In last month’s SLC Homes News we looked at the significant appreciation that we’ve seen in our local housing market and I presented the reasons why that’s occurring. At the top of the list of the reasons why was a 5,500 unit shortage of homes and condos for sale in Salt Lake County. As I dug into the inventory stats, I observed some things I’ve never seen before. So let’s get into the inventory story.
On the graph below, the green line tracks the number of single-family homes listed by quarter and the black line tracks the number of homes sold, going back to 2015.
Since 2015, the Salt Lake County housing market has tracked pretty consistently when you look at the number of homes listed and sold by quarter, until the 4th quarter of 2019.
In previous 4th quarters, the number of single-family homes listed and sold were about equal, but in the 4th quarter of 2019, 3,192 homes were sold, and only 2,644 homes were listed to replace them, a deficit of 548 homes.
The 1st quarter of 2020 was pretty typical compared to previous years for both homes listed and homes sold.
Then the pandemic hit in the second half of March, and we all started staying at home, which led some people to change their plans.
During the 2nd quarter of 2020 only 4,278 homes were listed. That’s 1,129 fewer homes than the 5,407 homes listed in the 2nd quarter of 2019.
Then during the 3rd quarter of 2020, the number of homes sold was about equal to the number of new home listings. That might not sound like a big deal, but if you look at the graph below that tracks 3rd quarter data for single-family homes listed and sold in Salt Lake County back to 2004, you’ll see that this has never happened before.
The 3rd quarter is typically a time to restock the shelves after the spring rush. In the five previous 3rd quarters, anywhere from 777 to 1,581 more homes were listed than were sold.
In the 4th quarter of 2020 we saw a repeat of what happened in 2019, with 2,839 homes listed and 3,612 sold. A deficit of 773 homes.
The table below compares the total number of homes listed and sold by year, and shows the percentage of listed homes that were sold.
| Single Family Homes in Salt Lake County: Total Listed & Sold | ||||||
| 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | |
| Homes Listed | 17,697 | 17,393 | 17,337 | 17,076 | 16,118 | 14,765 |
| Homes Sold | 13,422 | 13,669 | 13,395 | 13,181 | 13,170 | 13,588 |
| % Sold/Listed | 75.8% | 78.6% | 77.3% | 77.2% | 81.7% | 92.0% |
The percentage of listed homes that were sold had been in the range of 75.8% to 81.7% until 2020 when 92.0% of all homes listed were sold.
Over the last five years, the number homes listed has declined every year, while the number of homes sold has been pretty consistent.
The Salt Lake Condo and townhouse market was already running pretty hot as you can see from the table below. The percentage of condos sold compared to listed was typical of previous years, with 85.2% of all condos listed selling in 2020, but here we see a trend opposite of single-family homes with the number of condos and townhomes listed increasing every year over the last five years.
| Condos & Townhomes in Salt Lake County: Total Listed & Sold | ||||||
| 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | |
| Condos Listed | 4,729 | 5,146 | 5,321 | 5,566 | 5,291 | 6,007 |
| Condos Sold | 3,717 | 4,192 | 4,395 | 4,716 | 4,680 | 5,117 |
| % Sold/Listed | 78.6% | 81.5% | 82.6% | 84.7% | 88.5% | 85.2% |
This makes sense and I’m guessing that this trend will continue. There is a price point that most of the buyers in the market can afford, and builders will build a product to fill that need. With the cost of construction and land increasing, condos and townhomes are often the affordable option for first time home buyers buying new construction.
Based on all the numbers I just presented, if you thought last year’s real estate market was crazy, hang on, the ride is not over yet.
That said, in a crazy market like this, you need the best representation you can get. I’ve been a Realtor in Salt Lake since 1999, and absolutely love what I do, and I can’t do it without you. I greatly appreciate your referrals and repeat business!
Thank you!
Kev
Kevin Coyle
REALTOR BROKER MBA CRS
SLC Homes
E: Kevin@SLCHomes.com
M: (801) 243-0699
