Salt Lake City's real estate market is slowing down, slightly
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With pending home sales dropping year over year, Salt Lake City's real estate market is showing early signs of slowing down. But, home prices are still up about 23% from May 2021.
Why it matters: We keep hearing about a market crash, but so far local data don't support that claim.
Yes, but: Monthly data show early signs of a cooler market, even if it's slight.
What's happening: From May 2021 to May 2022, pending sales were down 7.8%.
- More buyers are holding off as home ownership becomes too expensive. This comes after average mortgage rates surpassed 5% for the first time in 10 years.
- More sellers are dropping their asking price. There was a 22 percentage point increase in price reductions year-over-year in June, according to Redfin.
- Meanwhile, there was a 9.7 percentage point decrease in homes sold for over asking price, per Redfin.
Zoom out: Mortgage applications nationally were down 24%, and 6.5% of sellers on average dropped their asking price each week in June, per Redfin's latest market update.
- In June, national pending home sales were down 13% from this time last year, the largest decline since May 2020, according to Redfin's report.
Be smart: Inventory overall is still critically low, which continues to push home prices up.
What we're watching: New listings and pending sales. If more listings flood the market this summer and buyers don't bite, that's when we would start to see more power shift into buyers' hands.
Bottom line: We're not seeing major changes in Salt Lake City just yet, but we're starting to see early signs of a slowing market.