Cedar City • New statewide figures from the Utah Association of Realtors show the St. George real estate market, hardest hit by the housing recession in Utah, may be starting to recover.

The numbers show an uptick in home sales and signed contracts in September, the most recent figures available. Housing inventory in the area also fell, another indication that homes are selling.

And a new report from Fiserv and Moody's Analytics predicts home prices in the St. George area will rise by 7.9 percent in the second quarter of 2012 over the same period in 2011. According to the same report, St. George will outperform the country: While U.S. prices are forecasted to fall 3.6 percent by next summer, St. George prices are expected to rise nearly 8 percent during the same period.

The report, based in part on data from the Federal Housing Finance Agency, shows home prices in Washington County, which includes St. George, peaked in the fourth quarter of 2006 and then fell about 41 percent through the second quarter of 2011. The current median price of a home in St. George is about $150,000.

Celia Chen, a senior director at Moody's Analytics, said the agency looks at data from a wide variety of sources, including Fiserv, the National Association of Realtors and RealtyTrac. Fiserv counts deed documents filed with counties when houses are sold.

David Stiff, chief economist for Fiserv, a financial technology and services company that compiles figures for clients on more than 380 housing markets in the country, said St. George was hit hardest in Utah by the housing collapse, with Provo coming in second. St. George was a bubble that grew as investors drove up housing prices in the previous decade. The bubble finally burst in 2008, but prices are expected to stabilize and rise next year.

"There is a large correction going on that will attract investors who want to jump in at lower prices," Stiff said.

Lori Chapman, who has been selling real estate in St. George for 30 years and is president of the Utah Association of Realtors (UAR), said that between 2003 and 2004, the real estate market was "an insane time" in St. George — borrowing was easy, expectations were high and building outpaced demand.

"I was showing people 10 to 15 houses at a time and then it dropped to one or two," she said. "It was hard, crazy times ... people were caught in a frenzy and things were not sustainable because [borrowers] were not doing their research."

But Chapman said 2011 sales through September are up, with 2,744 properties sold compared with 2,465 in 2010.

According to the UAR, the median sales price of a home in Washington County in September was $149,900, down about 3 percent compared with September 2010. The median sales price of a home in neighboring Iron County in September 2011 was $84,900, down about 28 percent from September 2010.

Chapman said this is an ideal time to negotiate a mortgage since interest rates are hovering around 4 percent. "There are many great, great deals out there."

Cindy Campbell, president of the Washington County Board of Realtors, said St. George remains attractive, especially to retirees and second-home buyers, because of its proximity to national parks, recreation opportunities and mild weather.

"St. George is affordable again," said Campbell. "Our median-price homes are in line with incomes. In September alone, sales rose and our inventory decreased along with our notices of defaults and foreclosures."

Neighboring Iron County is also enjoying a rebound. But the numbers should be taken in context. While home sales are up slightly, property values remain depressed. Chris Dahlin, a real estate appraiser and former president of the Iron County Board of Realtors, said more time is needed for financial markets to adjust to supply and demand.

Brian Turmail, a spokesman for the Associated General Contractors of America, said construction in Utah rose 3.9 percent, one of the highest gains in the country. Washington County, which lost 5,200 jobs in the past four years, is included in the upturn.

Turmail said his Arlington, Va.-based agency at one point debated whether to partner with St. George on a recovery program to stimulate construction projects. Ultimately, the project went to Phoenix, he said.

St. George "had a higher percentage of jobs [lost], but Phoenix lost more [jobs]," he said.

mhavnes@sltrib.com —

Is St. George in recovery mode?

New data on the St. George housing market, hardest hit in Utah during the recession, show it may be starting to recover. Among the data cited:

In September, Washington County home sales rose 25 percent compared with the same month last year and are up 11 percent for the year.

Compared with Utah as a whole, Washington County's inventory is being absorbed at a faster rate. The county's supply of inventory is 6.7 months compared with 8.9 months statewide.

The Utah Association of Realtors Housing Affordability Index rose nearly 10 percent to 168. That means the median household income was 168 percent of what is needed to qualify for a median-priced home under prevailing interest rates.

Source: Utah Association of Realtors