Year-end home sales highest in four years
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Utah home sales in 2011 were the highest they’ve been since 2007, according to a new report from the Utah Association of Realtors. The report indicated that Utah Realtors sold nearly 33,000 homes last year, up from the final tallies in 2010, 2009 and 2008.
Compared to 2010, sales were nearly 9 percent higher, the result of increased homebuyer confidence, affordable home prices and record-low interest rates. Even though sales faltered during the spring, they picked up significantly at the end of the year.
Since July, monthly home sales have recorded double-digit gains compared to the prior year. Including the 9 percent increase from June, statewide sales have been up for seven straight months.
For the year as a whole, sales gains were particularly strong in several counties. Among the more populated areas, sales increases were in the double digits in the following counties: Uintah (up 33 percent), Wasatch (up 21.4 percent), Washington (up 11.9 percent) and Utah (up 10.9 percent).
Among property types, single-family homes had the highest sales increases, up more than 10 percent compared to 1 percent for condos and townhomes.
The trend of rising sales should continue into this year. Pending sales, which measure contracts that have been signed to buy properties, were up more than 11 percent in 2011 compared to 2010.
The year 2011 was also significant because the market began to absorb excess supply. At the end of December, inventory levels were down nearly 24 percent. For the past 10 months, inventory declines have been in the double digits, with levels falling for more than a year. The number of homes on the market has not been this low since March 2007.
The effect of the steep inventory drop was to bring supply and demand more in line. The 20,243 homes listed for sale at the end of December represented a 7.2-month supply of inventory. That’s down more than 31 percent from the 10.5-month level in 2010. Traditionally, a market is balanced between buyers and sellers when the inventory represents a supply of about six months.
Supply was particularly tight in the low price ranges. For homes priced $150,000 and below, the supply of inventory was at 5.9 months. For those in the $150,001 to $200,000 category, supply was at 6.1 months. Supply was also tighter in the single-family segment at 6.9 months compared to 8.9 months for townhomes/condos.
Although most indicators were headed in the right direction at the end of the year, prices still lagged the recovery. For 2011, prices were down about 8 percent compared to 2010. The median sales price of homes sold was $174,900.
The average sales price also declined about 8 percent for the year. The average sales price for all closed transactions was $224,526.
While prices remained weak in 2011, the reduced supply and increased demand suggest that trend will not continue. A new report from Fiserv and Moody’s Analytics this week predicts Utah home prices will have increased by the end of summer, with the state having the seventh-highest appreciation in the country.
The organization says from third quarter 2011 to third quarter 2012, Utah home prices will have increased 1.5 percent. During that same period from 2012 to 2013, Fiserv says values will be up 7.4 percent.
Of course, the forecast varies depending on the area. Fiserv says St. George will have the state’s strongest home price appreciation. By July, prices are expected to increase 4 percent from the previous year. Coming in second is the Logan metro area at 2.3 percent. In Ogden-Clearfield, Provo-Orem and Salt Lake, prices are expected to see slight increases, with no major Utah metro area forecasted to have a price decline.
Consumers can learn more about the housing markets in their own areas by contacting a local Realtor. More real estate statistics are also available at UtahHousingTracker.com.
February 3, 2012 | Share: