Utah Real Estate

Utah Real Estate Market Update Report Title Page

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The real estate market in Utah has drastically changed in recent years as well as nationwide. Below are some of the statistics I have pulled from several sources.

To download the complete PDF report click here:

Utah Real Estate Market Update Report (PDF) – Approx. 7.75MB.

Industry Facts:

Overall we are experiencing a “lack of inventory.” What exactly does that mean? Well, in 2011 the average supply of listed inventory was 7.1 months, and for 2012 it was 5.5 months. It means that if no one else listed their home it would essentially take 5.5 months to sell all the homes that are currently on the market.

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One reason there is a shortage in inventory is that consumer confidence is not yet up since the market crash of 2008.

Currently a median income family would have 160% of the income needed o purchase a median-priced home. Mortgage rates are still at an all time low. The combination of low rates with high demand and a shortage of supply forces home prices up.

Over the next three years home prices are projected to go up by 15%. Rental rates are expected to increase by 50%.

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Mortgage Stats:

With mortgage rates having been so low for so long, they are anticipated to go up this year. The FED promised rates will remain low through 2014. But incremental rate hikes are expected.

The fear of higher interest rates will feed the desire for buyers to acquire a property even sooner. Due to these market conditions homeowners will have a greater desire to list their homes for sale.

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Distressed Properties:

Distressed property sales are at a 5-year low, with less-and-less bank owned, short sale, and HUD homes hitting the market. The so-called “shadow inventory” expected to be released by the larger banks may not have been a shadow after all, or solutions such as loan modifications may have dissolved the shadow inventory altogether.

Due to the market crash of 2008, many homeowners needing to sell may be required to short sale even now. That’s because the current market recovery hasn’t surpassed the over-inflated prices of 2006 & 2007.

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 Today’s Buyer:

Today’s home buyer is tech savvy and relies heavily on technology for their home purchase. 89% of all buyers use an agent and rely on that agent’s aptitude for technology to help them achieve their goal of home ownership.

These tech savvy buyers are also looking for updated homes that have been well-cared for and provide “greener” options; such as updated utilities with high efficiency furnaces, and appliances. Sellers should keep in mind the necessary updating needed before listed their home for sale.

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First-Time Home Buyer Facts:

Due to a higher-cost-of-living and smaller incomes, the first-time home buyer is fiscally savvy. Doing more to save money and decrease expenses. Though many will still rely on gift money, Utah Housing, or other government loan programs and/or grants to help fund their down payment.

It is very common for the majority of first time home buyers to have less money down and to use FHA finances. This type of financing usually requires buyers to ask up to 3% in closing costs.

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Seller Stats & Trends:

The majority of homes sellers want to move to get into something newer or bigger to meet a growing family. But for that large percentage of baby boomers who are now becoming empty-nesters, are now looking to downsize and minimize to help ease into retirement.

Because of the high demand, if sellers price right they should have their home under contract in no longer than a month.

Sellers are also very concerned about taking advantage of today’s technologies to sell their home. Most seek out a Realtor who has great internet and social media skills to give them more exposure and drive more traffic to their home and secure a potential home buyer.

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 Consumer Confidence Way Up!

For reasons already mentioned (low mortgage rates, increasing, rental rates, low inventory, etc.) consumers feel very confident about purchasing a home. More and more tenants are making the jump away from renting to purchasing each day. 57% percent of home buyers plan to buy within the next 6 months to take.

88% of consumers feel that home ownership is important and the greatest and largest investment they will make.

Conclusion

If you own a home and have contemplated selling in the near future, there is not time like the present. Due to the low inventory, you can get more for your home and sell much quicker than in a stagnant market.

Home buyers are also well off due to the low interest rates. They can afford more of a home if they desire, or can settle into a reasonable and modest home with a killer low payment.

References can be found on the PDF. Original PDF courtesy of Buffini and Company.