The real estate market has been strong, and demand remains high. Both in the Boise market and in Tri-Cities, Washington we are seeing extremely low inventory levels of single-family homes. Boise, for example, has less than two months of supply of houses for sale. Tri-Cities has fewer than 500 active listings, including both new construction and resale homes. The lack of available resale homes, combined with the rising prices of resales, are driving more buyers to new construction.
A recent article explains three reasons why real estate investment will remain attractive for the foreseeable future. While the article focuses primarily on REIT investments relative to stocks, it also supports the argument of purchasing a home as an investment. We particularly agree that interest rates will remain low in the near term and that buyers can enjoy the benefits of positive leverage resulting from low borrowing rates combined with the prospects of value appreciation in the future.