SALT LAKE CITY (ABC4) – Utah’s housing prices have increased at a faster rate than the national average since 2000.
A house that would have cost $190,000 in 2000 now costs $560,000, which is about a 200% increase. However, the national average has gone up 150%, said Matt Brannon, a data writer for Clever Real Estate. He has worked on several different studies about the housing crisis in the United States.
“It’s not that Utah is vastly outpacing the nation, but it is one of the ten fastest-growing metro areas in the U.S. High and demand has a lot to do with it, [as well as] not meeting supply,” Brannon said.
The U.S. Census Bureau said that St. George has a 5.1% growth, recorded in July 2020 and July 2021. Provo-Orem was in 8th; Logan was in 10th.
Many areas were struggling with housing supply, and that need is exacerbated by investment companies coming in and buying large portions of homes, especially single-family homes.
“It lowers the available pool for people to buy from. This outlet cited that about 27% of home sales in Utah in 2021 were associated with investors. It’s something that makes buying a home that much harder for the next generation,” Brannon said.
A fact that’s becoming increasingly difficult since fewer starter homes are being constructed. In the 1980s, 40% of homes were starter homes. Now that number is just 7%.
“People aren’t building starter homes anymore. There just isn’t enough money in them,” Brannon said.
The pandemic only made the situation harder for homebuyers, said Brannon. Two years ago, the median home cost $330,000, and now it’s $455,000.
“That’s more than a $100,000 increase,” Brannon said.
However, Brannon doesn’t think building your own home is necessarily a good idea either, despite some potential homeowners already exploring that avenue.
“We did a study, too, on that last year. We still found that 66% of people who bought new construction homes had regrets, and 26% said that they would have rather bought existing homes. 90% said they had delays and 90% said it ended up being more expensive,” Brannon said.
In 2020, the share of homes being built across the country was at an all-time low in the nation’s history since the figures were tracked in the 1960s. It’s because building became harder, the cost of lumber sky-rocketed and the supply chain demands were too complicated. Brannon doesn’t think there’s an easy-fix solution.
“It’s going to take a lot of attention from government officials and other stakeholders to really be a little more deliberate in terms of tackling this issue because it’s not getting any easier. And it’s making things harder for everyday Americans,” Brannon said.