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Jed Boal ReportingThe record housing boom is over nationally and some market analysts expect it to bottom out in the middle of the next year. Here in Utah, we may dodge the downtrend, while the market will not continue red hot.
Home prices soared in recent years. Sellers and speculators made a lot of money, but upward the trend is long-gone nationally, and slowing here in Utah.
For several years, home sales and home building boomed. Home prices appreciated 10, 20, 30 percent, even more in many markets across the country and here in Utah. The CEO of the National Association of Homebuilders, in town for an annual meeting, says the boom was bound to end.
Jerry Howard, C.E.O. National Association: "The housing markets had been way overheated. We've been saying for a couple of years it could not be sustained. So this is a cooling down period that will bring us to more sustainable levels."
Record housing starts and sales were unsustainable demographically; there just weren't enough buyers who could pay those prices. The demand was partly fueled by investors and speculators who wanted to make a quick profit, and spurred on by a surge of unconventional Adjustable Rate Mortgages, but those mortgages are less attractive today.
Some markets, like Salt Lake City, never soared so high and won't cool so quickly.
Jerry Howard, C.E.O. National Association: "It doesn't look like Utah is going to come down at all. We're predicting roughly the same prices we saw for the last two years, predicting roughly the same number of housing starts. Good news for the Utah housing industry, and good news for the Utah economy as a whole."
Home price appreciation should flatten out with big gains for the sellers tapering off. Double-digit gains will diminish for speculators, but long-term homeowners will benefit.
Jerry Howard, C.E.O. National Association: "It's going to be nice, consistent gains in more reasonable terms. That's why Utah is doing well and why we've seen a downturn in overheated markets."
So, the Utah market may not sizzle as hot as Las Vegas, Miami, or Phoenix, but the slow, steady gains are better for most homeowners.
