Previously Issued SLC Homes News on Thursday October 8, 2020:
This year reminds me of the movie The Perfect Storm, and I’m not talking about COVID or our Labor Day weekend wind storm, as much devestation as they have caused. Everything has aligned in Salt Lake County to create the lowest level of housing inventory I’ve seen in twenty-one years in the business, and this has been the case all year.
This has resulted in a median single family home price in Salt Lake County of $430,000 at the end of the 3rd quarter 2020, an 11.4% increase from $386,000 at the end of the 3rd quarter 2019. The median price of condos and townhomes in Salt Lake County was $304,000 at the end of the 3rd quarter 2020, a 10.5% increase from $275,000 at the end of the 3rd quarter 2019.
The only time in the last 10 years when the 3rd quarter single family home appreciation was greater than now, was at the beginning of our housing recovery. During that time the market had been declining for about four years and the median price increased 16.9% from $218,000 at the end of the 3rd quarter 2012 to $255,000 at the end of 3rd quarter 2013.
The graph below shows the median Salt Lake County single family home price by quarter, back to the 1st quarter of 2015. The median price just increased for 3 consecutive quarters in a row, from the 4th quarter of 2019 to the 3rd quarter of 2020. This is rare, usually the market sees the majority of it’s appreciating during the 2nd quarter and sometimes it will increase during both the 1st and 2nd quarters, but then it flattens in the 3rd and 4th.
Only once since the housing market started to recover in 2012 have we seen this, and that was at the very beginning of the recovery, when the market increased from $190,000 at the end of the 1st quarter of 2012, and continued for six consecutive quarters up to a median price of $255,000 at the end of the 3rd quarter 2013. After that the market flattened until the 2nd quarter of 2015.
I mentioned earlier that housing inventory is at record low levels at this time and has been all year. On the graph below, the green line is homes listed for sale, the black line is homes sold, and the blue line is median sold price.
As you can see, the number of homes sold and the number homes listed are almost equal in the 3rd quarter of 2020, and the fact that this has not happened in the last ten years makes me think our local real estate market will most likely run hot through the winter and into next year.
There are a lot of other factors to support this. There are still multiple offers on nearly every home that’s priced right from what I am experiencing and hearing from my colleagues, and it’s not just on the homes under $500,000. Interest rates are still at all time historical lows with the average 30 year mortgage at 2.9%. COVID-19 is causing many people to delay selling their homes, and it will probably be many months before we have a vaccine. Unemployment in Salt Lake County spiked at 11.2% in April 2020 and was back down to 4.7% by August. We’re into October and the traditional holiday slow down from Thanksgiving to the New Year, where people don’t tend to list their homes for sale, is just a month away. There is also pent up demand from buyers who have been looking for a while that still want to get into a home.
This is our “Perfect Salt Lake County Residential Real Estate Storm”, I’ve never seen anything like this.
If you haven’t refinanced yet, your interest rate is above 3.5% and there are many years remaining on your loan, now would be a good time to look into that. Please contact me if you need a referral for a reputable lender.
If you have any questions about buying or selling real estate in and around Salt Lake County, wonder what your home is worth, or have a friend, neighbor, coworker or family member that needs help buying or selling, please contact me. Over 94% of the people I help are repeat customers and referrals from the people I know. I love what I do, and I can’t do it without you!
Thank you!
Kev
Kevin Coyle
REALTOR BROKER MBA CRS
SLC Homes
E: Kevin@SLCHomes.com
M: (801) 243-0699
