The Salt Lake City metro area is among the top housing markets in the U.S. to see the most dramatic yearly declines in home sales and boosts to for-sale inventory since high interest rates have taken a toll on the national market.
That’s according to RE/MAX’s October National Housing Report, which surveyed 53 metro areas across the nation. Of those 53, the report shows the overall number of home sales across the country are down 13.5% compared to last month — and down 30.7% compared to October of last year.
“October revealed a vastly different housing market from one year ago, with 30.7% fewer closings, 36.8% more homes for sale, and the average home taking nearly a week longer to sell, at 35 days on market,” the report states.
As a result, the national median home sales price declined by 0.3% to $399,000 from September’s $400,000. That’s the third straight month of price declines.
“The historic pace and magnitude of interest rate increases have created a reset and softened the housing landscape as intended,” Nick Bailey, president and CEO of RE/MAX, said in a prepared statement. “In these conditions, homebuyers should be able to consider multiple properties instead of fighting over one. For many buyers, it’s less about the actual interest rate right now, and more about affording the down payment and monthly mortgage payments, and whether the property fits their needs.”
Salt Lake City housing market: Where it stands
Of the 53 markets surveyed by RE/MAX, Salt Lake City stands out for multiple metrics. It had the biggest year-over-year decline in closed transactions. It was also among the top five markets with the biggest increase to days on market and months’ supply of inventory.
Utah — and other states in the West including Idaho — were flooded with homebuyers amid the pandemic housing frenzy. Set free by remote work and lured by quality of life opportunities, including abundant outdoor recreation at relatively more affordable price points compared to big cities, many buyers looked to the West. For fast-growing states like Utah and Idaho, that turned an already boiling housing market red hot.
But now, days of low borrowing rates — some months even under 3% — are over as the Federal Reserve continues to battle record inflation with aggressive rate hikes. The result has been a dramatic housing market correction, with areas in the West slowing faster and more dramatic than other markets across the nation.
Drop in sales: Salt Lake City saw the No. 1 biggest decline in home sales, with a 48.3% year-over-year drop in closed transactions, according to RE/MAX. In October, the metro area saw 903 transactions, down from 1,747 a year ago, when Utah’s housing market was sizzling.
Las Vegas was second with a 45.3% year-over-year drop in closed transactions, from 4,005 in October of 2021 to 1,947 in October of this year. San Diego came in third, with a 42% drop. Portland saw a 39.8% decline. Phoenix sales dropped 39.3%.
No metro area had a year-over-year sales percentage increase in October, RE/MAX noted.
Days on market: Salt Lake City was also one of the top five metros to see the biggest year-over-year increase in days on market, according to RE/MAX. Days on market is the number of days between when a home is first listed for sale and when a sales contract is signed.
Nationally, the average days on market for homes sold in October 2022 was 35, up one day from the average in September 2022, and up six days from the average in October 2021.
Salt Lake City ranked No. 4, with the biggest year-over-year increase to days on market, with 41 days in October — up from 23 days in October of 2021. That’s nearly a 77% increase.
Tampa was the metro with the biggest year-over-year change to days on market, with 42 days in October compared to 18 this time last year, an over 130% change. Denver ranked No. 2, with 32 days on market in October, up from 15 in 2021, a nearly 119% increase. Orlando ranked No. 3, with a nearly 102% increase. After Salt Lake City, Las Vegas ranked No. 5, with a 75.5% increase.
Months’ of supply: Salt Lake City has also seen a staggering increase in months’ supply of inventory, ranking No. 2 in the nation for seeing the biggest year-over-year percentage change.
In October, Salt Lake City had 3.9 months of supply, up from 0.7 in 2021. That’s a nearly 425% year over year increase.
Only Raleigh, North Carolina, saw a bigger percentage jump, with 2.9 months supply of inventory in October, up from 0.5% in October of 2021, an over 462% increase.
Bozeman, Montana ranked No. 3, with 5.9 months supply in October, down from 1.2 in 2021, an over 401% increase. Las Vegas ranked No. 4, with a 4.9 months supply in October, up from 1.2 in 2021, a nearly 330% increase. Coeur d’Alene, Idaho, rounded out the top five 4.2 months supply in October, up from 1.1 in 2021, an over 291% increase.