UTAH (ABC4) – Despite the recent boom in Utah’s real estate market, new data now shows that home sales in Salt Lake County are actually slowing down, so much that the county has hit a new 10-year low.
According to the Salt Lake Board of Realtors, home sales in Salt Lake County during the month of June 2022 have hit the lowest amount in a decade, falling 27% lower than in June 2021.
Looking at the year, it appears a downward trend has taken hold, with June 2022 marking the 13th consecutive month of falling sales, according to the Salt Lake Board of Realtors.
Experts say high mortgage interest rates and record inflation are to blame for lackluster home sales.
“Unfortunately, the Federal Reserve’s effort to curb inflation is having a negative impact on home buyers, who are backing out of deals or don’t qualify for financing because of higher interest rates,” said Steve Perry, president of the Salt Lake Board of Realtors. “In Salt Lake County, there were 400 fewer home sales this June than in a typical June month. Nationally, 60,000 housing deals were cancelled by buyers because of higher borrowing costs, according to Bloomberg News.”
Salt Lake County wasn’t the only area seeing a drop in sales — “Utah County was down 19%, Davis County saw its sales fall 9%, Tooele County was down 13%, and Weber County was down 15%,” says the Salt Lake Board.
Realtors say the total dollar volume of lost sales fell 15% from $1 billion dollars in June 2021 to $852.6 million in June 2022.
“The median sales price for all housing types sold in June in Salt Lake County increased to $545,000, up 16% from a median price of $470,000 in June 2021,” says the board. “The median single-family home price increased to $628,000, up 14% from $550,000 a year ago.”
Despite the slowing sales, Salt Lake County continues to see an increase of new listings. The county’s inventory has increased 9% from the same time last year with 2,149 listings in June 2022.
According to the latest housing report from RE/MAX, Salt Lake City alone saw a 110% increase in the number of available homes to purchase year-over-year. This marks the largest growth of new inventory in the nation from May 2021 to May 2022.
Yet despite the influx of growth, a new Redfin report shows home sale cancellations in Salt Lake City and across the nation have been spiking since the pandemic began.
“The slowdown in housing-market competition is giving homebuyers room to negotiate, which is one reason more of them are backing out of deals,” said Redfin Deputy Chief Economist Taylor Marr. “Buyers are increasingly keeping rather than waiving inspection and appraisal contingencies. That gives them the flexibility to call the deal off if issues arise during the homebuying process.”
With this new trend, it seems buyers may continue to see home prices drop as the housing market continues on its apparent cooldown.