Utah Market Update - December 2022

What is happening in our market?

Now that is the golden question! To answer that, at Forty One Eleven Real Estate we try to combine the opinions of market researchers, the federal reserve, lenders, investors, and of course our very own boots on the ground.

Justin Hurd & Sara Hiatt are working day-in and day-out with buyers and sellers in the local market. We are seeing a slight softening in prices from when prices skyrocketed earlier this year, but prices have not seemed to dip below where they were this time last year, and in fact most price drops have come in the form of seller’s offering rate buy downs and closing costs for the buyers - which creates an overall more affordable purchase.

As for the analysis experts, two of our top local market researchers from the University of Utah discussed their take on 2023 market predictions during Ivory Homes annual summit.

Jim Wood and Dejan Eskic are both confident Utah’s job market is strong enough to avoid a mass of foreclosures. They both feel that housing demand will continue due to the state’s rapid growth and home shortage. 

They also expect the market will enter a correction period in 2023 due to interest rate hikes and inflation. However, their predictions for that correction have some variations.

Eskic predicts Utah home prices will drop 9% year over year in 2023. “When we look at just how much we’ve peaked earlier this year, I think we’ll start seeing negative year-over-year readings late winter, early spring,” Eskic said. 

Wood said he was a “little bit more optimistic,” predicting minor blips that will stabilize into the green after only a few quarters because buyers will adjust to the changes. Wood is predicting “a couple of quarters” in 2023, with home prices likely the “most vulnerable” in the first and second quarter of the year. “But by the end of the year, we’ll stabilize and we’ll be flat.” 

What we took from this all is that the housing market is cyclical for sure, but in the end real estate holds as an improving asset and a solid investment.