Home-sales numbers released Wednesday indicate that the Wasatch Front's housing bubble has truly begun to burst: 61 of 81 ZIP codes in four counties saw decreases in median home prices during the second quarter of 2008, compared with the same period last year.
The report by the Salt Lake Board of Realtors showed that home sales in the second quarter of this year were down 28 percent, compared with the same quarter a year ago.
In Salt Lake County, the median sales price fell 1.61 percent year-over-year to $249,000. The median sales price in Davis County fell 1.75 percent to $225,000. And in Utah County, the median sales price dropped 4.08 percent to $235,000. Only Weber County saw its median sales price increase year-over-year, rising 4.28 percent to $166,850.
Wells Fargo economist Kelly Matthews said that while home prices have not gone down as far or as fast as analysts had expected, the prices have probably not hit bottom just yet.
"We're only part of the way through the adjustment period," he said. "There has to be still some further price reduction over the remainder of this year."
Late last year, Matthews had predicted that home prices might have to be reduced by as much 15 percent to 20 percent before the market would begin to rebound. But he said Wednesday that the scenario might change, since prices along the Wasatch Front have remained stronger than in many other metro areas nationwide during the housing downturn.
The number of single-family homes sold in Salt Lake County in the second quarter of this year increased 39 percent, compared with the first quarter of this year. Home sales typically are slower during the winter months.
But the second-quarter increase in home sales follows a period of declining home sales that began in the second half of 2007 and resulted in an eight-year low in monthly sales in January, the report said.
"Last year's reckless lending artificially inflated sales," said Jillinda Bowers, president of the Salt Lake Board of Realtors, in a prepared statement. "Finally, we have gotten rid of the rampant speculation and loose lending standards. This year's sales are down compared to last year, but we are cautiously optimistic going forward that home sales will continue to gain momentum as they have since the end of January."
The median sales price of single-family homes sold in Salt Lake County during the second quarter of 2008 increased 3 percent to $249,900, compared with a median sales price of $242,000 during the first three months of the year. However, the median sales price dropped 1.61 percent from the second quarter of 2007.
Among the areas hit hardest by declining prices was Kaysville in Davis County, which saw its median sales price fall 23.2 percent year-over-year to $266,500. In Utah County, the median home sales price in Alpine fell nearly 27 percent from the second quarter of last year to the second quarter of this year.
The areas with the strongest growth were in Weber County. The Marriott/Slaterville ZIP code of 84401 had a median sales-price increase of 52.59 percent year-over-year. Following in a respectable second place was the South Ogden ZIP code of 84403, with a 20.74 percent median sales-price hike.
In Tooele County, sales of single-family homes in the second quarter increased 33 percent in the past year, with the median price of a single-family home up 2 percent to $183,300.In the condominium market, the number of condos sold in Salt Lake County during the second quarter increased 25 percent from the first quarter in 2008. But condominium sales were down 32 percent when compared with the same period last year. Median sales prices for condominiums also declined by about 1 percent year-over-year, to $172,500.