If you haven’t said it out loud, you’ve probably thought it—”What in the world is going on with real estate prices?!” For many, it hints of what happened almost ten years ago before the market crashed. For others, it seems like the natural progression of a booming local economy and, in our case, a highly-sought-after neighborhood.
The fact is, there is some truth to both sentiments. What is happening in the Yalecrest and surrounding real estate market is cause for closer examination. Consider that in the 1st and 2nd quarter of last year (2015) the average home sale price between 1300 East to Foothill Drive and Sunnyside Drive to 1700 South was $469,000. 1st and 2nd quarter averages this year (2016) jumped a whopping 17.42% to $525,000. What does it mean for the future of real estate in our area? I wish I had a glass ball and could tell you our future! Unfortunately I can’t, but we can look at a few relevant statistics, provided by our Multiple Listing Service (MLS) for some worthy updates.
In the real estate world, we like to look at the absorption rate—the number of months it would take to sell the currently listed homes in the market. Our neighborhood is holding a .95 absorption rate or less than a months worth of supply. When the absorption rate is less than 3 we are in a sellers market. Salt Lake County has been hovering around a 2.5 absorption rate.
We expect the real estate market to continue to be strong with prices leveling out through the 3rd quarter and typical seasonal downturn in the 4th quarter. Homes will most likely start sitting longer on the market. But what we are still seeing, is prime inventory that is priced accurately in our area is still moving quickly—very quickly. Two case studies: in the last 30 days I have had two families buy and sell homes at almost breakneck speeds.
The Pugsley family made an offer on a for-sale-by-owner home on Laird Drive two days after the home was on the market. Within a week their own home was on the market and a full-price offer on the table after the first showing.
The Jones family made an offer to buy a home on Princeton before it was listed or a sign on the lawn. Once again, within a week their own home was on the market and sold on the first day with a full-price offer.
Projections seem to indicate real estate levels, including pricing, will remain steady for the next year. One must also consider that the Yalecrest neighborhood, and other well-established Salt Lake City neighborhoods, have historically fared well even during economic downturns. Buyers who prioritize quality of life and desire for little to no commute to downtown, University of Utah/ Research Park or nearby mountains, and want access to top-rated public and private schools, will be willing to pay top dollar for homes in our neighborhood. Even when the market bottomed out in 2007, prices in our neighborhood remained relatively stable.
Regardless of whether we are in a sellers’ market, buyers’ market, or anything in between, we at Yalecrest Homes will continue to serve our clients with exceptional care and expertise. Click here for more information about our curated real estate services.