Finding apartments to rent right now is tough; buying or building homes is also challenging
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IDAHO FALLS —— Rexburg residents Alee Noland and her husband Nate never expected to be in the position they were in recently.
“We honestly thought we were going to be homeless. We thought we were going to have to move in with our parents and we have been independent and on our own for 10 years,” she said.
Alee explained to EastIdahoNews.com she was living in a townhome in Rexburg for the past four and a half years when she and her husband were forced to move out due to the owners wanting to sell. The unexpected change in circumstances led Alee scrambling to find a new place to live. But she said it was almost impossible to find a place due to a difficult housing market.
“I was literally checking every site six to 10 times a day. So Zillow, Zumper, Facebook Marketplace, Rentler, there’s several different ones. I went through all of them. Every couple of hours, I was checking them,” she said.
Alee told EastIdahoNews.com it even came to the point where she expanded their housing search from Rexburg, to Idaho Falls, all the way to Logan, Utah.
“There weren’t a lot of choices. Anything we tried to get, it would be gone within a day or there were just a lot of issues and reasons why we couldn’t get a place,” she explained.
The reality of it is true.
Eastern Idaho rental property managers have been experiencing a rapid increase in applicants. Those applicants are coming from several western states. Places like California, Washington, Oregon, and even people moving from Boise.
“(Rental properties) are going quickly. A lot of times when people call, they ask how many people have applied because they know things are going so fast. A lot of the homes that we manage seem to go the quickest because people really like to live in homes. The market is really crazy,” said Casey Cassity, a property manager with Blue Pine Property Management in Idaho Falls.
Cassity says they are constantly staying busy.
“When we put some properties up, they can be gone in a day or two. Sometimes, we’ll put them up and within 12 hours we have someone that’s applied, the process has went through and they are already approved,” he said.
According to a study done by Jake Durtschi, founder of Jacob Grant Property Management in Idaho Falls, the current landscape of the real estate market in Idaho Falls has shifted dramatically in the past three years. The city has witnessed a significant increase in demand for rental properties. As a result, multifamily property values have increased by 8% on average.
Jacob Grant Property Management manages a little under 800 residential units mostly in Idaho Falls, Pocatello and Rexburg.
“A lot of management companies here in town do waitlists. We don’t do that. We treat everyone equally across the board. It comes down to first come, first serve. So the very first person to put in an application, once it gets approved, they have 24 hours to bring in a deposit, once they bring in a deposit, it locks the property up until they sign the lease and then everything is official going forward,” said Kirk Rehfield, owner and relationship manager of Jacob Grant Property Management.
Rehfield says the prices have been almost astronomical with how much rent has gone up.
“Really, the rental market is in direct correlation with the housing market. In the last year or year and a half, I would say, your average place is jumping up from $150 to potentially $300-$400 in rent,” he explained.
For Alee, she was able to get a place to live. However, she never chose it or was able to look at it beforehand. She believes she was able to rent the place only because she started working at a rental management company that told her they had a unit available.
“We actually took a way smaller place. It’s about half the size of what we had before simply because (we took) whatever we could get. We are paying more in rent than what we had before. We went from a townhome to an apartment. We were paying $1,165 month-to-month for our townhome and now we are paying $1,325 for an apartment,” said Alee.
The waitlists aren’t just for already existing apartments either. New townhomes that are still being built also have extensive waitlists.
Austin Fitzgerald, the president and CEO of Angelo Development, and his brother Tyson Fitzgerald, are building Riverside Townhomes near Freeman Park to try and help meet demand.
So far, the development has only done a small amount of marketing. There is a sign outside the development describing the townhomes and who to contact, and there is a small amount of social media marketing. Despite that, the development has managed to get a significant waitlist for the 27 units.
The Fitzgeralds and their group say they are heavily invested in Idaho Falls and have some new developments in the works that they hope will bring value to the community and help fill the inventory gap.
The home buyers market
“The market is in an interesting time right now. You just don’t see (houses) sit very long,” said Jessica Cardon, director of Sales and Marketing for the Murdock Manwaring Company, part of Keller Williams Realty East Idaho.
Cardon explained in the month of July for homes in Jefferson, Bonneville, and Bingham counties, the average days on the market was 13.
“That was bananas. So that was really fast but the average year-to-date, we’re at 21 days,” she said.
Statistically, the number of real estate sales in Bonneville County hasn’t changed too much between last year and this year.
From January to July, the number of homes sold in 2020 was 1,202, and in 2021, there were 1,013 homes sold. But prices have gone way up. The average price shows a 35.8% increase. In 2020, the average price for a home was $266,773 and in 2021 it’s $362,511.
According to a press release from the National Association of Realtors, continued low levels of housing inventory, combined with record-low mortgage rates spurring housing demand, have caused an increase in median sales prices for existing single-family homes in all but one of 183 measured markets during part of 2021.
The median sales price of single-family existing homes rose nationally by 22.9% bringing it up to $357,900, an increase of $66,800 from one year ago.
Nationally, 12 metro areas reported price gains of over 30% from one year ago, including the Boise-Nampa region, which was 41%.
“A lot of people are worried about the idea that this is a bubble and they are going to wait until prices go down and they are going to rent until then. (But) it is the time to sell and buy, it really, really is. With everyone just feeling worried about it housing will always go up. It’s just not the time to jump into the water without a guide,” Cardon said.
The home builders market
It’s a difficult situation building homes too. Construction rates have experienced a progressive incline resulting in challenges for larger development opportunities. A recent survey identified that many current builders are waitlisted.
“I can speak to people looking for new construction and right now, everyone is booked out. If you are looking to do a custom build, you’re a year minimum before you get your house probably started on. The biggest struggle of course is the supply chain,” Cardon said.
EastIdahoNews.com attempted to contact several home builders in eastern Idaho with many of them unable to return calls and receptionists saying they are too busy to be interviewed.
Bryson Higley, owner of Fall Creek Homes, explained that his company builds about 65 homes a year and has already seen significant change within the housing market.
“We don’t think we will build any more homes that we’ve built in years past just because of subcontractors, labor shortages and material shortages. It just makes it harder to get a home built. There’s been a lot of demand for housing. We haven’t been able to pre-sell homes. That’s been different. We can’t control pricing on houses so we’ve been forced to go to a spec home builder, that way when I sell these houses, I’ll know what they cost to build. So we are not listing our homes until near to completion,” he said.
A spec home is a new, move-in-ready home built by home builders. These are houses that are built before a home buyer makes a purchase.
Higley says they have received multiple price increases for most components that go on a house like windows, trim, and concrete.
“Generally, you get one increase per year from a supplier and then you can budget for the year. We have been getting four or five increases from suppliers. It’s not just lumber that’s been going up, it’s everything in the house that’s raised drastically,” he said.
He explained there are shortages of materials nationwide and that he’s never seen pricing fluctuate like it has been.
“Even if I wanted to build more homes, there’s not enough subcontractor labor in this town for builders to build the demand that they’ve had in the last year,” said Higley.
As for Alee, she says in the end, she’s grateful that she was able to find a place to live among the hardships she’s experienced in the housing market.
“It’s hard, it’s crazy. Being married for as long as we have, we swore we would never go back to apartment living but we literally had no choice,” she said.