The Salt Lake City housing market has been one of Millennials' toughest real estate markets due to limited supply relative to demand. Salt Lake City is a moderately walkable city with a population of approximately 186,419 people. While the city limits encompass 110 square miles, downtown runs nearly two miles from east to west and nearly two miles from north to south. Salt Lake City's population is also very young. The largest percentage of the city's population falls in the 25 to 39-year-old age group.
Couple that with a high school graduation rate, and a large number of college graduates and you have an attractive workforce for many large companies. The Salt Lake City area's economy is doing well, and it has one of the lowest unemployment rates in the U.S. Utah’s employment outlook during the pandemic continued to outperform the rest of the country.
The strength of the overall economy significantly impacts the real estate market as buyers' ability to support housing prices largely depends on key economic factors. The state’s economy has proved to be “one of the nation’s best in reemploying workers” as officials continued to actively encourage those drawing unemployment benefits to seek work in sectors less damaged by the pandemic.
Long-term demographic and economic growth has generated rapid increases in housing prices in Salt Lake County.
Current Salt Lake City Housing Market Trends 2023
These latest statistics indicate a dynamic and evolving housing market in Salt Lake City. The decrease in new listings and closed sales, as well as the increase in days on the market, may suggest a shift towards a more balanced market, providing buyers with more options and potentially easing the competitive nature of the market.
Key Metrics for August Year to Date
The Salt Lake City housing market in August 2023 shows several notable trends and changes when compared to the same period in 2022. Let's delve into the key metrics provided by the UTAH ASSOCIATION OF REALTORS®.
New Listings and Inventory
New Listings in August 2023 totaled 1,485, reflecting an 11.1% decrease compared to the previous year. Year-to-date, there were 10,349 new listings, a significant drop of 23.8%. This reduction in new listings can indicate a tighter market.
The Inventory of Homes for Sale in August 2023 stands at 2,463, showing a 15.9% decrease compared to the same period last year.
Pending Sales and Closed Sales
Pending Sales in August 2023 numbered 903, a significant 26.2% decrease compared to August 2022. Year-to-date, there were 8,017 pending sales, reflecting an 18.1% decline.
Closed Sales in August 2023 amounted to 1,112, indicating an 11.7% decrease compared to August 2022. Year-to-date, there were 7,854 closed sales, showing a substantial drop of 20.2%.
Median and Average Sales Prices
The Median Sales Price for homes in August 2023 was $521,500, which is a modest decrease of 0.7% when compared to the same month in 2022. Year-to-date, the Median Sales Price dropped to $512,170, showing a more significant decline of 4.3%.
The Average Sales Price for homes in August 2023 increased to $621,335, a 2.8% rise compared to August 2022. However, year-to-date, the Average Sales Price decreased to $597,338, down 2.9%.
Percent of Original List Price Received
In August 2023, sellers received 97.3% of the original list price, showing an increase of 0.8% compared to the same month in 2022. However, year-to-date, the percent of the original list price received dropped to 97.2%, down 4.1%.
Days on Market and Months Supply of Inventory
The Days on Market Until Sale increased by 20.0% in August 2023, reaching 36 days, compared to 30 days in August 2022.
The Months Supply of Inventory saw a 17.4% increase, with 2.7 months of supply in August 2023.
Salt Lake City Housing Market Forecast 2024
The Salt Lake City housing market, a significant part of the Utah real estate landscape, is experiencing notable trends and projections, as reported by Zillow. As of September 30, 2023, the average home value in Salt Lake City stands at $531,033, reflecting a 3.7% decrease over the past year. Furthermore, homes are going pending in approximately 15 days, indicating a swift and dynamic market environment.
Here are some key statistics and insights regarding the Salt Lake City housing market:
- 1-Year Market Forecast (September 30, 2023): Zillow's market forecast for Salt Lake City indicates a 2.4% increase in home values for the coming year. While recent trends show a decrease, there's optimism for the future.
- Median Sale to List Ratio (August 31, 2023): The median sale-to-list ratio for August 2023 was 1.000, suggesting that homes were typically sold at or very close to their listing prices.
- Percent of Sales Over List Price (August 31, 2023): In August 2023, approximately 37.0% of sales went over the list price, indicating strong demand and competitive dynamics in the market.
- Percent of Sales Under List Price (August 31, 2023): About 41.1% of sales were under the list price in August 2023, providing opportunities for buyers to negotiate favorable terms.
- Median Days to Pending (September 30, 2023): The median time it took for homes to go pending was just 15 days as of September 30, 2023, showcasing the rapid pace of the Salt Lake City housing market.
What is the Housing Market Outlook for Salt Lake City?
Despite the recent decrease in home values, the 1-year market forecast indicates a positive outlook for Salt Lake City, with a projected 2.4% increase in home values by September 30, 2023. This suggests that while the market has experienced a downturn, there is potential for recovery and growth in the near future.
The dynamics of the market also show a healthy balance between homes selling above and below the list price, with a significant percentage of sales happening above the list price. This competitive environment is indicative of strong demand in Salt Lake City.
With homes going pending in just 15 days on average, the Salt Lake City housing market remains swift and dynamic. It's an environment where buyers and sellers need to act decisively to secure their desired outcomes.
In summary, the Salt Lake City housing market is experiencing fluctuations, but the forecast holds promise for a resurgence in home values. Buyers and sellers should closely monitor these trends and make informed decisions to navigate the evolving market successfully.
Salt Lake Real Estate Market: Should You Invest Here?
Salt Lake City, the capital of Utah, has garnered attention as a potential hotspot for real estate investment in recent years. A combination of demographic trends, long-term real estate appreciation, cost of living, quality of life, a thriving rental property market, landlord friendliness, population growth, and a robust local economy all contribute to the city's appeal as a real estate investment destination.
Salt Lake City's demographic trends are among the most promising factors for real estate investment. The city has experienced a steady influx of newcomers, including young professionals and families. These demographic shifts contribute to a growing demand for housing, making it an attractive market for real estate investors.
Long-Term Real Estate Appreciation
Long-term real estate appreciation in Salt Lake City has been substantial. The city has seen consistent growth in property values over the years. While there can be short-term fluctuations, the overall trend points towards a positive appreciation rate, making it an appealing prospect for investors seeking long-term gains.
Cost of Living & Quality of Life
Salt Lake City boasts a reasonable cost of living compared to other major metropolitan areas in the United States. The combination of affordable housing, competitive utilities, and accessible transportation options contributes to a more budget-friendly living environment. Additionally, the city offers a high quality of life with an abundance of outdoor recreational opportunities and a vibrant cultural scene.
Salt Lake City Rental Property Market
The rental property market in Salt Lake City is robust, driven by the city's population growth and the demand for housing. Real estate investors can benefit from steady rental income, especially in neighborhoods that attract young professionals and students attending local universities.
The Zumper Salt Lake City Metro Area Report analyzed active listings last month across the metro cities to show the most and least expensive cities and cities with the fastest growing rents. The Utah one bedroom median rent was $1,243 last month. Draper & South Jordan were tied for the most expensive city with one-bedrooms both priced at $1,430. Cedar City ranked as the most affordable city with one-bedrooms priced at $500.
The Fastest Growing Cities For Rents in the Salt Lake City Metro Area (Y/Y%)
- Clearfield had the fastest growing rent, up 9.3% since this time last year.
- Murray rent climbed 4.5%, making it second.
- Ogden was third with rent increasing 4.2%.
The Fastest Growing Cities For Rents in the Salt Lake City Metro Area (M/M%)
- Washington had the largest monthly growth rate, up 5.6%.
- Provo was second with rent climbing 5.4%.
- South Jordan saw rent increase 3.6%, making it third.
Salt Lake City is known for its landlord-friendly regulations. The state of Utah generally offers a favorable legal environment for property owners, including efficient eviction processes and fair property tax rates. These factors create a secure and attractive setting for real estate investment.
The population of Salt Lake City and the surrounding areas has been steadily increasing, driven by both natural growth and in-migration. The city's strong economy and diverse job opportunities have been a magnet for individuals seeking employment and a better quality of life. This population growth enhances the potential for real estate investments, as more residents require housing solutions.
Economy of the Region
The economy in Salt Lake City and the wider region is thriving. The city has become a hub for various industries, including technology, healthcare, finance, and outdoor recreation. Its diversified economy provides stability, reducing the risk associated with single-industry towns. A strong job market and higher income levels contribute to increased housing demand and, consequently, a healthy real estate market.
In conclusion, Salt Lake City presents an enticing opportunity for real estate investment due to its positive demographic trends, long-term appreciation, cost of living, quality of life, flourishing rental property market, landlord friendliness, population growth, and a resilient local economy. However, as with any investment, it's crucial for potential investors to conduct thorough research, consider their financial goals, and work with local real estate experts to make informed decisions.