I dont think were going to get a recession now, in Utah., Eskic, smiling, said he and Wood should make a bet on stage. Do not sell or share my personal information. There were 73 homes sold in December this . 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. But what about the increase in interest rates? 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? With the rise of interest rates, a significant economic shift is occurring and we will likely see Utah home sales temper buyer demand. After prices peaked in May, Salt Lake Countys median single family home price hit $650,000. They also anticipate prices to grow 8.5% and sales to grow 15.2%. There are currently 8,551 residential homes for sale in the United States.. The Utah housing market benefits from the states attractivity, which features a strong economy and job market. All of this, of course, depends on how local markets fair. Forecasted home price change: +8.5%. If you ask Branca, 2022 definitely wasnt the year for buyers either. Please check your email to verify your account. Yeah, thats a valid point, Wood replied, drawing laughs from the crowd. If you are looking to purchase your primary residence in todays market, then yes, the time to buy is today! They can step back and wait for the dust to settle., As a result, Wood predicted price declines that have been tumbling since May will stabilize by the third quarter of 2023, and the annual median sales price for 2023 will likely be within a few percentage points one way or another of 2022., Worst case scenario, Wood added, prices down about 5%; best case scenario, prices equal to 2022.. As for interest rates, Wood noted forecasts vary widely, anywhere from 5% to 9%, but he personally expects rates to bounce between 6.5% and 7.5% in 2023. These factors positioned Utah in the top spot on the Bankrate Housing Heat Index. When he first started looking in November 2021 and into early 2022, Salt Lake Countys median single-family home price had hit $580,000, up 24% from a year earlier, according to the Salt Lake Board of Realtors. I like the word contraction better than collapse, said Jim Wood, director of research and science and the Ivory-Boyer senior fellow at the Kem C. Gardner Institute. By Sarah Burns of The Salt Lake Local Real Estate Group, October 21, 2021 Utah State #2 in Housing Price Increases Utah's equity gains sat at 28.3% between 2020 and 2021, making Utah #2 in housing . Joining Good Morning Utah to share what to expect for Utah's housing market for 2022 is Ryan Kirkham with Summit Sotheby's and Utah realestate.com. The average months of supply is 3 months, up 3 year over year. While Utah is below the national average in many areas, home prices have managed to remain strong. Neither Wood nor Eskic are predicting a catastrophic, 2007-like crash that sent the global economy tumbling into the Great Recession. All Rights Reserved, What will 2023 bring to the housing market? This is the MOST ACCURATE UTAH Housing Market Forecast for 2022. Agents receive this question at least 10 to 15 times per week. The median price of a home in the United States is currently $518,200.. 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. Although mortgage rates are expected to rise, the increase will be modest. Wallethub found Utah is the. 2022. The Utah housing market is following many of the same patterns observed nationwide. Housing prices are deemed overvalued when their local incomes, job market, and economy do not support the sale prices. 2022's housing market follows Utah's hottest housing year ever . Utahs housing market is starting to feel the rising interest rates, resulting in plateaued price growth. 2.1 months of housing inventory. Eskic, however, is predicting Utah home prices will drop 9% year over year in 2023. Inventory levels have skyrocketed, with the average number of homes on the market up a remarkable 248% from the same period in 2021. You can try RealAdvisor home value appraiser, to get the value of your home in Utah. After a long, over two-year frenzy, Perry said buyers had more breathing room to negotiate prices and complete their due diligence. Utahs economy continues to add jobs, but the pace of growth has started to slow. A good indication of the markets strength and inventory is the average number of days properties stay listed. 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 2022, four consecutive 75 bps increases brought mortgage rates over 7%, reaching their highest level since April 2008 and standing over twice higher as the same time last year. The average sale price in the fourth quarter rose a modest .6% from the fourth quarter of 2021 to $604,105. If you dont see our email and have already checked your spam or junk folder, please give us a call at 1 (800) 319-0511. The Midwest, he said, will likely see minimal price increases.. Book an appointment today. A high or growing percentage of homes selling above list. 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. The discussion between Eskic and Wood was moderated by Clark Ivory, CEO of Ivory Homes, which is Utahs largest homebuilder. Prices were 3.7% lower than in the third quarter of 2022. But high mortgage rates, some weeks hovering over 7%, did trigger a type of collapse in demand and sales. The competition has been made even tougher since the pandemic started, with people from California and Colorado making their exodus to the Beehive State in search of more affordable housing along with a good educational system and a lower cost of living. By Eskics calculations, 79% of Utah households couldnt afford the states median priced home as of the third quarter of 2022. But housing costs werent nearly as high back then, Eskic interjected. It boasts some of the best snow on planet earth! 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. After a peak of the housing market in May 2022, when the Utah median home price reached a record $577,500, Utah house prices have slowly been decreasing, although they remain higher than they were the year prior. On average, homes in Cache County sell after 57 days on the market compared to 12 days last year. Along with his love of family, he has a very strong competitive spirit, is passionate about personal development, and truly cares for others. Utah remains a sellers market as inventory levels have yet to return to their pre-pandemic levels. Industry experts and analysts have recently released their different takes on various US housing markets. My current forecast is that mortgage rates will trend lower as we move through the year. The median sale price was up 5.6% in September 2022 Y-O-Y, but the number of homes sold dropped 26.7%. At an annual rate of 2.6%, this was the slowest pace of growth since the state started recovering jobs post-COVID. Next came Sacramento, Las Vegas, Phoenix, and Tampa. Instead, he was actually looking at a mortgage payment of up to $4,200 a month, depending on the days rate. 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. Doing read more, Click here to browse our Real Estate Agent Directory and contact top-rated agents in your area! The bull market that has been in place for quite some time appears to have lost its momentum. Some, however, say the market needs this correction to reach a more healthy equilibrium between sellers and buyers as well as healthier affordability. 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. At the same time, the number of homes sold fell 34.7% and the number of homes for sale rose 81.9%. If they hadnt been so aggressive in 2020 and 2021, wed be talking about unemployment now rather than inflation. He also noted it was really Congress that juiced the economy with so much one-time stimulus money, not the Fed. Even this far into 2022 with the mortgage rate hikes, Utah remains one of the hottest markets. So unless we have a real serious recession, I think prices have some support given our economy., Wood also said even if home prices dropped 10%, they wouldnt set off a wave of foreclosures, unlike what happened in 2008, which just pulled prices down. Despite the wild 2021 ride we all took inflation, a spike in gas prices, and a persistent global health crisis 2022 is looking to be another unique year for the Utah real estate market. They didnt go down.. To ensure a good return on investment, we encourage real estate investors to perform their due diligence and seek out the help of local Utah real estate professionals. Thats when buyers found their affordability ceiling. Privacy . 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. South Carolina Housing Market 2023 Report, North Carolina Housing Market 2023 Report. In January 2023, there were 8,551 homes for sale in Utah, up 81.9% year over year. If 2022 was a roller coaster year for the housing market, 2023 is expected to bring a painful but necessary real estate hangover. Utah house prices are significantly higher than the national average, and local salaries are not keeping up with the price growth and inflation. This gives us a 23.7% combined overall growth rate This projected growth puts them ahead of other booming markets like Boise City ID, Spokane WA, and Indianapolis IN. 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. If you ask Perry, they have a silver lining. 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. 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. 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