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SALT LAKE CITY — As the stampede thunders on for housing in the wild West, the Salt Lake City metro area and its top housing competitor, Boise, Idaho, just topped another national list for record-breaking home prices.
Only Boise's red-hot market outpaced Salt Lake City for the largest percentage increase in year-over-year median home sale prices, according to the latest RE/MAX National Housing report released Monday.
"The secret is out about Boise," Callie Williams, an agent with RE/MAX Elite Properties in Boise, said in a prepared statement. "It's a great place to live, raise a family and enjoy the outdoors. Since COVID we've seen a huge influx of buyers relocating to Boise. The pandemic made people rethink their situation, and we quickly ran out of inventory, skyrocketing our prices."
Boise's median sales price swelled 28.8%, from $369,990 in September 2020 to $476,587 in September 2021. The Salt Lake City metro area's median sales price grew from $385,000 to $490,000 in the same time period, a 27.3% increase, according to the report.
Another western market, Phoenix, Arizona, ranked third in the nation, with a median sales price of $411,000 in September, up from $330,000 in September 2020, a 24.5% increase.
The Raleigh-Durham metro area of North Carolina ranked fourth, with a 20.8% increase. Tampa, Florida, placed fifth with a 19.8% increase.
The report comes after a chaotic 2020 threw the national housing market into upheaval amid the COVID-19 pandemic, accelerating housing price increases in already burgeoning western areas like Utah and Idaho. In 2021, those price increases stuck and only grew.
Earlier this month, new research from the University of Utah's Kem C. Gardner Policy Institute also ranked Utah's housing market as one of the hottest in the nation, second only to Idaho. The report, titled the "State of the State's Housing Market," found in the second quarter of 2021, Utah's housing prices increased a staggering 28.3% from 2020, ranking No. 2 in the nation for year-over-year percent increase. Idaho saw a jaw-dropping increase of 37.1%.
With those record-breaking housing price increases, Utah researchers also warned Utah is now facing a "severe imbalance" in its housing market, facing an only escalating affordability crisis with now more than half of Utah's households are unable to afford the state's median-priced home.
For the September rankings, RE/MAX used real estate data in 52 metropolitan areas across the nation, including all residential types. Many of the largest metro areas were represented in the survey, and the company attempted to include at least one metro from each state, according to the report.
Though the median of all 52 metro area's sales prices was down 1.1% compared to August of this year, it was up 12.5% from September 2020. No metro areas saw a year-over-year decrease in median sales prices. Rather, 31 metro areas increased year over year by double-digit percentages, according to the report.
The slight drop from August's sales prices is reflective of the housing market's seasonal norms, as buying winds down heading into colder months and the holiday season. Still, the figures show the national housing market is maintaining "strong momentum," the report states.
"This was the second-most active September for sales in 14 years, trailing only 2020, which was an outlier in many ways," Nick Bailey, president of RE/MAX LLC, said in a prepared statement. "Plus, the expected seasonal drop in sales from August to September was half of what it usually is, indicating that buyers and sellers are still very much on the move.
The pandemic made people rethink their situation, and we quickly ran out of inventory, skyrocketing our prices.
–Callie Williams, a Boise real estate agent
While the nationwide housing market is "solid," Utah in particular "seems to be stronger and perhaps more durable than other markets," said Josh Horner, of RE/MAX in Salt Lake City, pointing to Utah's consistent population growth.
Utah over the past decade has continued to rank as one of the fastest-growing states in the nation, according to the U.S. Census Bureau.
"Couple that with low taxes, a favorable business climate and major projects like the $4 billion airport renovation, a 20,000 acre inland port, and a brand new ski resort on the backside of Deer Valley," Horner said. "Utah currently has a very durable economy and real estate market."
However, while the market remains red-hot, the volume of Salt Lake City metro area home sales are down 14.9%, putting Salt Lake City No. 3 in the nation for markets with the biggest year-over-year decrease in transactions from September 2020 to September 2021. Boise ranked No. 5 in the nation with a 13.6% decrease.
That drop in transactions could indicate some buyers are turning away from what's been a frustrating market, Horner said.
"The number of offers received per property has dropped over the last few months. We believe this drop is due to a segment of buyers who stopped looking for homes at this time because they simply couldn't compete," Horner said.
"Remaining, however, are the buyers who can really compete with cash or high offers, investors and even institutional buyers," he added. "It might be a slightly smaller segment of buyers, but they're the serious ones."
That means prices aren't likely to drop even as the market cools slightly going into the holidays.
"The demand for housing from local Utahns as well as out-of-state buyers remains strong," Horner said. "We've listed and sold 13 homes in the last few months in Sugarhouse and Park City, all of which went under contract in one to 20 days."