At the time of the writing, the Utah housing market remains a sellers market as the available inventory is not keeping up with the demand despite an increase in the number of houses for sale and months of housing supply. However, during the Great Recession, prices declined for years before accelerating again. While interest rates remain high, the coming year will likely see continued cooling of the housing market in Utah; however, lack of supply will buffer most markets. Since the pandemic began, housing prices in the Beehive State have skyrocketed to the point that more than 50% of households can no longer afford to buy median-priced properties in the state. Nationwide, 25% of homebuyers searched to move to a different metro area between Nov '22 - Jan '23. Below is the latest Utah housing market trends analysis. When is the best time to buy a house in Utah? And due to Utah being a robust economic powerhouse, this state will be poised for the quickest and most powerful market shift back to an unbalanced sellers market. Along with his love of family, he has a very strong competitive spirit, is passionate about personal development, and truly cares for others. The Utah housing market is amid a major shift. How the pandemic housing frenzy which drove housing prices up to unimaginable levels in 2021 and into early 2022, especially in Western states like Idaho and Utah came to a grinding halt mid year, and the market crashed down to reality. Eskic has a more bearish outlook. Now, we still have a very strong job market, and we expect the growth rate is going to come down a little bit in 2023 in jobs, but I still think its going to be a strong market, Wood said. With nearly 2,000 miles of shoreline, Lake Powell possesses endless outdoor adventures. Given the Utah housing market forecast 2022, here are the top real estate markets any wise investor can add to their real estate portfolio. Colorado Data Additionally. At the very least, folks can expect some sort of moderation over the next few years but not a decline. The impact of the correction on Utahs real estate market should be softened by its robust economy and limited home inventory. Housing prices have skyrocketed so much, now more than half of Utah's households are unable to afford the state's median priced home, which for single-family homes was $460,000 in 2021. One will often find him drawing, doing toy photography, or dabbling in other geeky stuff when he's not helping investors make smarter decisions. This was down 45% compared to the same period the previous year and down 27.8% compared to the third quarter of 2022. Thats not good news for affordability or Utahs housing shortage, which they calculate hit 31,000 units after the big home building boom of 2021. Dont focus on the loss you may believe you are experiencing if you sell today. Terms . In Utah, housing prices have begun to decline, down from their peak in May, when the median sales price of Salt Lake County homes was $565,600. Over 2022, the Federal Reserve has been battling sky-rocking inflation with their number one weapon, interest rates. When we look at just how much weve peaked earlier this year, I think well start seeing negative year-over-year readings late winter, early spring, Eskic said. Dont wait. It has been one of if not the most competitive markets in the US in 2021. Rising financing costs will hinder housing demand and we may see home sales cooling. In June 2020, the median sales price across Utah averaged $363,600 and has now jumped to $580,000. Alfred is a content writer with years of experience writing about the US housing market. Here are Utahs metropolitan areas with the hottest housing markets for volume. Heres why, The Wests sharp housing market correction: Heres how fast home prices have fallen in 4 months, Home sales are crashing down to reality in the West, What state lawmakers are doing to address Utahs housing crisis, Department of Labor reports that child labor has increased by nearly 70% since 2018, Feds hardwire child care benefits to $39 billion in CHIPS Act funding, Grit and circumstance: Bestselling author Angela Duckworth brings her wisdom to BYU, The starter home in Utah is extinct: How first-time homebuyers could get 20K for new homes, How a new service aims to help teens remove explicit internet images. 27.7% of homes sold above the asking price. Book an appointment today. of $518,200. On average, the number of homes sold was down 34.7% year over year and there were 1,769 homes sold in January this year, down 2,712 homes sold in January last year. But when mortgage rates ticked up, he said it quickly became apparent that he wasnt going to be able to buy a home with, say, a $1,600 monthly mortgage payment. Major Utah cities covered in this report: These Utah real estate reports, data, forecasts, and market trends are provided for informational use. There was a 98.0% sale-to-list price, down 2.7 points year over year. Scotty Fletcher, left, and his partner Joseph Branca pose for a photo in their apartment they rent in Salt Lake City on Thursday, Dec. 29, 2022. That is, after a summer of twist and turns, when prices peaked, interest rates went sky high, buyers were shocked out of the market, and sellers were saying, Wait, how come were not selling the home in two days? With the rise of interest rates, a significant economic shift is occurring and we will likely see Utah home sales temper buyer demand. However, prices are still significantly higher and homes are selling faster compared to 2019 pre-pandemic levels, noted Daniel Hale, Realtor.coms chief economist. Contact Us, Real Estate Blog But its not the bubble we know, The Wests sharp housing market correction: Heres how fast home prices have fallen in 4 months, Housing market is correcting but Utahs affordability crisis isnt going away. Months supply of inventory: 3 - up from 1 in September 2021. Get your free online home valuation in only 2 minutes! Should You Invest in the Phoenix Housing Market in 2020? RELATED: 'It's daunting:' How housing costs are affecting Utah's ski resort staff Listing prices, rents, and mortgage rates are all expected to climb while income rises. In addition, the number of homes has increased along with significant population growth. A home is listed for sale in West Jordan on Wednesday, Dec. 21, 2022. Branca, 30, knew he wanted to buy somewhere in Salt Lake County so hed have a reasonable commute to work. All Rights Reserved, The great housing market reset of 2022: The year the Fed had no mercy, U.S. navigating pandemic housing bubble, Fed chairman says. Home prices in Utah were down 3.0% year-over-year in January. Utah home prices remain significantly higher than the national average. In the beginning, Branca said his home hunt was exciting, kind of frenzied, certainly, but still manageable. The slate of speakers all sought to help bring clarity to a market that they said has largely been fraught with volatility and uncertainty as mortgage rates, some days hovering around 7%, have squeezed buyers and have brought a rapid end to what had been over two years of a blazing hot market. After the next seven months, the median price. The U.S. housing market is going through what Federal Reserve Chairman Jerome Powell has called a difficult correction and a reset as it comes off the tail end of a pandemic frenzy fueled housing bubble. In its fight with record inflation levels throughout 2022, the Fed made a series of aggressive borrowing rate hikes, which translated to a spike in mortgage rates that priced or spooked buyers out of the market. Instead, he was actually looking at a mortgage payment of up to $4,200 a month, depending on the days rate. Median sale price: $611,600. Others argue the apartments meet the growing demand for high-end housing in Salt Lake City, it's the latest development in what's been an expensive year to find and afford a home. By comparison, interest rates 20 years ago averaged between 6%-7%, and 1981 experienced interest rates of 16%. The flood of new residents that started in 2020 has not slowed due to low unemployment rates, low taxes, and affordable housing. Even with the recent slowdown, a correctly priced home will sell, and it will sell with record equity growth over the last 10-year average. Branca said hes grateful that hes employed, has a handsome income, and while hes sad that the market was so difficult to navigate for his situation, it felt much worse to realize just how many other Utahns the market has priced out. However, because of the stiff competition, Utahns who are looking to buy property should prepare themselves not just financially and physically but also mentally. All Rights Reserved. Eskic, however, is predicting Utah home prices will drop 9% year over year in 2023. When he thinks about what his parents life was like in the same window of time in their lives, he said it blows his mind. This was marginally below the rate of the prior year but impressive all the same. If you ask Branca, 2022 definitely wasnt the year for buyers either. Homes that sold above list price likely received multiple offers. The jarring pace of Utah's housing market and its impact on Utahns "is why we think these investments are so important," Cox said. Copyright: 2023 Redfin. There was a 98.0% sale-to-list price, down 2.7 points year over year. In 2022, Redfin itself went through two rounds of layoffs. In his report for Utah, Wood wrote its very unlikely that the recent price run-up represents a housing bubble, though he added, We dont know if a bubble exists until after it bursts. He cited Alan Greenspan, an economist and past chairman of the Federal Reserve, who defined a housing bubble as a prolonged period of housing price declines. Thank you for registering with FastExpert. Buyers were actually offering pizza, cookies, even Utah Jazz tickets to literally sweeten the deal, all kinds of crazy stuff that real estate agents had to make sure to handle correctly. over year. For this reason, despite the high median property price, investors in rental properties are most likely to enjoy very good returns. At the same time, the number of homes sold fell 34.7% and the number of homes for sale rose 81.9%. A low or shrinking percentage of homes selling above list price suggests that the market is becoming less competitive. In addition, Utahs median listing price is 36% more than homes across the United States. In Utah, because of its continued strong job economy, experts predict the states housing market to experience some turbulence in 2023 but come out strong next year. FastExpert partner and Utah real estate agent, Preston Hicks, shares his professional perspective on the Utah housing market. The latest migration analysis is based on a sample of about two Eskic, however, is predicting Utah home prices will drop 9% year over year in 2023. The best way to describe it, he said, is an abrupt contraction thats had a dramatic effect on all aspects of the market, but especially on homebuilding, which he and Eskic worry will exacerbate Utahs housing shortage long term. Historical Utah real estate data and trends are included below the latest update. (Now) its resetting, its balancing, its coming down.. But having price declines is really unusual, Wood said. Some buy-and-hold while others enter the rental market for passive income. between 2021-12-31 and 2022-12-31. As the demand for housing decreases as buyers find themselves priced out of the market by the increasing cost of borrowing money or postpone their homebuying plans to preserve their buying power, we can expect Utah housing prices to stabilize or diminish. The median sale price was up 5.6% in September 2022 Y-O-Y, but the number of homes sold dropped 26.7%. The National Association of Realtors, however, is predicting 2023 will be a year the market will regain normalcy, expecting mortgage rates to stabilize, home sales to sag and prices to moderate. This was down 45 % compared to the third quarter of 2022 listing price is 36 more... 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