Local homes called affordable

Even with double-digit increases in home values in some areas, prices along the Wasatch Front remain within reach for most potential homebuyers, according to mortgage broker Coldwell Banker. In addition, Utah seems to be bucking the trend of increased foreclosures across the nation.

"If all the (nation's) mortgages in the subprime went into foreclosure that were in default, that would be about one percent," said Jaren Davis, vice president of business development for Coldwell Banker Residential Brokerage Utah, speaking to the Deseret Morning News editorial board.

He said despite the national concern over increases in subprime loans and in the number of loans in foreclosure, the problem is not as bad as some analysts make it seem.

"The subprime issue is an issue across the country. Is it here in Utah? It's very minor," said Max Thompson, president of Coldwell Banker Residential Brokerage Utah.

Recently released figures show nationwide the number of foreclosure filings have risen greatly in the wake of the recent lending debacle.

But the Beehive State has managed to avoid the default trend due to its strong economy and stable growth in its housing market," Davis said.

"A person doesn't lose their home to foreclosure in an appreciating market because they have equity," he said. "When markets are appreciating, foreclosures are lower."

Davis added another reason for Utah's lower foreclosure rates is the state's concerted effort to crack down on mortgage fraud. He credited the state for putting safeguards in place to track potential fraud and prevent deceptive mortgage practices.

A recent survey by Coldwell Banker indicated more than half the zip codes in Salt Lake County reported appreciation rates greater than 10 percent in the first and third quarters of 2007 compared to the same time last year. The report also stated the average price of homes remains affordable, with "affordable" defined as homes selling at less than $225,000 in 2007.

"There's still a shortage in the marketplace on the lower-priced homes," said Thompson, noting the average time for homes to be on the market ranges from 35- to 45-days. That time frame could be extended for higher priced homes.

Even with the challenges, he considers the local housing situation stable.

"The market is healthy, the market is strong," Thompson said. While housing sales decreased significantly during the last three months, home prices remained relative constant.

Thompson said he doesn't expect real estate activity to reach the fever pitch of the last year or two but proceed at a healthier level that will allow the market to maintain stability and reasonable growth.

"I see buyers holding off, being prudent and being smart," Thompson said. "Buyers who are cautious will enter the market over the next few months."

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E-mail: jlee@desnews.com