News for the 2014 Utah housing market is looking reasonably positive. Unless some sort of dramatic, unforeseen event disturbs the market’s scales, experts predict that the trends of general recovery will slowly continue in Utah and nation-wide. The slow recovery trend experienced by the 2014 Utah housing market first began in 2012. The market trend appeared to follow status quo through 2013 as well. Once again, experts predict that this trend will continue all through 2014 as well. After taking a strong hit during the recession of 2007, the news of recovery is particularly welcome for Utah’s real estate market.
According to the Zillow Home Value Index statistics, the median home value in Utah currently stands at $213,200 (for July 2014). Those figures indicate a 1.5% increase over 2013, with a further 0.5% increase predicted during the following year. The same statistics also show the median price of homes currently listed in Utah at $249,900. This figure stands significantly higher than the median home value for this state. Analyst feel that such a difference is normal and expected in pretty much all areas. As for the median rent for Utah residents, its value currently stands at $995.
Utah low rate of delinquent mortgages (3.8%) serves as another remarkable detail in the statistics provided by the Zillow Home Value Index. The national average of 7.2% sits significantly higher and is almost double Utah’s rate. Delinquent mortgages generally occur as the first step in the foreclosure process. A delinquent mortgage indicates that the home owner failed to make a mortgage payment on time. Utah’s low rate of mortgage delinquency contributes to a stronger and more reliable real estate market.
Utah’s city with the highest median listing price, Sandy, sits at $270.500. Salt Lake City follows Sandy at $236.400, as reported by the Zillow Home Value Index. The fact that Salt Lake City isn’t the city with the highest listing prices surprises many analysts. However, the surprising figures also showcase the state’s strong real estate market.
According to Jim Wood, the director of the University of Utah’s Bureau of Business and Economic Research, the real estate market for Utah appears quite good at the moment. During a lecture he presented at the Housing Forecast Breakfast in early 2014, he stated that the Utah housing market officially recovered after the low points experienced during the recession. Wood also indicated that the state market would continue trending upwards for the time being.
According to Jim Wood, Utah County experienced remarkable growth in employment in the last couple of years. This employment growth has helped to particularly boost home sales in the north end of the county. In contrast, the recovery in Weber County lags well behind other, neighboring counties. Every single-family home sold in Salt Lake County experienced an increase of 5 percent towards the end of 2013. His forecast for this year remains pretty optimistic regarding continued growth trends and their pace.
Just as the Zillow Home Value Index later confirmed, Jim Wood also predicted an increase in the Sandy and West Jordan real estate markets. Even today, these markets continue to increase positively. The Sandy and West Jordan markets reported a 7 percent increase in 2013 and an 11 percent this year. At the onset of 2014, Jim Wood happily announced that the Utah housing market as a whole sat within 10 percent of its all-time high. Except for Weber County, almost all areas continue exhibiting steady growth in real estate and in median home selling prices.
South Salt Lake City experienced the most spectacular growth in its median selling price at the end of 2013 with an increase of 26 percent. On the other hand, South Salt Lake City did not report any kind of growth in real estate in 2012. So, we should consider this percentage with a grain of salt. The positive trend that helped jump start the Utah housing market to the strong shape it’s in today started in the first quarter of 2012 when the market first began recovering from the recession. Since then, the trend continued upwards bolstered by the steady decline in the volume of foreclosures/dubious mortgages with negative equity.
The term of negative equity refers to a type of situation where the owner ends up owing more than he or she actually owns. Jim Woods announced in his forecast at this year’s debut that Utah’s concrete number of ‘underwater’ mortgages has improved markedly along with the increasing home prices. “Two years ago, Utah ranked 13th among all states in the share of mortgages that were underwater, as 1 in 5 mortgages has negative equity.” This phenomenon posed a serious danger to the Utah housing market because underwater mortgages tend to lock the owners into their land and home with a fragile economic situation.
However, the decrease by which these aforementioned troubled mortgages occurred was pretty spectacular. This decrease contributed to today’s strengthened market. By the second quarter of 2013, the percent of all underwater mortgages in Utah dropped to 8, making Utah the number 34th state for underwater mortgages nation-wide. Woods also added that less of these negative equity mortgages would make way for increased housing demand.
As far as factual predictions for the ongoing 2014, researchers stated that the housing prices increase will probably reside within 5 to 7 percent. This figure is a little higher than the historical high of 4 percent. Additionally, we could also expect a 7 percent increase in the sales of single family homes, especially since the drop in underwater mortgages enables people to try to move up in the market.
All of this comes as a continuation of the already positive trends of the past couple of years. “Low interest rates helped sustain the surprising price recovery, and accelerating job growth supported an increase in sales”, Jim Woods added as his closing words. “Now that the recovery has been secured, this year will be marked by a return to normalcy.”
In other words, things are indeed looking pretty good for the 2014 Utah housing market. This is good news for both prospective home owners and for investors which may be tempted to relax a bit when it comes to this real estate area. Hopefully, next year will bring about an even further continuation of the growth trends.