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Real Estate Investor Blog
Boise area real estate and rental management blog
A Candid Conversation - How's the market?

The market has been variable. I have a sense that we're going to see a correction. I don't think it will crash. I wouldn't mind if it simply flattened out. How many years in a row can double digit appreciation be sustained?

 

People seem to be sensing a market shift, which has started stimulating more seller phone calls than buyer calls right now.

 

Increasing Interest Rates - The drastic, and unpredictable changes in interest rates should affect the market, at least temporarily. And they will affect payments, cash flow and buying power.

 

Should you buy now? Nobody knows the future. If the right property comes along that makes sense today, and you're in the market, and you can afford it, I would not be inclined to wait because we don't know what is going to happen. With interest rates climbing, it's possible your PITI payment would go up, even if the purchase price went down. (PITI: Principal, Interest, Taxes, Insurance)

 

If I was a buyer right now, and the right property came along, I would buy. In fact I am a buyer right now.  Stacy and I just closed on a property last month and I have 3 more that that close this fall.

 

On Selling - I look at the performance for investment properties. If I have doubled or tripled my money, I consider that good performance. It's hard to complain about that. Sure I'd have to figure out what to do with my money. I don't mind sitting on cashed out funds should the market change, so it's available to reinvest if the market drops. Both Stacy and I sold properties last year because they doubled and tripled our money.

 

You have to look at your own situation. It has been a Sellers market for a while. That's a good time to look at what would be harder to sell in a down market, and to cash out the equity you've earned. So if you have had a challenging property, I’d probably cash out. So far, it's still the market to sell any more challenging properties...maybe. That could change.

 

Market changes often take some time to happen and then more time to change again. If you have a property you might consider selling in the next couple years, this could be the time to do it. You have to look at your whole strategy.

 

What NOT to do - We can learn a lot from how to lose money: buy today, then give up and sell if values tank.  Our advice- always structure a deal, with the right down payment, so that you can wait out any downturns in the market. If it's a rental property, you ideally will be cash flowing as you wait.

 

Change is eminent - no market lasts forever, and we've had quite a long run of a Seller's market. Values, rents and vacancy go up and down, and are influenced by the laws of supply and demand.

 

Instead of promoting buying or selling, I like to ask my clients about their economic outlook and their real estate goals, and try to present ideas that support that.

 

What would we do? (What do we do)
-Consider your overall plan, needs and goals
-Buy if it's a good property that you want or need, and if you can afford it -Structure your down payment so that you can afford to hold your purchase -Hold onto it in markets that favor Buyers
-Buy investment properties if the current market softens
-Sell in markets that favor Sellers or in balanced markets

 

Your Boise Investment Properties Team with Swope Investment Properties

Stacy McBain, Associate Broker

Tony A Drost, Associate Broker

Leslie Halvorson, Realtor

 

 

Boise Assessed Property Values Continue to Rise

The 2022 property tax assessments will be headed out to all Ada County (Boise, Meridian, Kuna, Eagle, and Star) real estate owners soon and as real estaate values have continued to increase and so will your assessments.

 

For investment properties we expect to see an increase in assess value by about 30%. The assessors have seen an approximately 20% increase in rents and cap rates right around 5%. Remember this is always calculated as of January 1st, because we have seen those cap rates continue to be compressed since then.

 

Single family homes will see increases in the 30-35% range and this is for all areas of town. Of course there are always going to be outliers in there, so yours may be a little higher or lower than these numbers. The biggest increases are going to be in bare land, which will see increases in the 40-60% range.

 

If you feel your assessment is too high, please feel free to call your friendly Swope agent and we can help you take a look and make a decisions if you should appeal or not.

 

As always, if you are going to appeal your assessment it is best to get it in sooner than later. Do not wait! Your assessors name and phone number are on the bottom of the statement and you can contact them directly, or ask us and we would be happy help you. You can do an informal appeal prior to the 27th of June, but again, getting it in early gives you a better chance of avoiding a formal appeal. If you wait until just before the 27th you must do a formal appeal and go before the board to present your information. Please feel free to contact an agent here at Swope and we would be happy to assist you in any way we can!

 

Shane Brown, Realtor

Swope Investment Properties

Preparing for 3rd Party Professional Property Inspections

We have worked with Boise's AAD Inspection for almost 30 years now.  They do a great job with their inspections, regardless if the property is a single family or multi-family, such as apartments or a fourplex.  AAD also devotes a lot of time educating buyers, sellers, and their agents.  Recently AAD released an article about how a seller can prepare for a property inspection, which we have posted (with minor changes).

 

PREPARING FOR A HOME INSPECTION

 

The following suggestions can help facilitate the process of having your home professionally inspected – making it easier for all involved, including the occupants.


Attendance:


Please vacate the property during the inspection, if at all possible. This gives the inspector and buyers (together with their Realtor) a chance to speak freely without anyone else listening in on their conversations.


If it’s not reasonably possible to leave the property during the inspection, please avoid interacting with the property inspector as much as possible, unless the inspector has questions. (Please understand and accept that the people actually paying for the inspection and report would usually prefer to receive
the information and have time to digest it before other parties receive the same information.)


Please either remove pets from the property, or secure them within kennels.


Providing Access:


The following places or components should be made accessible without needing to use keys or needing to move personal property:


All attic accesses


     All crawlspace accesses


     All electrical panels and/or fuse boxes

 

     All shops, garages, additional living spaces, and outbuildings.

 


What to Expect:

 

     The inspector should be the ONLY person touching and/or operating components and systems on and in the property.

 

     No personal property will be touched (unless to gain access to items or places that need to be inspected.

 

     Any and all other people (such as buyers and/or their Realtors) will be asked to refrain from touching or operating any part of the property.

 

     The inspector will likely lift and/or temporarily move all loose rugs to inspect under them.

 

     The inspector will operate the heating and cooling systems, removing panel covers and air filters for inspection.

 

     The inspector will run both hot and cold water through all plumbing fixtures just long enough to verify that they are correctly connected. Subsequently, only a minimal flow of cold water will be run through every sink or vanity fixture and a full flow through only showerheads for up to a couple hours (but only while the inspector remains inside the dwelling to watch for possible leaks or overflows).


     The inspector will operate all light fixtures and switches.


     The inspector will operate all windows and window coverings.


     The inspector will operate all major kitchen appliances and exhaust fans that are physically attached to the property.


     The inspector may operate the sprinkler system (if that service is contracted by the sellers).


     The inspector will walk upon all roof surfaces if safe to do so without fear of personal injury or damage to the roofing materials.

 

     The inspector will enter and crawl through all physically accessible attics over living spaces and crawl spaces under the dwelling.


Additional Thoughts:


     The inspector is not at liberty to discuss any findings with the sellers, occupants, or their representatives. However, if any discoveries or issues needing immediate attention for the safety of the occupants or the continued integrity of the property are found, the occupants and/or the listing agent will be made immediately aware of them.


     If any particular item or system in or on the property is not working, should not be operated, or needs special care, please inform the inspector through notes left on the premises, or by other means.


     The sellers might not ever see the entire report. However, if any inspection issues are brought to the negotiating table, the seller has the right to receive exact copies of at least those portions of the inspection report that address those issues. (This part of the Purchase and Sale Agreement contract protects the sellers from inaccurate conveyance of inspection information.)

Where's The Boise Area Market Going?

As we've entered into another year of unprecedented times in the real estate market, the answer everyone wants to know is what to expect with the market in the Boise area. Although none of us have a crystal ball, we do have experts, data and knowledge to forecast an educated picture for the near future of the real estate market.

 

After seeing the market on fire the first half of 2021, around mid June we started to see a bit of leveling. Buyers were fatigued from missing out on homes due to having to compete with cash offers well over list and the amount of inventory started to creep up. As we entered into fall and early winter, we were seeing a tad longer days on market as well as some price reductions. Well, come the holidays and just after the new year, the market started to ramp back up again. For buyers looking at the median price range around $450,000, homes were flying off the shelves. So what do we anticipate?

 

According to the chief economist for National Association of Realtors, our core inflation is up to 4% which is affecting buyers in the starting to mid-level price range. High end homes are not expected to see much of a slow down because buyers in that bracket are still going to be buying as a way to hedge their money against inflation. Along with the rise in inflation also comes the increase in mortgage rates. It is estimated rates will increase approximately .7% by the end of the year, with the biggest jumps coming in third and fourth quarter. Although this greatly affects buying power as it impacts one's payment (and most buyers live in the payment and that is how they budget for a home) the rates are still historically low compared to where they've been in the past. As this too will have the greatest impact on entry level buyers, it's anticipated we will start to see a bit of a tapering of pricing and keep them from increasing at the rate they have been. This could also have an affect on the move up market as those who are wanting to sell their starter home and transition to something larger, more expensive, etc, they may have a harder time finding a buyer.

 

Please keep in mind that rates will differ from buyer to buyer depending on many different factors. If you would like a great lender to chat with, please reach out to your trusted Swope Investment Properties' agent and we'll get you connected. The information provided here is an overview of the market and each specific area has its own market factors like growth, job availability, home building rates and so on. For more specifics on your area, again please reach out to your trusted Swope agent. We're here to help anytime!

 

Paige Brown, Associate Broker

Swope Investment Properties

Leslie Halvorson, a Boise Idaho native, joins Boise Investment Properties!
Leslie Halvorson, a Boise Idaho native, joins Boise Investment Properties!
BIP Welcomes Leslie Halvorson!

Boise Investment Properties (BIP) has become an official team within the Swope Brokerage, and this team has exciting news to share. Associate Brokers Tony Drost and Stacy McBain announce Leslie Halvorson as the newest addition to BIP and Swope Investment Properties. Leslie will serve as transaction coordinator and licensed assistant. 

 

With her background in customer service, real estate and property management Leslie will amplify the level of responsiveness, expertise and service our clients receive. Leslie is reliable, trustworthy and most importantly, an absolute gem to work with. She is, afterall, from the Gem State. Please join us in welcoming Leslie!

 

Leslie's full bio may be found on the BIP web site or our facebook page www.facebook.com/boiseproperties

 

The best way to meet Leslie, will be to have us help you with your purchase and sale needs! We will value your feedback. 

 

Leslie, welcome to the team! 

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SWOPE INVESTMENT PROPERTIES

1161 W River St., Suite 160 Boise, Idaho 83702
PH: 208 794-6424 | Fax: 208-385-7240