Utah’s housing market may be cooling slightly, but buyers still face lots of competition as for-sale houses remain in high demand and short supply.
That’s according to a new report from the Utah Association of Realtors that shows a 17% drop in August sales and a 23% decline in the inventory of active listings.
Utah Realtors sold 5,020 homes in August, down from 6,044 transactions last year. The lack of affordable housing choices as well as the pandemic-induced spike in home sales last August help explain the double-digit drop.
Sales next month may also follow a similar pattern. Pending sales, which are contracts signed to buy properties, fell 21%. Because signed contracts often turn into sales a month or two later, pending sales can help predict the direction of future housing activity.
“The market may be starting to cool slightly, but at the moment there is not enough supply to match the demand from would-be buyers,” said Lawrence Yun, chief economist of the National Association of Realtors, in a press release about U.S. pending home sales. “That said, inventory is slowly increasing and home shoppers should begin to see more options in the coming months.”
Should inventory increase, that would be good news for home buyers who continue to have limited housing choices in this Utah market.
At the end of August, the number of homes for sale statewide remained well below what is typically available this time of year. Inventory fell nearly 23% to 5,679 properties actively for sale. That’s compared to 7,361 last year and 12,642 in 2019.
In what could be a sign of improvement, the 23% decline is not as large as drops seen earlier this year when inventory was down more than 60% some months.
The properties for sale represent a housing supply of 1.2 months. Even though the number has ticked up in recent months — up from less than one month earlier this year — the market remains extremely competitive.
As reference, six months of supply is typically a balanced market. Less than six months is a seller’s market; more than six months is a buyer’s market.
Using that measure, the hottest housing market is Davis County with 0.8 months of supply followed by Cache (1 month), Weber (1 month) and Salt Lake (1 month).
“Homes listed for sale are still garnering great interest, but the multiple, frenzied offers — sometimes double-digit bids on one property — have dissipated in most regions,” Yun said. “Even in a somewhat calmer market, a number of potential buyers are still choosing to waive appraisals and inspections.”
The demand for housing has kept pressure on home prices. The Utah median sales price increased 26% in August to $455,000. That ties the record set in July for the highest statewide median. It is also the 113th consecutive month of year-over-year gains.
Among counties with at least 50 sales, the median sales price increased the most in Tooele County, up 38% to $435,000. Cache County followed with an increase of 33% to $370,000, and the Washington County median rose 32% to $495,000.
Summit County has Utah’s highest median price at $1,100,000, followed by Morgan County at $900,000 and Wasatch County at $808,570.
The housing market continues to move quickly. In August, the average time it took to sell a home was 18 days. That’s down from 39 days last year and 42 in 2019. It’s also close to the record low of 17 days set in July.
To learn about the specific market conditions in your own area, contact a local Realtor. Find one at UtahRealtors.com.