Welcome to Summer, enjoy while it lasts, because as you know, they fly by so fast.
We’re half way through 2020 and our local real estate market continues to be one of low housing inventory and multiple offers. Nearly every year, housing inventory builds up, and the market takes a breath before the less competitive fall selling season, but that is not the case this year.
In this month’s SLC Homes News, we’ll take a look at the change in inventory of available single family homes for sale in Salt Lake County, the change in the number of days of inventory of homes for sale, and a comparison of buyer showing activity in 2020 to 2019. Before we get started with that, here are the 2nd quarter 2020 results for Salt Lake County.
2nd Quarter Median Price Change in Salt Lake County:
The median price of a single family home in Salt Lake County increased from $385,000 in the 2nd quarter 2019, to $410,000 in the 2nd quarter of 2020, a 6.5% increase.
I expected it to be more than that, but I think what occurred from looking at the data, is prices flattened out after the COVID-19 stay at home order which started March 17th, and then came back strong later in May and June. In addition to that, there were bidding wars on many homes, and bidding wars can lead to low appraisals.
Single family housing inventory remains low at this time. In the graph below, the green line is homes listed for sale, the black line is homes sold.
There were 4,256 homes listed for sale in the 2nd quarter of 2020, 21.2% fewer than the 5,400 homes listed for sale the same time in 2019.
There were 3,250 homes sold in the 2nd quarter 2020, 14.2% less than the 3,790 homes sold the same time in 2019.
You can see on the graph that both homes listed for sale and sold were significantly lower than in any of the previous five years.
I believe that fewer homes came on the market due to the pandemic. Families have their hands full with kids at home and many people are just playing it safe.
The median price of a condo/townhouse in Salt Lake County increased from $273,000 in the 2nd quarter 2019, to $287,000 in the 2nd quarter of 2020, a 5.1% increase.
If you look at the graph below you’ll see that condo sales have not been as strong as single family homes sales.
The number of condos listed for sale in the 2nd quarter of 2020 is 1,701, which is 9.0% higher than the 1,561 condos listed for sale the same time in 2019.
The number of condos sold in the 2nd quarter 2020 is 1,122, which is 19.5% lower than the 1,393 condos sold the same time in 2019. So the inventory of condos and townhouses in Salt Lake County is increasing with more units for sale and fewer sold.
The condo market is still a seller’s market though, with just 2 to 3 weeks of inventory for condos up to $400,000.
Change in Salt Lake County Single Family Home Inventory (Number of homes for sale):
In the last couple editions of the SLC Homes News, we’ve been comparing the number of homes listed for sale within a price range with a bench mark of March 11, 2020 to inventory levels. The table below takes a snapshot on March 11th, May 20th and July 13th of this year.
| Inventory of Single Family Homes For Sale in Salt Lake County | ||||
| % Increase | ||||
| Price Range | 11-Mar-20 | 4-May-20 | 13-July-20 | 3/11/20 – 7/13/20 |
| $0 to $200k | 0 | 0 | 1 | 0% |
| $200k to $250k | 9 | 22 | 6 | -33% |
| $250k to $300k | 26 | 75 | 34 | 31% |
| $300k to $350k | 48 | 118 | 75 | 56% |
| $350k to $400k | 70 | 133 | 82 | 17% |
| $400k to $500k | 139 | 274 | 183 | 32% |
| $500k to $600k | 113 | 213 | 161 | 42% |
| $600k to $700K | 102 | 149 | 99 | -3% |
| $700k to $800k | 75 | 111 | 94 | 25% |
| $800k to $1,000k | 99 | 127 | 103 | 4% |
| $1,000k to $1,500k | 24 | 85 | 87 | 263% |
| $1,500k to $2,000k | 29 | 41 | 45 | 55% |
| $2,000k and Up | 41 | 36 | 50 | 22% |
| Total | 775 | 1384 | 1020 | 79% |
The data on the table above shows that the number of homes for sale significantly increased in the first 10 weeks after the stay at home order took effect, and then declined again.
There are more homes for sale now than there were in March, but the table below shows that there are fewer days of inventory based on demand.
Change in Salt Lake County Single Family Home Inventory (Measured by number of days of housing inventory available):
The table below compares the number of days of inventory available by price range. The formula for determining this is: (#of Homes For Sale / # of Homes Under Contract) X 30 days = # of Days of Inventory available. The fewer the days, the tighter the inventory.
| Days of Inventory Available for Single Family Homes in Salt Lake County | ||||
| % Increase | ||||
| Price Range | 11-Mar-20 | 4-May-20 | 13-July-20 | 3/11/20 – 7/13/20 |
| $0 to $200k | 0 | 0 | 8 | <><> |
| $200k to $250k | 7 | 17 | 3 | -51% |
| $250k to $300k | 4 | 13 | 5 | +23% |
| $300k to $350k | 8 | 15 | 8 | 0% |
| $350k to $400k | 11 | 18 | 8 | -26% |
| $400k to $500k | 13 | 26 | 10 | -21% |
| $500k to $600k | 23 | 39 | 17 | -24% |
| $600k to $700K | 36 | 55 | 17 | -54% |
| $700k to $800k | 46 | 72 | 31 | -32% |
| $800k to $1,000k | 90 | 112 | 37 | -59% |
| $1,000k to $1,500k | 25 | 134 | 57 | +129% |
| $1,500k to $2,000k | 87 | 176 | 135 | +55% |
| $2,000k and Up | 246 | 1080 | 167 | -32% |
| Total | 18 | 35 | 15 | -19% |
I think this table and the one below tell the story of the market moving forward for at least the next few weeks. It’s a weird world right now, and I’m not going to make any long term predictions, but that said, based on supply and demand, there is actually less inventory now than there was in March of this year, and it was a hot market at that time.
Nearly every price range up to $1,000,000 has less inventory now based on supply and demand for single family homes, than it did on March 11th. There is 8 to 10 days of inventory from $300,000 to $500,000, and 17 days of inventory from $500,000 to $700,000. The $250,000 to $350,000 price range is about the same.
Buyer showing activity:
The graph below compares buyer showings in 2020 to 2019. This graph uses a 7 day moving average with the first week of January being the baseline. The orange line is 2020 and the blue line is 2019.
Buyer showings started to decline after March 11, 2020, then started to increase again on April 8th, then exceeded 2019 activity on May 14th, and have remained ahead of 2019 activity since then. Buyer showings are currently 5.3% above 2019 activity and 47.3% above this year’s pre-pandemic peak of March 11th.
Wrapping Up the Stats:
- There were 4,256 homes listed for sale in the 2nd quarter of 2020, 21.2% fewer than the 5,400 homes listed for sale the same time in 2019.
- There were 3,250 homes sold in the 2nd quarter 2020, 14.2% less than the 3,790 homes sold the same time in 2019.
- There is 8 to 10 days of single family home inventory from $300,000 to $500,000 and 17 days of inventory from $500,000 to $700,000.
- Buyer showing activity in 2020 has exceed 2019 since May 14th.
- Mortgage rates are at record lows with the 30 year mortgage rate is averaging 3.0% and the 15 year rate averaging 2.5%. It’s a good time to refinance!
- The Salt Lake County Unemployment Rate was at 9.4% on May 31, 2020, 2.9% on February 29, 2020, 4.0% March 31, 2020 and 11.2% on April 30, 2020.
- During the Great Recession, Salt Lake County’s unemployment rate peaked at 8.1% from January to June 2010.
I think we will continue to see fewer homes than usual being listed for sale, and many interested buyers in the homes that do come on the market in the near term. As a result, we will continue to see multiple offers on homes that are priced right, especially on homes priced under $500,000.
With the current unemployment rate higher than any time during the Great Recession, there is some concern as time rolls on. However, we do have the advantage of a low inventory situation right now.
During the Great Recession there were more homes for sale, more short sales and foreclosures, much less buyer demand and interest rates were higher.
There are also a lot of people with equity in their homes right now, so if they have to sell, most will be able to do so without a short sale or going into foreclosure.
Please stay vigilant on keeping you, the people you care about, and everyone else safe! I think we all know what we should be doing.
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 coworker or family member that needs help buying or selling, please contact me. Referrals from clients and friends are the highest compliments I receive.
I’ve been a Realtor in Salt Lake since 1999, and absolutely 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@slchomebuyer.com
M: (801) 243-0699
“Providing Representation for Home Buyers & Sellers throughout Salt Lake”
