Utah’s home real estate market flourished this past year due to record-low interest rates, government stimulus packages, and an influx of big-city escapees moving to Utah to take advantage of a work-from-anywhere lifestyle mixed with outdoor recreation and, for them, affordable housing.
“We have just witnessed one of the biggest run-ups in appreciation and values that we’ve ever seen in history,” says Ben Pack, Mortgage Division President at Altabank™, the largest community bank in Utah.
Home mortgage experts like Pack and his team know first-hand what it’s like to be on the front lines of Utah’s real estate flurry. “We already had a shortage of housing to begin with, but a very recent report that I just read showed that we are short over 44,000 units right now.”
The current outlook for Utah’s residential market
Utah’s housing market continues to be strong. “Overall, the market’s awesome,” Pack says. “Rates are low. People can afford more house. And for folks that aren’t moving, we’ve seen a lot of them refinance over this last year. We see a lot of them right now realizing, ‘Oh, my goodness, I am sitting on so much equity. I’m not going to be able to build the home of my dreams, so let’s remodel the kitchen.’”
Utah mortgage lenders broke records in 2020. Today, low rates and high demand continue to offer investors, home builders, and homeowners a number of financial options. “People are refinancing, tapping into the equity that they have, and they’re building their dream house in their current home right now,” Pack adds. “There’s a lot of stuff happening: purchases, refinances, cash-out, construction. It’s all there, and it’s all good. It’s very healthy for our economy.”
Where in Utah is seeing the most activity?
With a home shortage of 44,000 units, buyers are seeking real estate throughout the entire state—from St. George to Cache Valley. “There’s no single-focused hotspot right now in this state. It’s really everywhere… [There’s] a lot now going out west,” explains Stan Sorensen, Altabanking podcast host, and Altabank’s CMO.
Townhouses are rising throughout Salt Lake County. Large homes are breaking ground in St. George. Silicon Slopes is attracting growth in Utah County. Even Tooele is getting in on the real estate action, according to Pack. “It’s crazy to see the growth in Utah County, in the southern part of Salt Lake County, the western part of Salt Lake County, even Tooele. Tooele is exploding out there. We work with a couple of builders out there, and the demand at their open houses [is so high that] their homes are flying off the shelves.”
Is now a good time to buy, build, sell, refinance or take out a HELOC?
Pack says, yes. As building supply chains catch up and lumber prices recover from pandemic-panic levels, now’s a great time to take out a home equity line of credit or a mortgage. ”We have an extremely strong housing market that’s not going to change. If people are asking themselves the question: Do we wait for the market to drop? I would not wait. There is too much demand in Utah. Get in now. Take advantage of the appreciation that is still going to happen.”
Inflation and interest hikes could be on the way, adding an additional perk to investing sooner than later. “There’s a lot of unknowns,” he adds. “What we do know is rates can’t stay down as low as they are long term. We know that at some point interest rates have to go up, we’ve already seen inflation increase and pretty quickly.”
Four strategies to help you capitalize on Utah’s strong housing market
Many home investors—first-timers, veterans, new builders, renovators, conventional loan bankers, jumbo loan seekers, refinancers or HELOC shoppers—can take advantage of Utah’s appealing mortgage market. Need to fast-track a home mortgage? Pack recommends taking these steps:
Get pre-approved
“Before you even start looking at homes, get in [to a mortgage lender], get your credit pulled, get pre-approved. That puts you in a really strong position,” Pack advises. Online banking tools such as the Altabank app can ease stress.
Know your credit
Owning good credit maximizes your investment. A low credit score, however, needs time to be repaired. “The higher the credit score, the better the rate. The lower the credit score, the higher the risk,” Pack says. “If there’s a challenge on credit, take the time to get it fixed.”
Use an experienced real estate agent
Get a leg up on the competition with an experienced real estate agent, whether you’re a buyer or seller. Pack recommends partnering with “somebody who knows how to negotiate, how to assess true value, what to look for in a house, and has a network of home inspectors.”
Be smart, be comfortable
Don’t overextend your pocketbook. Identifying what you can afford to live comfortably leads to a better outcome—both for your investment and your lifestyle. Pack reminds his own Altabank™ customers to allot money for insurance, utilities, and HOA costs, if applicable.
Altabank. Member FDIC. Equal Housing Lender.