Real estate experts share insights on homeownership trends

From soaring mortgage interest rates to inventory and stock, shifts in population growth, and even the length of time a property remains on the market, these and other key factors can and do change rapidly for real estate agents.

Since 1977, agent Ron Minegar has sold homes in southern Idaho. At the Keller Williams firm, his daughter, Alissa Gamble, has generated two decades of real estate experience. For Idaho Property People CEO Chad Hansen,15 of his 23 years as a realtor have been spent guiding buyers and sellers throughout Ada and Canyon counties.

Collectively, the trio has amassed eight-plus decades of industry experience in the Treasure Valley. With today’s local median home price floating near half a million dollars, the veteran agents recently shared their unique industry perspectives with Idaho Business Review.

This interview has been edited for length.

Idaho Business Review: A local billboard once expressed, “Because homeownership is for everyone.” How fair or accurate a statement is this?

Ron Minegar: It’s been said, “beauty is in the eye of the beholder.” While there are tremendous benefits to home ownership, some people see real estate as not worth the risk. It’s different for everybody. For instance, a highly mobile employee who spends 48 weeks a year on the road, owning a home that they must maintain may not be ideal.

Chad Hansen: Yes and yes. But I might provide a different perspective because I also work with agencies that offer affordable housing. I strongly believe everyone should have access to homeownership, but no, I don’t think it’s for everyone. The traditional way we have been brought up has changed. There is a difference in this younger generation. COVID changed things dramatically with many people discovering they could work from almost anywhere. But I think everyone should own a home. It’s the most traditional way of building wealth as an individual.

Alissa Gamble: Personally, I don’t believe all absolutes typically work. Real estate is a vehicle to drive wealth. Money is about what it can do for you. It’s the No. 1 way to create millionaires. It can be a vehicle, depending on one’s goals, so it may not work for everybody. But it is truly an effective method to keep up with inflation and grow wealth.

IBR: Median home prices fluctuate constantly. How do you decipher the actual median home price when a new figure is seemingly released weekly?

RM: There’s a saying, “figures lie and liars figure.” In our business, it’s about the factual data you can pull from various pools. It reminds me of the interaction between a client and a CPA that he’s interviewing. The client says, “Hey, Mr. CPA, what’s two plus two?” The CPA gets up, closes the door and comes back in and says, “What does the client want it to be?” For me, the value that I think is solid in any industry is the interpretation of the data as it relates to the client’s goals. I know that sounds nebulous or vague, but most anyone can pull numbers to justify any story one wants to tell.

CH: I rely on data and numbers from the Boise Regional Realtors. They track monthly the stats for both Ada and Canyon Counties. This includes median prices, homes sold, pending sales, inventory and the number of days a home is on the market. Ultimately, it’s our job to answer questions and to educate prospective buyers and sellers.

AG: I see myself as a real estate consultant, meaning that I must ask lots of questions and then share data to help a client make the best decision. When I meet with a client, it’s all about what they are looking to determine. Are they buying, selling or both? And the market is never the same. It is constantly swinging like a pendulum. It’s all about somebody who can bring that data together and share it by asking questions.

IBR: In 2020, the average U.S. homeowner reportedly paid about 25% of their per-capita income towards mortgage interest rates. A 2024 report indicated that figure is now closer to 60%. What do you consider a comfortable or more accurate figure?

RM: I say 35%, and if somebody comes to me and they’re trying to lean themselves out, well, I don’t know if they’re going to qualify for financing. Especially when their total debt to income ratio is 50%. But I definitely believe 35% is probably the upper marker.

CH: That’s a pretty high number which indicates someone is “house broke,” meaning not enough money left over for food, kids, car payments or other necessities. Historically, and reasonably, that number should be about 30%. Even 25% is more reasonable. But it’s not doable. Home costs have increased significantly during the past 10 years, but incomes have not followed. What used to be 30% to 40% as a good number might now be 50% in some markets. That is not healthy or sustainable. Nor do I think it’s right. A homeowner should be able to afford the necessities, but I’m not saying they should live outside their means. I’m talking food on the table, diapers, a reliable vehicle, things that should not be sacrificed for having a roof over your head.

AG: Nationally 34% is what it takes to buy a mortgage with the affordability and the average income. Today you need average or really above average income to qualify. In Venezuela, they don’t even have loans. You have to pay cash. In Canada, you need 20% down. So, of all the countries worldwide, the U.S. provides the best opportunity to own because we have so many options. It’s about the long-term. I would never advise somebody to buy a home who might sell it in two years. Real estate is a long-term investment you want to make intentionally and with capability.

IBR: What is the impact of the “locked-in effect,” meaning empty-nesters with larger properties, small mortgages and dirt-low interest rates who are not selling?

RM: Whether downsizing or upsizing, every move is a quality-of-life decision. It’s deciding that the quality of life will be better somewhere else. And you even have to include people who overspend or fall behind on their payments. But I see a lot of people in my demographic, Boomers, who move for family reasons. It could be grandkids, dependent parents, lots of reasons. And occasionally, someone sees something shinier and better across town. Often times, a lot of people are pretty happy where they are and decide to stay put.

CH: This locked-in trend significantly impacts the market. Often it’s those with no kids, lots of equity and historically one of the lowest interest rates we’ll ever see in our lifetime. These people are equity rich, but it doesn’t pencil to sell because the equity you can pull out will not allow you to buy something comparable without paying more due to current mortgage interest rates. Moving doesn’t make sense. The same applies to families with four kids or one kid. It’s definitely slowing the market on existing homes.

AG: I just returned from a national conference and one statistic that jumped out showed 50% of homes owned have 60% more equity. And 30% are owned free and clear. So, we are seeing a lot of cash or having a very small loan, along with this shift in the equity increases we’ve seen over the last few years.

IBR: In this industry, how crucial is the concept of financial literacy, particularly in today’s economy?

RM: If you have no financial chops or literacy and you find yourself in a home, you could quickly find yourself overwhelmed. I have many examples of that, some in our own family, where homeownership may have come before the full responsibility part was locked in. We need to do more to educate people. I can recall one buyer who after five months decided monthly payments were optional. The buyer never really fully understood the responsibility.

CH: Purchasing a home is a daunting task. But after buying, maintaining a home is an entirely different set of responsibilities that I don’t think this younger generation takes into account. Financial literacy, I am finding, is just not there. Those required to obtain a loan through Idaho Housing or an FHA loan are required to take education courses for first-time buyers. It’s a monumental task and many young people don’t realize how important it is to have solid credit, file tax returns, maintain good financial records. This is what helps get you approved for a loan. Working with first-time buyers is one of our biggest challenges.

AG: I think we could do more in our schools to help teach financial literacy. You have to plan for maintenance and those can be large cost items if you’re unprepared. We know of people who have used homeownership as a continuation of their bad spending habits. They use their equity as a bank account, pulling it out, taking on refinances or a HELOC. Sadly, they continue these poor habits and then they find they’re stuck.