So how’s the housing market doing in Utah?  If you’re a real estate agent in Utah, or probably anywhere in the US right now, you hear this question on a daily basis.  So what’s the answer?

It depends!

If you’re buying, it’s probably a great time to buy.  If you’re selling, it might be a tough time to sell.  If you bought your home a few years ago during the boom, then the market isn’t looking too great at all.  If you’ve been in your home for years and have managed your mortgage, then it’s a good market!

Probably the best way to assess the Utah Housing Market is to look at some data.  The MLS (Multiple Listing Service) data goes back almost 15 years.  Here is a fabulous graph that shows market activity for the past nearly 15 years.  (Click on image for better detail.)

Utah County Home Sales, 1st Quarter Annually

As you can see, our market was gradually growing comfortably for about 8 years.  Then “The Boom” happened.  Housing went out of control as the number of homes sold boomed, and prices boomed.  ”Flipping” homes was the rage, and people could buy a home and fix it and sell it and make a lot of money in just a few months.  Then reality set in, the mortgage market crashed, and it was like a game of hot potato.  Those stuck with the properties got burned.

The news keeps saying that the market is stabilizing, and the graph shows that people are starting to buy homes again.  However, home prices still look like they are coming down, gradually.

My best guess — based solely on this graph, I’d say that if you were to stick a ruler on the dots for the first 8 years of this graph and extend it forward, that’s right about where we should be as far as prices and home sales.  (In business speak, that’s called Multiple Regression Analysis and Projection through Extrapolation!  Thanks UofU MBA School!)  We are still a couple of years away from that ruler meeting where the current trend of housing is going.

Another variable to consider is home prices.  If you look a little further into the data, you will see that there is still high demand for cheaper homes.  What happened is not necessarily that the bottom fell out of the market, but rather the top fell out of the market.  The homes that took the biggest hit were the most expensive homes.  Most people can afford a $100,000 home, so demand is strong there.  When you start getting $600,000 to $1,000,000, there is a much more limited market and fewer buyers.  The top fell out of the market.

In a market of many variables, there are a few constants here in Utah.  Babies are being born every day at the hospitals, and they are going to need homes!

For now, we are obviously in a correction pattern.