Mortgage interest rates fell again last week to 6.15%, the lowest since September of 2022, according to Freddie Mac. Rates are predicted to fall to 5.5% this spring, according to Lawrence Yun, chief economist of the National Association of Realtors®.
“The spread between the 10-year Treasury and the 30-year mortgage rate is exceptionally wide,” Yun told Realtors® earlier this month while visiting Salt Lake City. “If we had a narrowing, or say, a normal spread condition, today’s mortgage rate would be 5.5%.”
Meanwhile, the median single-family home price in Salt Lake County settled at $541,900 in December, 6% lower than the median price in December 2021. It was the first year-over-year price decline since 2011.
From March 2020 through May 2021, the pandemic spurred a home-buying rush. This caused the median single-family home price to jump nearly 60% in Salt Lake County. The median single-family home price peaked in May 2022 at $650,000. Since then, home prices have fallen 17%.
“Home buyers have more negotiating power,” said Rob Ockey, president of the Salt Lake Board of Realtors®. “The good news for sellers is that, despite the recent price declines, a majority of homeowners are sitting on plenty of equity. A large majority of homeowners don’t need to sell. They can step back and wait for the dust to settle. Consequently, the price declines since May 2022 will stabilize by the third quarter of 2023.”
Home-price declines will likely be tempered by a lack of housing. The University of Utah’s Kem C. Gardner Institute estimates that there is a 31,000-unit deficit of new homes in Utah.
“Demand for housing is strong because of net in-migration and population increase,” Ockey continued. “More than one-third (38%) of all active listings on UtahRealEstate.com are under contract, which indicates there is still strong buyer demand in our market.”
In December, the median time a home was on the market was 41 days, up from 9 days a year earlier.
Sales of all housing types fell to 761 units in Salt Lake County, down 50% compared to 1,508 sales in December 2021. Home sales in 2022 in Salt Lake County totaled 13,087, down 26% from 2021; the steepest single-year drop on record (1997 to the present). Prior to 2022, real estate sales had been remarkably consistent for seven years at about 18,000 sales, only diverging in 2020, the pandemic year, when sales jumped to 19,000 units.
About the Salt Lake Board of Realtors®
The Salt Lake Board of Realtors® is the Wasatch Front’s voice of real estate and the No. 1 source for housing market information. The Salt Lake Board of Realtors® is the largest shareholder of UtahRealEstate.com, one of the leading Multiple Listing Services (MLS) in the United States. Since 1917, the Salt Lake Board of Realtors® has been a leader in promoting homeownership and protecting private property rights. The Salt Lake Board of Realtors® empowers its members to better serve the public by providing continuing education, advocacy, and a professional code of ethics.
UtahRealEstate.com is where real estate listings originate, and it is the official property information platform for real estate professionals in the state of Utah. We proudly serve approximately 96% of all Realtors® in the state of Utah, according to T3 Sixty 2021 Real Estate Almanac. UtahRealEstate.com operates one of the largest Multiple Listing Services (MLS) in the United States.