Speaker 1:
Should you make the real estate move in 2022? Today, I’m talking about the Utah Housing Market Forecast housing predictions for the Greater Salt Lake City, Utah area, so stay tuned.
Hi, this is Melissa Ballman, and I’m a real estate agent here in the Greater Salt Lake City area. So what that means, if you’re looking at making a real estate move, I’d love to connect with you. Shoot me a text, send me an email, do what you got to do, but get in touch with me. But Salt Lake City is been said to be the number one metro area for housing market forecasts in 2022. So stay tuned and let’s talk about that.
So recently, realtor.com came out and said that the metro area of Salt Lake City is ranked number one for growth in any metro area in the United States for 2022. And they’re expecting growth rates to exceed 15% in 2022 in Salt Lake City, and just over 8.5%, year over year, for home prices. Now, that outpaces even Boise, Idaho, who’s been on the top of the list and growing like crazy in 2021. Now recently, the Salt Lake Board of Realtors had their 2022 Forecast Breakfast. And they get different people to speak at this, and the University of Utah does an analysis. And here’s what they’re actually saying about the forecast. First of all, they’re not expecting a bubble to hit. It’s very unlikely. You get a lot of people saying, “A bubble’s coming, it’s got to burst,” all of that. But really what the problem is, is that we don’t have enough homes to support the population.
If you’ve seen any of the news articles talking about how rapidly the population is projecting to increase over the next 50 years, you’ll see that. Now, back in 2008, when we had the housing bubble and it burst, which is the most recent one that most people go back to, it really didn’t have to do with a supply-demand issue, it had to do with people getting loans that had no business getting loans. They had things like stated income loans where my 20-year-old could walk into a bank and say he made a half a million dollars a year, and just state his income. So that bubble burst was more about lending that shouldn’t have been happening, fraud that was happening with appraisals, things like that. So what we’re seeing right now is very different from what we saw back in the last burst that everybody remembers.
So the housing shortage is just going to continue is what is projected in the housing market forecast. Now, we have another element here that we’re seeing as agents in market right now. And that is, goes with the housing shortage. Builders are slowing down production and not putting things on the market. And what I mean by slowing down production, because of supply chain issues and getting things, they’re having a hard time completing homes. They’re slowing down in the sense that they’re behind schedule because they can’t get flooring to finish, they can’t get cabinets in time, and so I know I have clients that are experiencing this right now with new construction, and one of the builders I just spoke to today, they just pulled four units off the market because they have no idea when cabinets are coming in.
So this is all going to affect home prices, home availability, and that supply-demand problem. Now, the Utah housing market forecast out the University of Utah study that was put out is stating that they expect home prices to increase 10-12% in 2022, so giving us another year of double-digit appreciation, and it’s been that way for several years. For are home buyers, hopefully 2023 will slow down and maybe just be single-digit appreciation or price increases. But that’s a little ways out and really hard to predict at this point. Now, one of the most important things we also cannot forget is interest rates. If you’ve watched any of my videos the last couple months, you’ve heard me talk a lot about interest rates and I’m going to drop that famous video I always talk about, with one of my local lenders, about what to expect with interest rates down, in the description, so check that out. But interest rates are going up.
As inflation goes up, interest rates go up. And in the past month or so, interest rates have climbed 1%, which can make a huge impact on affordability, and what people can pay for a home. So just this week, I got an email from a large bank lender that I work with sometimes, and they were quoting a 3.7% interest rate on a 30-year conforming fixed. My other local lender that I was talking to yesterday was about 3.2%. So they are raising, and we’re anticipating by June, they’re going to go up even more. The Federal Reserve has been talking about interest rates climbing this week as well. Now, all the banks kind of get together and give their idea of what they think interest rates will be. And right now, they’re saying their 2022 prediction, the average between all of the different Freddie, Fannie, all of them, Bank One, whoever, is about 3.55%, is what their expecting in 2022.
So on a weekly basis, I get asked the million-dollar, billion-dollar question, and that is, should I wait to buy until the market slows down, or should I buy in 2022? Now, nobody has a crystal ball. So there are things that happen that are outside anybody’s control that you just can’t predict, that can make the market go crazy. But I’ve said it before, I’ve seen it happen firsthand in San Diego when I lived there, and that was, people kept waiting and priced themselves out of the market, and could not buy for, and this was a family member, it was 10 or 12 years because they were so particular and could only live in a certain area, and would not budge on that. And they priced themselves out of the market and couldn’t buy for almost, like I said, 10 or 12 years, before they could afford to purchase.
So with the appreciation rates predicted for the Utah housing market forecast of 2022, and being double digits, get in the market. That, if I had a crystal ball, that’s what I would say to people, is get in. It’s better to get your foot in the door because, like I said, I’ve seen it happen and don’t price yourself out of the market anymore than you may have already. I hope you enjoyed my video today. If you have any questions, feel free to reach out to me. I’m always here to help. If you haven’t subscribed to my YouTube channel, click the bell below. That way, you’re alerted each week when I drop a new video. But as always, make it a great day.
