Where do we go from here? Earlier in 2021, Utah was considered as one of the hottest markets in the country, second only to Idaho. Such a decline is extremely unlikely in Utah in 2023 and 2024, Wood wrote. We hope that this information may assist you with making better-informed real estate decisions. Thats a good thing, because they were overpriced anyway, right? Perry said. However, because of the stiff competition, Utahns who are looking to buy property should prepare themselves not just financially and physically but also mentally. Roughly two-thirds of the population live in the Wasatch Front in the north-central part of the state, which includes the capital city, Salt Lake City. Sign up now for a free 7-day trial and get 15% off on your subscription. This would place . Hes employed as a professional actor and director of marketing and advertising at Hale Center Theater Orem, as well as director of communications at the Salt Lake Acting Company. 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. Prices were 3.7% lower than in the third quarter of 2022. All Rights Reserved, Why two housing experts disagree on how much Utah home prices will drop in 2023, priced some two-thirds of Utahns out of affording the median priced home, Housing market is correcting but Utahs affordability crisis isnt going away. Eskic, however, is predicting Utah home prices will drop 9% year over year in 2023. The following analysis of select counties of the Utah real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. While the market in Utah is feeling a correction similar to the rest of the Nation, it weathered the 2008 recession relatively well and is expected to maintain a strong housing market. Inventory levels have skyrocketed, with the average number of homes on the market up a remarkable 248% from the same period in 2021. Additionally, both Wood and Eskic predict Utahs estimated 31,000-unit housing shortage will continue to keep home prices high, even if the state sees some price drops, so they expect Utahs housing affordability crisis to remain a persistent issue that is pricing out more than 75% of Utahns from affording the states median-priced home. Prices, though theyre on a downward trajectory, are still up year over year by single-digit percentages at least for now. 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. If you would like to buy a house in this dynamic state, the best time to house hunt is in the early spring (April) when inventory is at its highest in preparation for the hot summer real estate market, and Utah house prices are at their lowest. Below is the latest Utah housing market trends analysis. It will test their mettle and resolve as it will be an exercise in decision-making and patience. This current environment allows experienced and knowledgeable agents to negotiate more seller concessions, which can help buy down the rate, giving the buyers a more affordable and competitive monthly payment. Utah hosted the 2002 Winter games, and Utah is looking to once again host these games once again. The average annual profit of property investment was: 10.098% in 2018; . For further information about the housing market in your area, please dont hesitate to contact your Windermere Real Estate agent. The Utah housing market does not yet significantly favor home buyers but, given the data discussed in this report, it has certainly shifted away from sellers and into neutral territory. While Utah is below the national average in many areas, home prices have managed to remain strong. However, during the Great Recession, prices declined for years before accelerating again. Buying read more, FastExpert, Inc is a California Licensed Broker. Historically, brief and prolonged price declines in Utah went hand in hand with joblessness and recessions, both of which dont seem likely in the next two to three years. Even this far into 2022 with the mortgage rate hikes, Utah remains one of the hottest markets. It isnt easy to quantify the benefits of delaying purchasing your primary residence. Given that interest rates more than doubled in less than a year, its impossible for there not to be an impact on the housing market. As of November, that figure was down to $569,000 14% lower than the May peak but still 4% higher than in November of 2021. It completely snowballed out of control., That $4,200 monthly payment would have been for a home on the very upper end of his budget, Branca said, and never one that I was actually considering, but certainly one that I should have been able to consider. Boating in Utah can be an unmatched experience. The Utah housing market became one of the most competitive in the country, especially in areas like Salt Lake City and St. George. According to data collected in September 2022, the latest available at the time of writing, the median sale price for a house in Utah stood at $533,500, representing a 5.6% increase compared to September 2021. Here are the latest figures, The Wests housing crunch began over a decade ago. Property values will likely decline over the next 6 to 12 months and then flatten in the Utah housing market. Buyers finally have market power. Hang in there. You can find some of the most distinguished and reputable real estate agents using Mashvisors real estate agent directory. In 2021 the average interest rate was 2.96%, the lowest interest rate that FreddieMac measured since 1971. Utah is expected to continue its rapid growth and will need to see an increase in available housing to accommodate the incoming population. Click here to browse our Real Estate Agent Directory and contact top-rated agents in your area! Sign In. Eskic said it all comes down to affordability. A high or growing percentage of homes selling above list. According to him, about half a million Californians browsed the website UtahRealEstate.com in search of property to buy. The discussion between Eskic and Wood was moderated by Clark Ivory, CEO of Ivory Homes, which is Utahs largest homebuilder. The party was over. This would place . Heres why, 2021: The year of the shocking home price, Utah made a dent on its housing shortage in 2021 but is still 31,000 units short, Buying a house? The latest migration analysis is based on a sample of about two All Rights Reserved. Three of the top ten most overvalued US housing markets are in Utah. But housing costs werent nearly as high back then, Eskic interjected. He expects buyers and sellers will step back and wait for the dust to settle, many of them locked in at low, 3% mortgage rates that helped send the nations housing market into a frenzy in 2020 and 2021. Salt Lake City is the capital and most populous city of Utah, with a population of 200,133, Salt Lake City housing market is somewhat competitive, with listed properties receiving three offers per listing and 24.5% of them selling above the asking price. Half a million people from one state alone. It is equally impressive to see that the unemployment rate remained at a very low level even as the state added over 52,400 people to the workforce. Theycan also indicate whether homes are lingering on the market or being sold faster than sellers are listing them. If you are investing in real estate properties to rent out as vacation homes, find out the short-term rental laws in the city and county youre considering. With the market starting to change, weve seen a decrease of 25.3% in sales in the Utah housing market, and 49% of homes had price drops. But now, those days of wild buyer demand and a frenzy of seller activity is over, and real estate agents outnumber active listings. We break down our data by county, but we cover major cities in this region including Salt Lake City, West Valley City, Provo, and West Jordan. The median sale price was up 5.6% in September 2022 Y-O-Y, but the number of homes sold dropped 26.7%. From peak-to-trough, with the peak being May 2022, he expects prices to decline by a percentage somewhere in the mid to low teens, depending on what happens with interest rates over coming months. Moodys Analytics expects a peak-to-trough U.S. home price decline of 10% or a 15% to 20% decline if a recession hits. They also anticipate prices to grow 8.5% and sales to grow 15.2%. increase. Browse through the largest marketplace of Real Estate professionals, We have an in-house team that will guide you through the process. But, we had a recession then, Dejan, we had a recession. All rights reserved. Compared to the third quarter of 2022, average home prices fell in every area other than Summit County, where they rose .8%. So from that affordability perspective, I think its going to keep the market from accelerating back to have a more positive price appreciation., Wood said thats a good point, but added the 70s and early 80s saw interest rates that hit as high as 18%. However, as the level of Utah housing prices outstripped the national average, the demand is bound to decline as salaries are not increasing nearly as fast as property prices. Joseph Branca, left, makes a drink while his partner Scotty Fletcher makes dinner at their apartment they rent in Salt Lake City on Thursday, Dec. 29, 2022. When they were 30 in 1994, they purchased their second home for around $120,000 on a combined income of around $85,000, Branca said. A year from now whoevers right has to shave their beard off.. Home sales: 3,219 - 26.7% less than a year ago. 2020 further increased that number to almost 73% as median home sales prices reached $380,000. Park City Data 28.7% of homes sold above the asking price, reaching a median sale price of $525,000, which represents a 7.8% increase in the past year. A realty sign at a property in the Salt Lake City on Friday, Jan. 6, 2023. Hes predicting Utah home prices will drop 9% year over year in 2023. Median List Price $524,900 $285/sqft Based on all homes listed in January 2023. The median sale price for a house in West Valley City was $436,500 in September 2022, representing a 2.9% increase in year-over-year comparisons. Utah Housing Market Overview What is the housing market like right now? However, it is also the third-most populous city in Utah, with a population of 116,961. Wood said he was a little bit more optimistic, predicting minor blips that will stabilize into the green after only a few quarters. The average sale price in the fourth quarter rose a modest .6% from the fourth quarter of 2021 to $604,105. If rates had risen to around 4.5%, the train would still go. Utah Housing Market- Trends and Predictions for 2022, Preston Hicks Real Estate Group - JMG Utah, What does exclusive right to sell mean? Utah faces a shortage of 31,000 homes. 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