Home sales along the Wasatch Front are continuing to slow slightly as the effects of sizeable price gains and rising interest rates combined to dampen last year’s summer sizzle in residential real estate.
Numbers released Monday show first-quarter 2014 sales of single-family homes eased down 2.4 percent across the five-county metropolitan area centered on Salt Lake City. Sales dropped 4 percent in Salt Lake County, the first time since 2009 that number has dropped in the first three months of the year.
That follows quarterly sales declines in the 5 to 7 percent range as 2013 closed for four of those urban counties — Salt Lake, Weber, Utah and Davis. Overall, home sales along the Wasatch Front reached 4,687 properties for January, February and March, down from 4,801 for the same months in 2013.
Shrinking inventories, meanwhile, are pushing up Wasatch Front housing prices higher, according to the latest report from the Salt Lake Board of Realtors. The first three months of the year saw the median home price jump 9.2 percent in Utah County, to $229,250. Salt Lake County’s median price rose to $245,000, for a 7.2 percent gain. Davis, Weber and Tooele counties all saw similar rises, at 5.4 percent, 5.9 percent and 7.2 percent, respectively.
"Higher home prices have made home buying less affordable," said Angie Domichel Nelden, the board’s president.
While some buyers aren’t finding what they want at the right price, one leading banking official said the slowdown appeared to be a soft landing from high levels of U.S. government stimulus intended to help the economy out of recession.
"The real estate market has normalized,’’ said Jeremy Lowry, senior vice president for residential lending at Zions Bank. "What we really need to do now is build some more housing stock."
The Utah pattern matches similar trends nationally. Sales of existing U.S. homes fell in March to their lowest level since July 2012 as rising prices and a tight inventories of available homes disappointed many would-be buyers.
The National Association of Realtors last week said sales moved down 0.2 percent to a seasonally adjusted annual rate of 4.59 million, the seventh drop in the past eight months.
In what may be another sign of inventory pressure for single-family homes, condominium sales along the Wasatch Front saw a 10.3 percent gain last quarter, with 1,021 condos sold in the five-county region, up from 926 for the same months in 2013.
In Salt Lake County, sales of condos rose 4 percent, with 559 units sold in the first quarter.
And a few neighborhoods in Salt Lake County and elsewhere bucked the drop in single family home sales, the Board of Realtors report shows. Sales went up in some pockets of Salt Lake City, Midvale, Sandy, Taylorsville and Cottonwood Heights, and also did notably well in parts of Farmington in Davis County and Utah County’s Eagle Mountain and Saratoga Springs.
But other key urban areas that had hot markets as recently as last summer saw their first quarter 2014 sales lag . Volumes in Sugar House, the Avenues, Magna, Riverton and South Jordan all declined at double-digit percentages.
The sales slowdown, however, comes against a backdrop of continue recovery in residential markets, at least compared with levels seen in the recent housing crash. Last year marked the highest sales volume along the Wasatch Front in seven years. Confidence is also on the rise.
The regional Zions Bank Utah Consumer Attitude Index, released in late March, rose 2.4 points to 99.2 from February to March, the fifth consecutive month of gains. That put the survey-based was a full 20 points above where it was at the same time in 2013.
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