The results for the 3rd quarter home and condo sales in Salt Lake County and Salt Lake City are in, and they look a lot like they did last year. The spring selling season is typically where most of the gains in the value of Salt Lake real estate happen, and that’s how it’s playing out in 2016.
The median sold price of a single family home in Salt Lake County was unchanged at $300,000 from the second to the third quarter of 2016. This is similar to 2015 when the median sold price increased only 1.1% between the second and third quarter. If you compare the third quarter of 2015 to the third quarter of 2016, the median sold price increased from $280,000 to $300,000, a 7.1% increase, but all that gain happened between the first and second quarters of 2016.
If you look at the graph below (SL County Single Family Homes Sales) and compare all the variables from quarter to quarter during 2015 to 2016, the changes in Homes Sold and Homes Listed consistently track with each other and have a very similar slope. The actual number of Homes Sold and Homes Listed are also very similar when comparing quarters from each year. The shape of the Median Sold Price graph is also very similar.
If the rest of 2016 goes like it did in 2015, prices will continue to flatten and slightly decline this fall and into the winter, as housing inventory decreases due to the best priced homes selling, fewer homes being listed for sale and some of the homes already listed but not yet sold being taken off the market for the holidays.
The median sold price of a single family home in Salt Lake City increased slightly from $306,000 to $309,000 from the second to the third quarter of 2016, a 1.0% increase. If you compare the second quarter of 2015 to the second quarter of 2016, the sold price went from $280,000 to $309,000, a 10.4% increase, but again, most of that gain happened during the second quarter of 2016.
The median sold price for a condo/townhouse in Salt Lake County decreased from $205,000 to $202,000 from the second to the third quarter of 2016, a 1.5% decrease. If you compare the third quarter of 2015 to the third quarter of 2016, the median price went from $189,000 to $202,000, a 6.9% increase.
If you look at the graph below, you’ll see that from the third to the fourth quarter of 2015, condo prices went up significantly due to tight inventory and high demand. It’s unusual for prices to increase that much during the fourth quarter in Salt Lake County, especially in the condo market, and I’m guessing that won’t be the case again this year, but inventory is pretty tight, so you never know.
The median sold price for a condo/townhouse in Salt Lake City declined from $199,000 to $193,000 from the second to the third quarter of 2016, a 3.0% decrease. If you compare the third quarter of 2015 to the third quarter of 2016, the median sold price went from $167,000 to $193,000, a 15.6% increase, but all the gains came prior to the third quarter.
As you look at the graph below you’ll see that the Median Sold Price of condos in Salt Lake City, increased for three quarter in a row, from the 3rd quarter of 2015 until the second quarter of 2016. That’s unique and I’ve never seen that happen before.
Also, if you look at the third quarter of 2016 on the graph below and compare Sold Homes vs Listed Homes, inventory is currently very tight with 339 condos listed for sale and 321 sold. With inventory this low, Salt Lake City condos could maintain or increase in value moving forward into the fourth quarter this year too. We’ll see.
With the median sold price of a SLC condo at $193,000 and the median price of a single family home in SLC at $309,000, you’d think the more affordable SLC condo market would continue to appreciate.
2017 is right around the corner and it’s hard to know for sure what will happen, but my best guess is the first half of 2017 will be similar to the first half of 2015 and 2016 with the Median Sold Price for homes and condos in Salt Lake going up again.
I base this opinion on the first graph above, Salt Lake County Single Family Home Sales and a few other factors.
- Interest rates are still holding at historical lows with the 30-year conventional mortgage rate in the range of 3.5% to 3.75% and the 15-year conventional rate at 2.75% to 3.0%.
- The August 2016 unemployment rate for Salt Lake County was 3.2%.
- A lot of people put their plans to buy a SLC home or condo on hold this year because it was such a hot market in the spring.
- Regarding the Salt Lake County Single Family Home Sales graph above, if you look at the shape of the graph, slopes of the lines and the actual number of homes listed and sold, and compare the first, second and third quarters of 2016 to 2015, they are very similar.
If housing inventory tightens up in the fourth quarter of 2016 like it did in 2015, and buyer activity and interest rates remain consistent, the median sold price of a home in Salt Lake County should be on the rise again in the spring of 2017.
That’s something to consider if you’re thinking of buying a home or condo in the next year or so. I’m a fan of buying in the fall and winter and selling in the spring. Yes, there are fewer homes to choose from, but if you can find the right property, you’ll usually get a better deal in the fall and winter.
If you have any interest in or questions about buying or selling real estate in and around Salt Lake County, or know someone who does, contact me and we’ll talk.
Realtor Broker MBA CRS
M: (801) 243-0699