From Deseret News archives:
Will cost of new homes hit a ceiling?
Research firm Metrostudy said 23 percent of total new housing inventory in the first quarter was above $500,000. That compares with just 15 percent of homes priced above the half-million-dollar mark during the same quarter in 2006.
In last year's fourth quarter, 20 percent of new housing inventory was priced above $500,000.
About 27 percent of new homes in the first quarter were priced between $300,000 and $399,000. A year ago during the same period, 22 percent of homes were priced in that range.
"It's definitely more expensive," said Eric Allen, director of Metrostudy Utah, a Houston-based company with offices in West Jordan. "I think some areas have definitely peaked out, and I know builders that have dropped the price on their house. But I also know builders that are still raising prices. It really depends on where the projects are located."
From the fourth quarter to the first quarter, home prices climbed, but not as dramatically as from a year ago, Allen added.
Just 4 percent of total detached new-home inventory in the first quarter was priced from $150,000 to $200,000. No new homes were priced below $150,000.
Duane Padilla, a real estate agent with Coldwell Banker Residential Brokerage in West Jordan, said the high new-home prices are driving homebuyers to look at existing housing inventory.
"Two years ago my clients were buying a lot of new builds," Padilla said. "But that has really trickled off. Most of my clients are looking for $300,000 or down."
E-mail: danderton@desnews.com
