Median home prices in Salt Lake Area are expected to increase further this year, which means that you should probably look for properties beyond the region if high prices are your main concern.
For instance,a residential property for sale in Daybreak or other places in South Jordan are some of the good alternatives. Prices in these areas may not be as expensive as buying a house in Salt Lake City, but it’s close enough to different establishments and facilities. As 2018 marked a time of rising home prices in Utah, home buyers should expect the cost of an average house in Salt Lake County to reach more than $355,000.
High Prices, Low Interest Rates
A Salt Lake Board of Realtors-commissioned report showed that home prices in the county have risen by 80% since 2005. While prices have become steep, most people somehow did not realize the impact on their budget due to the low mortgage interest rates. Hence, buyers have been able to acquire houses that would otherwise be too expensive for them.
Still, the increase in housing prices could reflect bigger mortgage payments. In 2018, the monthly payment for an average house rose by 55% to $2,014 from $1,299 in 2013, according to the report. A projected decline in salaries would not be helpful either, so picking a home in a suburban area in Utah should be a better option.
Seller’s Market
High prices often indicate that it is a seller’s market, but only if sales are also increasing at the same time. The report noted that sales of stand-alone houses will just reach 12,000 units in Salt Lake area. The good news, however, involves an up to 7% increase in median prices amounting to $375,000.
Despite this, Salt Lake City and the rest of the state remains more affordable than other places in the U.S. These include certain cities in California, Florida and Oregon, where people spend over 28% of their income to cover the cost of living.
Unaffordable Cities
Buying a median-priced house in Santa Cruz, California, would cost you around $895,800 this year. If you can afford one, be prepared to spend more than $1,800 for monthly housing expenses. Those who earn an average household income over $73,000 will spend 30% of it on housing alone.
In Miami, the median home price is much lower at $385,100 yet the median household income is also smaller at around $51,800. Residents spend 29.7% of their income on housing expenses. Those who live in Grants Pass, Oregon, spend 27.1% of their income on housing. The average home price in the city costs $334,600, while monthly housing expenses cost $918. When you compare that against a $40,705 median income, it doesn’t seem economical.
Conclusion
Home buyers are better off looking for properties outside major urban areas, while property owners should consult a management company to improve their chances of a sale. It may be a good time to sell because of higher prices, but many will be reluctant to buy for the same reason.