Boise is most overvalued housing market in U.S. for second straight year

BOISE — The Boise housing market is overvalued by more than 72%, a recent study from a pair of Florida universities shows. Of the biggest 100 U.S. metro housing markets considered overvalued, Boise ranked first in the nation at 72.64%.

Researchers from Florida Atlantic University and Florida International University determined what markets were overvalued by analyzing the percentage difference between the expected price of a home and what buyers are paying. A statistical model determined the expected prices, and the actual prices paid came from the Zillow Home Value index.

If buyers paid more than expected, then that home was classified as overvalued. The researchers then ranked the most overvalued housing markets of America’s 100 largest metros by determining the premiums buyers have been paying. The larger the premium, the more overpriced the market.

The researchers’ data dates back to 1996 and covers single-family homes, townhomes, condominiums and co-ops.

Boise has now ranked first in the study for the second-straight year after taking the top spot in 2021 when the city’s housing market was overvalued by 80.7%.

FAU economist Ken Johnson described Boise as the “most modern example of a boom town” following last year’s report. Since then, Boise has seen its first neighborhood have an average sale price of over a million dollars when the median home-sale price in Boise’s North End hit $1,034,999 in April, according to previous Idaho Statesman reporting.

Johnson noted in a press release announcing the 2022 report that rising interest rates could help fuel a slowdown after skyrocketing home prices over the last couple of years.

“If we’re not at the peak of the current housing cycle, we’re awfully close,” Johnson said. “Recent buyers in many of these cities may have to endure stagnant or falling home values while the market settles — and that’s not what they want to hear if they had planned to resell anytime soon.”

Boise City, ID

Austin, TX

Ogden, UT

Las Vegas, NV

Atlanta, GA

TNS