Prospective homebuyers in Utah could see a brief reprieve from rising prices, an economist predicts — but it may not last long.
Housing prices in the Beehive State are still higher than the national average. As of May, the median sales price for a home in Utah was 23% higher than the national median price of $444,000, according to data from Redfin, a national real estate brokerage.
As Salt Lake City and Utah remain popular places for people to move, that will only drive prices up more, said Daryl Fairweather, the chief economist at Redfin.
But there could be some good news ahead, she said, when there is a brief gap between mortgage rates eventually dropping and prices increasing.
“But I think it’s going to be pretty short-lived,” Fairweather said.
She added she doesn’t expect Utah’s market to become more affordable during the next year but that people should not try to time the market if they are looking to buy.
Home prices are mostly down from high point
Except for Garfield and Uintah counties, home prices in Utah were down in May from the high point that most counties hit in the spring and summer of 2022, according to Redfin data going back to January 2018.
Redfin data puts statewide median home sales prices at $545,900, and ranging from $258,000 in Beaver County to $1.2 million in Garfield and Summit counties.
Data from the Utah Association of Realtors shows similar but lower prices, with the statewide median at $509,900 and local medians ranging from $238,000 in Beaver County to $1.2 million in Summit County.
Those prices are up across the board from pre-pandemic sales but are down year-over-year in nine counties according to Redfin, and in 11 counties according to data from the Utah Association of Realtors.
Based on Redfin data, Garfield and Uintah counties had their highest median sale price in May at $1.2 million and $367,000 respectively. Data from the Utah Association of Realtors puts those price points slightly lower at $1.1 million in Garfield County and $343,500 in Uintah County.
Market could ‘quickly pick back up’
Though Utah’s market is following the national pattern and slowing down a bit, Fairweather said, it could “quickly pick back up.”
Salt Lake City has become more popular, she said, because of the surrounding area’s natural beauty and lower housing prices than California and other western states.
But there is limited supply, she said.
A Kem C. Gardner Policy Institute report on the state of Utah’s housing market forecasted a shortage of about 37,000 homes this year as the number of people moving here outpaces building.
“As more people move in, all it does is drive prices up,” Fairweather said.
There is some hope on the horizon, she said, predicting a moment when mortgage rates drop but prices don’t go up yet.
She doesn’t expect it to last long — maybe two or three months — and there is no guarantee on exactly when it could happen.
The break may not be long enough for many to buy a home, either, since “most people aren’t going to just take any home on the market,” she said.
Don’t try to time the market, do stay in budget
People looking to buy shouldn’t try to time out that potential reprieve in the market, Fairweather said.
They also shouldn’t overextend their budget banking on rates to fall, she said.
Going over budget is a likelihood in nearly every county.
A Salt Lake Tribune analysis earlier this year found the typical renter household can only buy a home and spend less than 28% of their income on a mortgage payment in Beaver County.
That’s still true based on May data from the Utah Association of Realtors, but Redfin data puts median home price about 0.3% outside a typical renter’s budget in Beaver County and at least 32% over budget in 27 other counties.
There was no sales data for Piute County from either source, and the Utah Association of Realtors shows only one home sold there this year as of May.
Fairweather recommended three courses: Keep renting within one’s budget and save money to buy later; look for a more affordable home by looking for a smaller home; or shop for a home in cities and towns with lower prices.
Megan Banta is The Salt Lake Tribune’s data enterprise reporter, a philanthropically supported position. The Tribune retains control over all editorial decisions.