Why is Real Estate in Idaho so expensive?

Idaho’s real estate market has skyrocketed, pricing out many residents. A mix of intense demand, constrained supply, and unique geographic and economic factors explains why.

Surge in Migration: Idaho’s appeal—stunning landscapes, low taxes, and a laid-back vibe—has drawn waves of newcomers, especially from pricey states like California and Washington. Post-pandemic remote work fueled this, with Boise’s population growing 2.4% annually since 2020. Median home prices in Boise jumped from $276,676 in 2017 to $525,000 in 2025, driven by cash-rich buyers outbidding locals.

Chronic Housing Shortage: Idaho’s housing inventory is critically low, at just 2.8 months of supply in 2025, compared to a balanced 6-month benchmark. New construction lags, with only 4,500 permits issued statewide in 2024 against demand for 10,000 homes. Bidding wars are common, inflating prices further.

Geographic Limits: Over 60% of Idaho’s land is federally owned, restricting development. In Boise, surrounded by foothills, buildable land is scarce, pushing prices up as developers compete for lots. Rural areas face similar constraints, with zoning laws slowing growth.

Economic Boom: Idaho’s economy is thriving, with tech giants like Micron and a booming tourism sector creating jobs. In 2025, job postings for skilled roles surged 22%, with median salaries up 33%. This attracts young professionals, intensifying housing demand.

High Interest Rates: Mortgage rates, around 6.5% in 2025, inflate monthly costs, yet demand persists, keeping prices high. Investors, paying cash, further drive up competition.

Idaho’s soaring real estate prices stem from relentless demand, scarce supply, land constraints, and a robust economy, creating a challenging market for buyers.