No one can deny that the past few years have been some of the most tumultuous in the real estate market. Commercial real estate has undergone its own ups and downs, though all indications point to a strong rebound of multifamily home price, as well as office property price.
Multifamily Homes
As rentals and smaller homes become increasingly desirable, the demand for multifamily homes remains strong all across Idaho. Statewide, the median asking price of a multifamily home was up 17.8% YoY in September 2013, and up 4.0% since July 2013, a month that traditionally shows stronger demand than in the fall. Boise has even better news. September 2013 showed a 40.5% increase in median asking price YoY, and a 10.4% increase since July. This price increase is likely do to the increased desirability of multifamily homes.
Office Properties
Though there have been improvements in the asking price of office properties, the rebound seems significantly less strong. Statewide, the asking price increased only 11.1% YoY. Boise improved even less, with a median asking price increase of 9.0% YoY and 5.7% since July. Even though this increase is lower than multifamily homes, it still represents a significant improvement. Unemployment in Idaho is slowly decreasing, and as it continues to fall, demand for office properties may rise. This slow increase in sale price is reflected in the increasing asking price of office property rents. Statewide, rents have risen 3.6% YoY, while in Boise, the increase has been 5.0% YoY.
Industrial Properties
The field that has shown the lowest improvement statewide is the industrial field. After reaching a peak of over $90 per square foot in 2007, industrial property value steadily fell to a low of around $55 per square foot in 2012. Today, the improvement exists, but is slow. In September, the statewide value of industrial property was an average of $61.24 per square foot, an increase of 6.1% YoY. With such a comparatively slow improvement, it is no wonder that the asking rents of industrial properties have practically remained the same over the past year. Statewide, the rents have increased 2% YoY, while the county of Boise has seen to change since September of last year.
Retail Property
Conversely, retail property has shown strong gains over the past year. At $118.35 per square foot, the Boise metro area has improved 24.3% YoY and 7.8% since July. Despite this large jump in sale price, the asking price of renting retail property has risen only a moderate amount. Statewide, the median rental price has risen 5.5% YoY, while Boise raised its price 4.2%.
In all industries, commercial real estate has risen in value in Idaho, though the extent of that increase depends on the specific type of commercial property. Improving employment prospects and a growing economy indicates these trends are likely to continue.
(Statistic Sources: Loopnet; Idaho Department of Labor)
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