Utah home prices hit new record even as rates rise

April 21, 2022

Even with sharp increases in mortgage rates, Utah home prices keep going up as properties continue to sell at a rapid pace.

In fact, the median price of Utah homes sold set a record in March, hitting a median of $525,000 for the first time. The median is 29% higher than it was at the same time last year, according to March data from the Utah Association of Realtors.

That equates to a price increase of $119,000 and marks the 120^th consecutive month of statewide year-over-year price gains.

The county with the highest median price is Summit at $1,295,000 followed by Wasatch and Grand at $955,000 and $700,000 respectively. The most affordable counties in Utah are Daggett at $70,000, Carbon at $178,000 and Emery at $186,500.

Nationally, the median sales price is $375,300, marking 121 consecutive months of year-over-year increases. This is the longest-running streak on record.

Counties in Utah with the highest price increases were Cache (up 46.9%), Box Elder (up 41.2%) and Washington (up 31.9%). (Only counties with at least 50 sales were ranked.)

“Home prices have consistently moved upward as supply remains tight,” said Lawrence Yun, chief economist of the National Association of Realtors. “However, sellers should not expect the easy-profit gains and should look for multiple offers to fade as demand continues to subside,” he said.

In Utah, the time it took to sell a house remained low in March, taking an average of 21 days, down from 27 days last year. Homes in the $300,001-to-$500,000 category sold the fastest at 17 days on average.

While homes sold quickly, there were fewer sales than last year due to higher prices, rising interest rates and the continued inadequacy of housing inventory.

Utah Realtors sold 4,054 properties during March, down 10.5% or 475 houses from last year at the same time. Pending sales were down about 11%. Pending sales are properties that are under contract but are not yet finalized.

But not all areas saw a sales decline. Counties with the greatest sales increases were Wasatch (up 13.3%), Iron (up 11.2%) and Cache (up 7.6%).

“The housing market is starting to feel the impact of sharply rising mortgage rates and higher inflation taking a hit on purchasing power,” Yun said. “Still, homes are selling rapidly, and home price gains remain in the double-digits.”

In Utah, affordability fell about 21% from last year. A typical Utah family makes about 81% of what it needs to afford the median-priced home.

Yet, even with the affordability challenges, the low supply and high demand are keeping competition high. Buyers are also using cash to cope with the situation.

“With rising mortgage rates, cash sales made up a larger fraction of transactions, climbing to the highest share since 2014,” Yun said.

The number of homes for sale in Utah remained at near-record lows in March. There were 3,731 properties in active status at the end of the month, which is about the same as March 2021. If no new inventory came on the market, it would take 0.8 months to sell all the homes, which represents a seller’s market.

Moving into the months ahead, the National Association of Realtors expects U.S. sales to decline 10% while price growth slows to 5%.

To learn more about real estate conditions in your own area, contact a Utah Realtor.