Originally posted by @Salvatore Lentini:
@John Townsend - yes, I've heard about the boom in Boise. Do you think it's sustainable and/or justified? If you do, can you find deals on the fringes? Which direction is development heading? Sit in on or read the planning commission hearings in your city/town. Find out where new developments, new commercial areas, new parks, running and biking trails, corporations etc are going and start buying near there. Sometimes you need buy in the spots that may not look the best now (so you get a deal) but you know in the next 5 years will be worth more and become more desirable. I bought 2 properties on a block in 2017 that at the time was in a neighborhood with mixed residential and industrial/old warehouses. I knew about plans (going through borough approval) to knock down a bunch of warehouses and turn it into a luxury townhouse subdivision. When I first bought the properties they seemed like pretty boring, average deals. Now, 2021... 1/2 the townhouses are done and sold and the other half are framed out. The block looks A LOT different now and the value of my properties have doubled just because they are next door. So see if you can look on the fringes of Boise or next towns over.
You make a great point about the rental increases and prices being justified. In full disclosure, I'm a newbie and not an expert, but I grew up in the Boise area and remember it being so 'small' in population that if you wanted to go to Taco Bell you had to drive 45 minutes to an hour away to Ontario, Oregon because there were literally NO Taco Bells here (except 1 in Boise which was the same distance away from where I lived) until the mid-nineties when I was in high school, and so I've seen how this place has grown and changed. From my perspective, I don't see the rent increases and rapid appreciation being sustainable long-term. Now, someone who's well-experienced in property management may contradict me, and they would be the experts, but from what I see, Idaho is a VERY low-wage state, one of the lowest in the country; the State Legislature refuses to EVER consider an increase in the minimum wage and we are still largely across Ada, Canyon and Owyhee Counties dominated by service industry and agriculture jobs. Much of the wage growth here is not organic growth, but people moving in who work for out-of-state companies working remotely bringing their incomes with them. The 'locals' who have grown up like me or lived here all their lives are struggling very badly to find affordable housing. There have been several people I know that are moving or have moved out of state because they can't afford to live here anymore-something to most people 5 years ago was unthinkable. The rapid appreciation seems to be a perfect storm of extreme lack of housing and a massive inflow of out-of-state (dominantly California) money. Now, the primary home side of things in many ways is a different beast than the investment side, but they do correlate in some aspects. A couple anologies I can offer, is I have a buddy who's kid is going to be going to Boise State in the Fall, and due to lack of affordable housing in the Boise area is going to live at home and commute into Boise from Homedale...a town an hour from Boise one-way, nearly an hour-and-a-half with traffic. Just on the news last week was a piece about how many sellers here are not accepting FHA or VA offers, PERIOD. Due to so many people coming in waiving all contingencies, paying cash and $30k-$50k over asking they see it as a waste of time (local agents can give you a much more accurate picture of trends than I can; I just know what I see). I had a good conversation with a gentleman at the Boise VA hospital the other day who invests in Boise, Caldwell and Nampa and who recently sold some properties, tell me if a buyer is not waiving all contingencies and paying all cash, he won't even have the conversation with them because he has no need to; as he put it, there's way too many people here willing to overpay in cash and anything else is a waste of his time. In my uneducated opinion, I think there's such a massive in-flow of out-of-state people that appreciation will still rise and rents will rise due to house hunters needing a temporary place to stay while they find their permanent residence for awhile; how long, I have no idea. But, when the day comes that the tap of out-of-state-money turns off, it could be bad. Not trying to be bleak, but I see on the forums so many people asking about Boise, and there's a whole underlayer that people don't see when you just look at the statistics.
