A seller’s market is when demand for homes is higher than the supply, which is happening now as sellers get more for their homes as homebuyers compete with each other to snag the few homes available. But it also means people are staying put longer, as there are fewer opportunities to move.

“A balanced market, or one not favoring buyers or sellers, is considered to be four to six months of supply,” Stiffler said. “We likely won’t see much impact on prices until then.”

The new-house inventory is rising too. Ada County had 554 available homes in May, up by 166 units or 43% over May 2023, Pennington said. Canyon County had 373, up by 168 units or 82%.

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Still, that’s just 2½ months of supply or less.

Home prices flatline, reach new high

But even with the increase in supply, don’t expect a drop-off in the stratospherically high price of homes.

The median sales price in Ada County was about $552,000, which was up nearly $18,000 from May 2023, according to the Intermountain Multiple Listing Service. In Canyon County, the median sales price in May was about $420,000, up about $5,000.

These are massive increases from a decade ago. The median price of a home in Ada County in 2013 cost about $198,000, while the average price in Canyon County was $125,000, according to data from the Intermountain Multiple Listing Service.

The numbers are even more dramatic when looking at the average home price rather than median. The median is the middle value if you line up all the sales, while the average is calculated by adding up all the sales prices and dividing that number by the number of total sales.

The average sales price in Ada County so far this year hit a new record of nearly $640,000 — up nearly $9,000 compared to the 2023 average sales price, according to the Intermountain Multiple Listing Service. In Canyon County, the average sales price so far this year is about about $468,000, which is up about $7,000 over the 2023 average.

For newly built homes, the average Ada County sales price so far this year is nearly $643,500, decrease of nearly $10,000 from the 2023 average, according to the listing service. In Canyon County, the average sales price so far this year is about $474,000, about $2,300 over the 2023 average.

Home sales tick up in May

Home sales are also increasing, with Ada County seeing a 14.7% increase in sales compared with May 2023 and Canyon County seeing a 5.4% increase, according to The Agency.

Part of the increase in sales could be from homebuyers who are frustrated with waiting for prices and interest rates to come down and buying regardless, Hughes said.

“What you find in the market right now that’s really fascinating … is that some folks, regardless of rates, are moving anyways,” Hughes said by phone.

But home sales are still down compared with past years as homeowners face pressures to stay in their homes rather than sell.

It’s common that homeowners often sell their homes and use that money to move up to bigger, better or nicer homes. But that’s not happening as much now, Hughes said.

Homeowners who bought their houses in 2020 or 2021 when mortgage rates were closer to 3% don’t want to lose those low rates and can’t afford to move up and purchase more expensive houses with rates now around 7% since their monthly payments could go up much higher, Hughes said.

“You have a segment of people that feel trapped by a very good mortgage,” Hughes said.

Since people aren’t moving up or selling homes as much, homeowners are getting squeezed on both sides.

“They’re super stuck,” Hughes said. “There’s no good options.”

Most of the people selling homes right now are those that have to because of large life impacts, such as death, inheritance or health reasons, he said.

Price cuts for homes in Ada, Canyon counties?

One important metric that could often be overlooked is how much homes sold for above or below the original listing price.

According to Zimmerman, this has shifted more to the benefit of buyers.

“Through either negotiations on price or concessions or through price reductions, buyers were able to secure homes in Ada County for an average of 98.5% of the original list price, down from 99.1% in April,” Zimmerman said. “In Canyon County, the average percent of original list price received for homes sold in May was 98.1%.”

Zimmerman said 48.8% of Ada County homes sold had a price drop before they sold, while 53.9% of Canyon County homes saw a drop.

When the COVID-19 pandemic hit and remote work became a norm for wealthier white-collar workers, thousands of people moved to the Treasure Valley and bought homes.

As the demand for homes increased, sellers were able to take advantage of the increased competition and sell their homes for above the listing price.

It peaked in March 2021, when sellers were able to sell their homes in Ada County for an average of 104.1% over the original listing price and 103.8% in Canyon County.

The reverse happened in the winter of 2022-23. Sellers sold their homes for an average of 91.4% of the original listing price in Ada County in December 2022 and 90.3% in Canyon County in January 2023.

Interest rates stay high

The Federal Reserve held interest rates steady Wednesday and indicated that it would cut interest rates one time this year — rather than the expected three times the Fed had predicted in March.

Higher interest rates can affect everything from credit cards to student loans, home mortgages to car payments and lead people to shuck out more money to cover costs. But they also lower demand for goods and services and help tamp down inflation, which is part of the Fed’s aim to keep employment high and prices stable.

Fed rates strongly influence mortgage rates, which skyrocketed from about 3.2% for a 30-year mortgage in January 2022 to 7.8% in October 2023, according to Freddie Mac.

Mortgage rates are still at about 7%.

“Ultimately, the best thing we can do for the housing market is to bring inflation down,” said Jerome Powell, the Federal Reserve chair, during a press conference Wednesday.

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