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Utah housing market shows signs of life

Glimpses of improvement in Utah housing market

Published: Monday, Aug. 3 2015 1:26 p.m. MDT

Allison and Ryan Barclay take a break from the grind of moving on the front step of their new home in Highland.  (Kristin Murphy, Kristin Murphy, Deseret News) Allison and Ryan Barclay take a break from the grind of moving on the front step of their new home in Highland. (Kristin Murphy, Kristin Murphy, Deseret News)

SALT LAKE CITY— Allison Barclay loved her house and neighborhood in Millcreek, but her husband, Ryan's, commute to Orem was wearing on him.

Saturday, the couple and their "little guy," 17-month-old Max, moved in to their new house in Highland. Plans were delayed when the moving truck broke down, but new appliances were delivered in the morning and by late afternoon the house was beginning to look like a home.

"One of the benefits of moving from Salt Lake to Utah County is you can get more for your money," Allison Barclay said.

They successfully negotiated the staging and selling of their old home and moved to the next step up the economic ladder as the housing market continues to rebound and is moving from a buyer's market to a seller's market.

Ryan Barclay and Allison Barclay set up the nursery in their new home in Highland on Saturday, Sept. 15, 2012.  (Kristin Murphy, Kristin Murphy, Deseret News) Ryan Barclay and Allison Barclay set up the nursery in their new home in Highland on Saturday, Sept. 15, 2012. (Kristin Murphy, Kristin Murphy, Deseret News)

In the first seven months of 2012, home sales in Salt Lake County increased 19 percent compared with the same period in 2011. In fact, July marked the fourth consecutive month of rising home prices on a year-over-year basis, according to the Salt Lake Board of Realtors. That hasn't happened since 2007.

Home prices in the Salt Lake area have continued to show signs of increasing as inventory levels of existing homes tighten. The median price of all homes and condominiums sold in July rose 1 percent year over year to $192,000.

The number of homes and condos sold in July in Salt Lake County climbed 16 percent compared with the same month last year. Rising sales and prices have shifted Salt Lake's real estate landscape to more of a seller's market, with more buyers than sellers, the board reported.

Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012.  (Kristin Murphy, Kristin Murphy, Deseret News) Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012. (Kristin Murphy, Kristin Murphy, Deseret News)

Data from the Salt Lake Board of Realtors shows that you would have to go back to 1997 to find fewer listings on the Wasatch Front Multiple Listing Service.

Through the second quarter of the year, 5,300 properties were listed on the service, down significantly from the historic high of 9,851 in 2007. In some cases, there have been multiple offers on properties in highly desirable areas, resulting in higher offers.

"The most active price range within our market is $250,000 and below," said Dave Frederickson, first vice president of the Salt Lake Board of Realtors.

Homes priced at reasonable levels are receiving a lot of attention from prospective buyers, Frederickson said.

"In previous years, prices were overinflated," he said. "Now we're back to reality. On average, we are back to a normal market swinging toward a seller's market. Whereas a year or two ago, we were definitely a buyer's market."

Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012.  (Kristin Murphy, Kristin Murphy, Deseret News) Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012. (Kristin Murphy, Kristin Murphy, Deseret News)

According to the Federal Housing Finance Agency, the Beehive State ranked sixth in percentage change in housing prices for the period ending June 30, with a one-year hike of 7.1 percent in home price appreciation. The national average was roughly 3 percent.

The Federal Housing Finance Agency report also stated that all five of Utah's largest metro areas ranked among the top 120 metropolitan statistical areas nationwide, each showing positive growth in home prices.

The St. George area was the highest ranking Utah metro at No. 12, with a one-year appreciation of 3.75 percent. The Logan area ranked No. 120, with home price appreciation of 0.15 percent for the past year.

Nationally, U.S. house prices rose 1.8 percent from the first quarter to the second quarter of 2012, according to the agency's seasonally adjusted purchase-only house price index. The index is calculated using home sales price information from Fannie Mae and Freddie Mac mortgages.

Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012.  (Kristin Murphy, Kristin Murphy, Deseret News) Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012. (Kristin Murphy, Kristin Murphy, Deseret News)

The Federal Housing Finance Agency purchase-only and all-transactions house price index tracks average house price changes in repeat sales or refinances on the same single-family properties. The purchase-only index is based on more than 6 million repeat sales transactions, while the all-transactions index included more than 46 million repeat transactions.

The index showed seasonally adjusted home prices rose 3 percent year over year from the second quarter of 2011 to the second quarter this year.

"Although some housing markets are still facing significant challenges, house prices were quite strong in most areas in the second quarter," said Andrew Leventis, Federal Housing Finance Agency principal economist. "The strong appreciation may partially reflect fewer homes sold in distress. But declining mortgage rates and a modest supply of homes available for sale likely account for most of the price increase."

Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012.  (Kristin Murphy, Kristin Murphy, Deseret News) Ryan Barclay moves into his new home in Highland on Saturday, Sept. 15, 2012. (Kristin Murphy, Kristin Murphy, Deseret News)

Locally, the Salt Lake area market is beginning to generate positive momentum, analysts said.

Michael Morris, executive vice president for the Real Estate Division at Zions Bank, said housing finance activity — purchases and refinanced properties — is up approximately 30 percent so far this year.

"The surge in the last year has been on refinancing, but the new homebuyer is (also) back," Morris said.

"Homes are more affordable than ever. Rates are at all-time lows. (Most) buyers are more qualified to buy homes than they have been for decades," he said.

In the wake of the recession, the overall market has been stabilized and homes have become much more affordable, even as wages have remained relatively flat, Morris said.

Ryan Barclay, left, and Nate Gygi move a television into the Barclays' new home in Highland. The Barclays moved to Utah County from Millcreek.   (Kristin Murphy, Kristin Murphy, Deseret News) Ryan Barclay, left, and Nate Gygi move a television into the Barclays' new home in Highland. The Barclays moved to Utah County from Millcreek. (Kristin Murphy, Kristin Murphy, Deseret News)

Looking ahead into next year, he said the market is likely to begin a slow increase in home appreciation.

"The foreclosure supply is shrinking. Notices of default are being filed less," Morris said. "And if this rate environment continues for the next year, we'll see increased sales activity in resale homes and new homes at greater levels that we've seen in the past year."

Contributing: McKenzie Romero

Email: jlee@desnews.com Twitter: JasenLee1

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