We all know that the Salt Lake area real estate market (and the economy at large) is doing better than most areas of the country. Still, some things have slowed considerably.
Some things that have slowed the most:
- New Construction Permits
- The Time it Takes to Sell a Home (Days on the Market)
- The Number of Home Sales for Homes Priced Over $400,000
The good news is that less new construction actually will help slow the supply, which will help equalize the market sooner, meaning a healthier housing market.
Days on the Market
Currently, however, inventory (supply) still substantially exceeds the number of qualified Buyers (demand), which has directly impacted the length of time it takes to sell a home in today's market. That extra time helps Buyers because many Sellers who need to sell get more motivated as more time passes than they originally expected which translates into more and larger price reductions than was seen in the past as well as more success in negotiations for Buyers with excellent credit and no home to sell.
Average Sold Price
Since the Average Sold Price includes sold homes over $400,000, fewer homes selling above that mark actually artificially skews the Average Sold Price downward. (Well, not artificially, but it should be expected to be lower if very few luxury homes are selling relative to a year ago.)
This means the Salt Lake City real estate market isn't as bad off as some news headlines could lead you to believe, unless you are trying to sella home with an over 1/2 a million dollar price tag. You should expect to sell it for substantially less than you could have during the peak of Salt Lake's boom, say, 20% - 50% less. The higher the price a Seller could have commanded during the peak of the boom, the bigger the hit they will need to take to sell that home in today's market. (While it would be highly unlikely to see a home that could have sold for $400,000 at the peak of the boom selling in the $200,000 range, seeing a home that could have been sold for 1.8 Million Dollars during the boom listed at $900,000 today is conceivable.)
Now May Be the Best Time to Buy a Luxury Home in Salt Lake
The good news here is also for buyers who are able to purchase homes over $400,000. Luxury homes and homes over $400,000 are taking the biggest hit (the largest price reductions) in this market. These homes also historically give you the greatest return if you buy them in a down market and then sell during a future boom. Buyers with excellent credit and down payments over 10 or 20% have the greatest leverage in negotiations in today's market because the pool of available Buyers who can close a loan in this price range is also much smaller than normal.
So if you are thinking about buying your dream home, now would be the time to get the best deal, not after the market bounces back.
If you plan on buying your dream home in the Salt Lake City, Utah area, make sure you work with an agent who will negotiate on your behalf and not in the best interest of the Seller. Exclusive Buyer's Agents work only for Buyers in every transaction.
If you have excellent credit, and will be purchasing a $400,000-$1,500,000 home in the Salt Lake City, Utah area in the next 90 days and would like to be represented by a Certified Negotiation Expert and an Exclusive Buyer's Agent (an agent who will work exclusively for you on your side of the transaction), call us at (801) 969-8989 or contact us via the link on this page.
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