It’s not yet summer, but Utah’s real estate market is hotter than ever.
Utah Realtors sold the most homes they ever have for the month of April and the median sales price rose to a new record high.
The April Utah Association of Realtors housing report shows 4,845 Utah real estate transactions during the month. That’s a 24% increase from April 2020 when sales had dipped because of the pandemic lockdowns that were taking place.
The more than 4,800 sales set a new April record, beating out the previous record of 4,665 set in 2018. This data goes back to 2003.
April’s median sales price also set a record at $425,000. The median increased about 27% and is nearly $90,000 higher than the April 2020 median of $335,300.
With sellers receiving dozens of offers from buyers, most are selling their homes for more than their asking price. In April, sellers received a record average of about 103% of their original list price.
The rising prices are the result of record-low inventory. Demand is far outpacing supply as houses go under contract almost immediately after they are listed.
April inventory fell 64% from last year with only 4,698 available properties at the end of the month. That’s compared to 13,088 in April 2020. In other words, for every three homes that were for sale last year, there’s now only one.
When taking into account supply and demand, there’s less than one month’s worth of housing inventory. This means the market is highly favorable to sellers. A market that is balanced between buyers and sellers typically has about six months of supply.
“First-time buyers in particular are having trouble securing that first home for a multitude of reasons, including not enough affordable properties, competition with cash buyers and properties leaving the market at such a rapid pace,” said Lawrence Yun, chief economist of the National Association of Realtors, in a press release about U.S. existing home sales.
This is also true in Utah where starter homes are in short supply. For example, the inventory of homes priced $300,000 or less fell 70%. In contrast, the inventory above $750,000 only fell 45%.
“The upper-end market is still moving sharply as inventory is more plentiful there,” Yun said.
Over the past 12 months in Utah, sales in the $750,000-and-above category have more than doubled, up nearly 106%. Meanwhile, sales in the $300,000-and-below category have fallen 23%.
Fortunately, Yun said he expects more housing inventory at the end of the year.
“We’ll see more inventory come to the market later this year as further COVID-19 vaccinations are administered and potential home sellers become more comfortable listing and showing their homes,” Yun said. “The falling number of homeowners in mortgage forbearance will also bring about more inventory.”
With more inventory, Yun predicts the rate of home price increases will slow down.
“The additional supply projected for the market should cool down the torrid pace of price appreciation later in the year,” Yun said.
For now, however, homes continue to be snatched up just about as quickly as they are listed. At 21 days, the average number of days on market set a record low in April, according to Utah Association of Realtors data going back to 2006. That’s about half the time it took to sell a home during April last year.
To learn more about housing market conditions in your area and price range, contact a local Realtor. Find one at UtahRealtors.com