2022 President, Northern Wasatch Association of Realtors
After two years of a white-hot real estate market, home buyers are finally getting some much-needed relief as conditions return to normal.
Even though interest rates have gone up, house-hunters will find many other conditions have moved in their favor. Here are three advantages buyers have in today’s market that they didn’t have only a few months ago:
More houses to choose from
After several years of record-low housing inventory, the number of homes for sale is finally growing. In fact, the number of homes for sale in Weber and Davis counties more than doubled in June compared to one year ago, up 151% and 162% respectively.
More people also put their homes of up for sale compared to last year. New listings increased nearly 11% in Weber County, about 20% in Davis County and 29% in Morgan County.
The result is today’s house-hunters have greater housing selection compared to last year when housing inventory was at near-record lows.
A new Salt Lake Board of Realtors report also found Utah’s housing shortage is improving. Because home-building activity exceeded household formation, the statewide cumulative housing shortage now stands at 31,000 units versus 56,000 in 2017.
These inventory improvements are welcome news to home buyers who are now seeing a greater selection of properties.
More time to make decisions and greater negotiating power
The recent cooling in real estate activity is giving buyers more time to shop. Rather than submitting an offer hours after a property goes up for sale, buyers may be able to wait a few days.
This means you have time to look at several houses before deciding your favorite. The risk of losing the home to another buyer is significantly less than it was only a few months ago.
That’s because homes are spending more time on the market. In Weber County, homes averaged 19 days to sell versus 15 days last year. The average time to sell a house in Davis County also increased to 17 days from 10 last year. Morgan County increased to 27 days from 20.
As it takes longer to sell a home, buyers are seeing some flexibility on price. While June home prices were still on the rise, there are signs the increases are getting smaller.
The median sales price in Weber County increased about 17% in June compared to May’s increase of 19%. Davis County prices were up 16% in June versus May’s 21% gain.
The data also show Northern Utah sellers are receiving closer to asking price versus over asking price as had been common.
More protection for earnest money
The days of non-refundable earnest money appear to be over. And that’s good news.
Over the past two years, many buyers resorted to using this tactic to get sellers to accept their offer. Problem was the buyer couldn’t back out without losing their deposit if they found problems with the home.
In today’s market, sellers are more likely to accept offers that are contingent on inspections, appraisals and financing. That means if you don’t like what you find in the home inspection report, if the appraised value is less than the price you offered or if you can’t secure financing, you can back out and get your earnest money back.
Before submitting a real estate offer, make sure you understand when you can cancel and under what circumstances you can get a refund. To learn more about the changes in the real estate market and current conditions in your neighborhood, contact a local Northern Wasatch Realtor. Find one who specializes in your area by searching the online directory at NWAOR.com.