Are we in a BUBBLE?
While nobody can ever be sure where the "highs" and "lows" are, Utah's real estate market has some serious muscle. With low interest rates typically under 5% and strong economic growth, we are seeing a substantial increase in home sales and expect this to continue.
According to the Salt Lake Board of Realtors®, Salt Lake City, West Jordan and Sandy were the Top 3 Cities for Highest Home Sales in 2017. Combined sales in 2017 of single-family and multifamily homes in Salt Lake County totaled 17,804 units, the third highest year ever. See Figure 1 below:
Also, according to the Salt Lake Board of Realtors®, the median sales price of a single-family home in Salt Lake County increased approximately 10% in 2017 to $325,000 and since 2011, the median sales price has increased overall by approximately 50%, up from $216,431. Housing price increases in the county rank among the highest in the United States. See Figure 2 below:
This means that according to the Wells Fargo/National Home Builders Housing Opportunity Index (HOI), a median income household could afford 65 percent of homes sold in Salt Lake County.
Lending requirements have tightened up since our last bubble in 2008 and household debt has remained substantially stable, so this helps, and with more millennials than ever purchasing homes and new construction highs, we anticipate that prices will continue to increase, due to market demands.
If you'd like a free market analysis for your existing home or are considering purchasing a new home, contact us now at 801-999-8005. We'd love to guide you and take the weight off!