SALT LAKE CITY (ABC4 News) – New data on housing prices suggest the St. George area became less affordable in the last year. While fast-paced growth has added new jobs and industries, home prices are rising faster than incomes.
To current homeowners, it’s no wonder why St. George has become the nation’s fastest-growing metropolitan area, with sunny weather and scenic views.
“I love St. George, and I’m so glad to be home,” said St. George homeowner Diane Cliff.
But housing affordability has become a more difficult issue.
Cliff currently leases several properties and offers lower rent to those scrambling to find affordable options.
“When I first put a home for lease, there were 30 calls,” Cliff said. “But I’m happy as the homeowner to own at the time that I did invest 7 years ago.”
New data from the real estate website HomeArea and the U.S. Census Bureau report that St. George area housing prices are now five times the median salary.
“It has a lot to do with the price of materials, impact fees, and different fees imposed on builders to prevent them from making entry-level affordability,” said Jack Scott, managing broker of Red Rock Real Estate.
Utah real estate experts say the lending process has become a lot more stringent, making it difficult for people to qualify for a home on a low-income basis, and inventory for entry-level affordable housing is slim.
“Investors are purchasing properties for rentals, property management, and that takes a lot of them right off the shelf for owner occupancy,” said Scott.
Scott says many homeowners are also purchasing a second inexpensive home to use as a long-term rental or Airbnb, creating another challenge for affordable housing.
But Scott said real estate is always cyclical and home prices will eventually stabilize or fall.
“We’re now in a seller’s market. It will shift to a buyer’s market, which will make affordability a little more attainable,” said Scott.
The new reports rank the city 9th in affordability statewide.