Ada County Home Prices Reach New High in February
The median sales price for Ada County reached $549,900 in February 2022, an increase of 21.6% compared to February 2021, and a new record for the county. Home prices continued to be driven by insufficient supply compared to buyer demand and indicate we will likely see another competitive spring market.
Two metrics that demonstrate the competitiveness of the market include Days on Market and Percent of Original List Price received.
After enjoying a more normalized market pace in January, Days on Market for existing homes sped up in February to 23 days, on average. This counts the number of days between when a home was listed and when the seller an accepted offer. While this is a year-over-year increase of 14 days, or 155.6%, it's a dramatic drop from January 2022 when the average was 33 days. Buyers may have a bit more time to shop, than they did last year, but will still likely need to make quick decisions once they find a home they'd like to purchase.
The Percent of Original List Price received for existing homes was at 99.6%, on average, in February. This means buyers paid slightly less than asking through a lower accepted offer or seller concessions. In contrast, buyers paid an average of 105.5% of the list price last year. Buyers may be unable or unwilling to spend over list prices to win a listing, as was common a year ago, or we're seeing sellers pricing homes more in line with the market comparables.
Overall, we are seeing fewer bidding wars than last year, but that doesn't mean it isn't still happening in some instances. It just depends on the particular property, the list price, and what buyers are willing to pay.
At first glance, it may seem odd that home prices have gone up so significantly when, on average, buyers are paying close to asking price. However, as mentioned, each home sale becomes a comparable for future home sales of properties in the same location and with similar amenities, which is taken into consideration when pricing a new listing. So as homes appreciate, sellers are asking, and receiving, more for their homes than they have in the past.
But the list price is just a starting point — as indicated by the Percent of Original List Price received metric — sometimes buyers pay more, and sometimes they pay less. Ultimately, a home sells for what the market determines it's worth.
It may be tempting to price your home lower than what the comparable data indicates it may be worth, in order to drive up the price with multiple offers. But it's important to remember that pricing low doesn't guarantee a bidding war. Pricing higher than what comparable sales support may exclude your property from the search criteria of possible buyers. Using market data, your REALTOR® will provide you with a pricing range and help you form a strategy to get your home in front of the maximum number of buyers so you can receive maximum value.
Another contributing factor that drove up the overall median sales price in February was the larger share of new construction home sales for the month. Due to increasing costs and shortages of materials, as well as increasing costs of land and labor, the median sales price for new homes was 30.6% higher than the same month a year ago, coming in at $587,551. In February, new construction homes made up 36.7% of all home sales, which also pushed up the overall median sales price for the county.
Other notable statistics from February 2022:
- There were 493 homes available at the end of the month — 62.7% more than in February 2021 — although still very low compared to buyer demand.
- Of the 660 sales in the county, 418 were existing homes, an increase of 21.9% compared to the year prior. Overall sales (existing and new combined) were up 7.1% compared to January 2021.