8 Steps to Buying a House in Idaho

Clever Real Estate

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Clever Real Estate

October 1st, 2022
Updated October 1st, 2022

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8 Steps to Buying a House in Idaho

Save for down payment | Find a real estate agent | Get preapproved for a mortgage | Choose your neighborhood | Go house hunting | Make an offer | Inspections and appraisal | Final walkthrough and closing

Buying a house in Idaho is an exciting milestone, but the process can take some time. Several factors, like your financial situation, market conditions, and the local economy can affect both how long it takes you to find a home and how much it costs you.

For example, homes in Boise City are hitting the market at $549,900 and selling within 56 days — 22 days faster than the state average! — so you'll need to move quickly if you want to beat out the competition.

The more you know about the home buying process and Idaho's current real estate trends, the more prepared you'll be to navigate this complicated process as quickly and smoothly as possible.

No matter where you are in your home buying journey, Clever can connect you with local real estate pros who will help you purchase your Idaho dream home!

The best part? When you buy with a Clever real estate agent, you could earn a cash-back refund worth up to 0.5% of the home price. On a qualifying $300,000 purchase, you'd get $1,500. That's real money back in your pocket!

» START: Buy with a top local agent, save thousands with Clever Cash Back

Step 1: Save for a down payment

🔑 Key takeaway:

Your down payment can be less than 20% of the purchase price — $93,577 for the typical home in Idaho — but you'll have to purchase mortgage insurance and pay more interest over the life of your loan.

Your down payment is the first part of your home's purchase price that you pay at closing. Your mortgage lender will pay the remaining balance.

Typically, mortgage lenders in Idaho want you to contribute 20% of the purchase price as a down payment. That would be $93,577 for a $467,883 home — the typical home value in Idaho.

However, you have options to lower your down payment amount.

Government backed loans, like VA and FHA loans, allow you to contribute 0% and 3.5% of your home's purchase price respectively. Even conventional loans allow for down payments as low as 3-5% (though the minimum varies by lender).

Mortgage type
Minimum down payment (%)
Down payment ($)
VA Loan
0%
$0
FHA Loan
3.5%
$16,376
Conventional
3%
$14,036
Based on typical home values from Zillow (August 2022)

But making a down payment of less than 20% comes with some risks.

First, because you're borrowing more money, you'll have a higher monthly payment and pay more in interest over the life of your loan.

Down payment
Monthly payment
Total interest
Total Cost
5%
$2,555
$475,139
$943,022
20%
$2,151
$400,117
$868,000
Based on home values from Zillow (August 2022) and a 5.61% interest rate for a 30-year loan.

Second, you may have to purchase mortgage insurance.

Conventional loans require private mortgage insurance (PMI) until your loan balance reaches 80% of the purchase price. FHA loans, on the other hand, require a mortgage insurance premium (MIP) for the life of your loans.

Mortgage insurance costs around 1% of your mortgage balance annually. However, rates vary based on your down payment and credit score. Typically, your mortgage insurance payment is added to your mortgage payment each month.

VA loans don't charge mortgage insurance. Instead, you'll pay a VA loan funding fee at closing, which can range from 1.4% to 3.6% of the purchase price.

» READ MORE: Everything you need to know about low-income home loans

Idaho down payment assistance programs

There are many down payment assistance programs offered across the country for prospective buyers just like you. In Idaho, you can choose from a number of local and national programs depending on your needs and household income.

Here are just a few down payment assistance programs offered specifically for Idaho homebuyers:

Down Payment/Closing Cost Assistance

The Idaho Housing and Finance Association offers a Down Payment/Closing Cost Assistance program to eligible borrowers as a second mortgage or a forgivable loan.

Qualified homebuyers can receive a second mortgage with a fixed rate of 5% over 10 years. To qualify for the program, participants must have a credit score of at least 640, complete a homebuyer education course, and contribute at least 0.5% of the home's purchase price.

Other homebuyers may be eligible to receive a forgivable loan for up to 5% of the sale price. It's a tiered program that decreases 10% each year, so the loan is fully forgiven at the end of year 10. To qualify for a forgivable loan, borrowers must take a homebuyer education course and contribute at least 0.5% of the home's purchase price.

U.S. Department of Housing and Urban Development

HUD’s list of alternative programs in Idaho can be found here.

Step 2: Find a great real estate agent in Idaho

🔑 Key takeaway:

Interview multiple agents to find one who knows your target neighborhoods, has experience in your price range, and communicates well.

Your real estate agent will be your main ally during the home buying process. Besides finding and showing you properties, your agent will help you make offers, negotiate contracts, and navigate the closing process. Plus, they can recommend other service providers like title companies and inspectors to help you buy your home in Idaho.

Don't rush into choosing an agent. Instead, take the time to research and interview multiple real estate agents who have experience in the neighborhoods you're interested in. You should pay attention to a realtor's:

  • Years of experience
  • Number of transactions in the last year (the more the better!)
  • Experience in your price range
  • Overall review score
  • Individual reviews and complaints

Top Local Agents Hand-Picked for You!

Clever matches you with multiple agents in your area so you can interview, compare, and choose the best one to help you buy your next home.

Step 3: Get preapproved for a mortgage

🔑 Key takeaway:

Once you're preapproved for a mortgage, it's imperative that your financial situation doesn't change. If your credit drops, it can derail the process and keep you from closing on your house.

Here are some easy ways to ensure your credit doesn't change after you receive your preapproval letter:

  • Avoid opening new credit accounts
  • Don't close any accounts that have been open for a long time
  • Make all of your credit card payments on time

» LEARN MORE: What factors do mortgage lenders consider?

A mortgage preapproval letter is an offer to lend you up to a certain amount of money to purchase a home. It shows sellers that you are a serious buyer who is financially qualified to make an offer on a home.

Most sellers in Idaho will require preapproval before showing you their home.

You don't have to decide on one lender right now. In fact, you should compare interest rates and preapproval amounts from several lenders to make sure you're getting the absolute best terms when you buy your Idaho home.

Get Pre-approved Today!

Get matched with a lender who can tell you how much house you can afford. To get started, where do you plan on buying?

Step 4: Choose the right location

🔑 Key takeaway:

Search for neighborhoods where:

  • Home prices are within your price range
  • Home values are on the rise
  • The local amenities support your lifestyle

Currently, the typical home value in Idaho is $467,883, but don't worry if that doesn't perfectly match your budget. Home prices vary dramatically from city to city and even from neighborhood to neighborhood!

Also, look at past home value trends. This will give you an idea of how much your home's value could go up over the next few years.

To give you an idea of how appreciation could impact what your house is worth in the future, consider these examples from three neighborhoods in Boise:

Home value appreciation in Boise

Neighborhood
2015
Current
Appreciation
Southeast Boise
$215,427
$544,606
60.4%
West Valley
$174,641
$455,993
61.7%
West Bench
$170,879
$451,296
62.1%

Step 5: Start house hunting in Idaho

🔑 Key takeaway:

Houses have been flooding into Idaho’s market, giving you quite a few homes to choose from. And while listing prices have been climbing up, your agent may be able to use the surge in inventory to negotiate a better deal on available houses. If you can be flexible with your budget, you may even get a house that’s better than what you expected without having to shell out too much extra.

Searching for homes in Idaho is the fun part of the home buying process! You'll get to look at a variety of homes and discover what you really want in a home.

Make a list of everything you want in a home and prioritize them. At the top of the list should be the items that are most important to you. This will help you separate your "must-haves" from your "nice-to-haves."

Your agent can help you understand if your wants are realistic for your budget and favorite neighborhoods or if you need to rethink what you're looking for.

Look at current housing inventory

The timing of your house hunt in Idaho can have a big impact on your number of options. For example, in Idaho, June has historically seen the most homes for sale. Searching in this season could give you more options and a greater likelihood of finding your dream home.

On the other hand, December gives you the fewest choices in Idaho. Historically, there are 56.0% fewer homes for sale than during Idaho's peak season.

Housing inventory in Idaho by season

Season
New listings per month
Spring
4,051
Summer
4,499
Fall
3,275
Winter
2,428
Based on data from Realtor.com (September 2022)

Step 6: Make an offer

🔑 Key takeaway:

Although there is a lot of inventory in Idaho, great listings are getting snatched out of the market fast. If you find a house you like, you will need to act quickly; you may even have to put in an offer on the same day of viewing the house. For the best chance of having an offer accepted, consult with your realtor. You may need to put in a highly competitive offer to swing a purchase your way in desirable neighborhoods or move-in-ready homes.

Once you find a Idaho house you love, it's time to make an offer. Your real estate agent will help you write a compelling offer that gives you the best shot of convincing the homeowner to sell to you.

Currently, in Idaho, homes stay on the market for 59 days before going under contract. However, every market goes through seasonal changes. During busier months, homes get snatched up more quickly than others.

Historically, Idaho homes sell fastest in June, where the average property is only on the market for 42 days. If your home search falls around this time, you should be prepared to move quickly and potentially make offers on several homes before yours is accepted.

On the other hand, if you buy in December, you have a bit more time to search. Homes typically stay on the market 22 days longer than Idaho's annual average.

Average time homes spend on market in Idaho

Annual average
59 days
January
80 days
February
67 days
March
50 days
April
41 days
May
40 days
June
40 days
July
45 days
August
51 days
September
57 days
October
62 days
November
69 days
December
77 days
Based on data from Realtor.com (September 2022)

» LEARN MORE: What should an offer include?

👋 Next Steps: Talk to an expert!

If you're weighing your options for buying or selling a house, Clever can help!

Our fully-licensed concierge team is standing by to answer questions and provide free, objective advice on getting the best outcome with your sale or purchase.

Ready to get started?

Give us a call at 1-833-2-CLEVER or enter your info below. Our concierge team will be in touch shortly to help.

Remember, this service is 100% free and there’s never any obligation.

Step 7: Inspections and appraisals

Inspections and appraisals are an opportunity for you to better evaluate the home's condition and value before officially purchasing it. You may have an opportunity after this step to renegotiate the terms of your contract with the seller if something unexpected pops up.

🔑 Key takeaway:

  • Inspections: A licensed professional checks the house for any unseen, unexpected, or potential issues.
  • Appraisals: An appraiser hired by your lender examines the house to determine how much it's worth.

Home inspections in Idaho

Having your Idaho home inspected by a licensed inspector gives you peace of mind about the condition of the property before you commit thousands of dollars to purchase it.

Your inspector should check out the following parts of the property:

  • Roof
  • Foundation
  • Electrical system
  • HVAC system
  • Plumbing

If the home has a septic system, you should also pay for a septic inspection to make sure it doesn't have any problems that wouldn't be covered in a typical home inspection.

Idaho-specific inspections

Idaho doesn't have strict disclosure laws for sellers, so it's up to the buyer to have the property thoroughly inspected. In addition to a general home inspection, it's a good idea to complete these other tests as well:

  • Radon testing: Radon is a dangerous substance that can leak into a home's air or water supply undetected. Since sellers aren't required to test for radon before listing their properties, buyers are highly recommended to check for potential radon hazards prior to closing.

    Idaho’s Department of Health and Welfare offers one free radon testing kit per household. You can get yours here.

    • Mold inspection: Mold can impact the safety of your home and the health of your family if it has the chance to spread. Getting a mold inspection as soon as possible will reassure you that a potential home will be safe and clean for your family.

    Appraisals

    Appraisals determine the value of the property. If you're using a mortgage to buy your new home, your lender will order an appraisal to make sure the home is worth the money that it's loaning you.

    » LEARN: 3 options for buyers after a low appraisal

    Step 8: Close on your new home!

    🔑 Key takeaway:

    Before you close on your new home, you and your agent will do a final walkthrough of the property to ensure that it's still in the expected condition.

    Closing on a home in Idaho requires you to complete two final tasks at the title company. On closing day, you'll be asked to review some essential paperwork and pay your closing costs.

    It's recommended to read through the required documents ahead of time to make sure you fully understand them. You'll need to sign several important forms, including:

    • The mortgage promissory note
    • The deed
    • Disclosure statements

    After completing your paperwork, you'll simply have to settle your closing costs. The title company will collect the total amount you owe and distribute payments to the appropriate parties.

    Homebuyer closing costs can usually be broken down into four distinct categories:

    • Prepaid costs: Ongoing costs of homeownership. Most lenders require new buyers to pay certain fees up front, such as property taxes and homeowners insurance.
    • Lender fees: Fees paid to your mortgage lender for services related to your loan. These fees cover the origination and underwriting of your loan, as well as the appraisal fee and any mortgage points.
    • Title and escrow charges: Fees paid to the title company for facilitating the closing. These charges may also pay for their research and documentation of the title.
    • Other closing costs: Miscellaneous costs that depend on each buyer's circumstances. Some common costs may include pest inspection services, real estate attorney fees, or flood insurance.

    Buyers in Idaho typically pay 3–5% of the purchase price in closing costs. For a $467,900 home — the typical home value in Idaho — that's between $14,037 and $23,395!

    » LEARN MORE: Closing costs for buyers in Idaho

    Should you hire a real estate attorney?

    Idaho does not require you to hire a real estate attorney to buy a home. However, depending on your circumstances, you might consider hiring one anyways. If you do, treat the process similarly to hiring an agent. Interview multiple attorneys and proceed with the one that best meets your needs.

    Frequently asked questions

    1. Save for down payment
    2. Get pre-approved for a mortgage
    3. Choose your preferred Idaho neighborhoods
    4. Partner with the right real estate agent in Idaho
    5. Go house hunting
    6. Make a strong offer
    7. Inspections and appraisals
    8. Do a final walkthrough and close

    Yes! The Idaho Housing and Finance Association offers a few programs for first-time and repeat buyers. The IHFA provides home loans with low financing rates to buyers earning no more than $125,000 annually. Eligible participants may also apply for down payment assistance or get tax credits worth up to $2,000 per year.

    » READ: What are the top first-time homebuyer programs?

    Related links

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