Market of the Moment - 3/24/2023:
We currently have 463 active homes under 700k in Salt Lake County. The last time we were this low was May of last year.
Very different factors are contributing to this inventory shortage. Sellers are deciding to stay in their homes longer due to the dissonance between their current mortgage rates (most likely under 4%) and purchasing a new house at a 7% interest rate.
We are seeing the number of weekly price reductions decrease for the third week straight which indicates that sellers are starting to be smarter about their listing price. Our current list to sold price ratio is at 98.4%, meaning that homes are typically selling for 1.6% less than they are listed.
Buyers have acclimated to the new normal when it comes to mortgage rates. Sellers are motivated to "wait and see" given their current low mortgage rates. That can only last so long, people upgrade and downsize for life reasons, not for mortgage rate reasons.
When I speak with clients and friends about the market, I keep asking the same question, "Do you think in the long term, say 10 years, Utah's market is going to go up or down?" I've yet to have a person tell me that they think the market will be worse in 10 years.
So if you believe real estate is going to go up in the long term, do you think the extra interest you are paying now will be more than the appreciation you get by owning a home for 10 years?
Homes are a necessity and a long term investment. Funny how people seem to forget that when we aren't having double-digit appreciation year over year.
It is still a great time to buy and invest in real estate. Don't let the short term costs rob you of the long-term benefits.
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