into a spot that — at least for the moment — we’re going to stay in,” Tracy said.
According to the Intermountain Multiple Listing Service Web site, there were 5,198 Ada County homes waiting for buyers at the beginning of August.
Tracy said the fact that only 48 residential building permits were issued in Meridian last month indicates that builders are not eager to add to the inventory hanging over the market.
In the meantime, the sluggish housing market is weeding out people who suddenly became home builders and began building high-priced “spec homes” when Idaho was one of the hottest real estate markets in the country, said John Cotner, owner of Cotner Construction.
Those high-priced homes are not finding many buyers as consumers are concentrating on homes in the $200,000 to $250,000 range. The result, he said, is that people who were not real builders are being forced out of the business.
“A lot of bad apples are being shaken out,” he said.
In some cases, Cotner said, builders who sold spec homes to investors now find themselves competing for buyers against those same investors.
For a custom home builder, however, he said it’s actually a good time to be building pre-sold homes because the downturn in the building market has caused a drop in the cost of materials.
Ted Martinez, president of Tradewinds Building Co. in Boise, said recent media reports of a “credit crunch” and stories about subprime mortgage companies going out of business are spooking some potential homebuyers.
“People read about gloom and doom and they assume it’s true,” Martinez said. “But this (downturn) doesn’t hold a candle to the late ’70s when you couldn’t give a house away.”