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'Bidding wars are over'; Utah home sales plummet as rates rise

Posted at 11:19 AM, Sep 22, 2022
and last updated 2022-09-22 15:36:11-04

SALT LAKE CITY — Utah is not immune from the sagging housing market, with the state seeing a stunning 27 percent drop in sales over the same period in August 2021.

According to the latest report from the Salt Lake Board of Realtors, just 1,204 homes of all types were sold in Utah in August. In addition, active listings in the state now top 10,000 homes, which is a 150% increase over the same time last year.

“The bidding wars are over,” said Steve Perry, president of the Salt Lake Board of Realtors. “Offers above asking price and waiving of appraisals have ended. Home buyers have more choices and options when purchasing a house.”

The slow down stems from rising interest rates which are keeping buyers from financing. Earlier this week, the Federal Reserve raised rates by .75 of a point, putting mortgage rates at a 14-year high of 6.3 percent.

“The Federal Reserve’s aggressive rate hikes seem to be having little effect on inflation, but a chilling effect on the housing market,” said Perry. “We are selling about 400 fewer homes a month than the 10-year average.”

While sales are down, prices remain higher than they were a year ago in Utah. The reported price of a single-family median home in August was $601,000, up 10 percent from 2021. But even those numbers are falling as the price of single-family homes in Salt Lake County are down 8 percent from their peak of $650,000 in May.

A few months ago, buyers had to jump on a house almost immediately after it was put up for sale, but in August, homes stayed on the market an average of 22 days, more than three times longer than 12 months ago.