Cache Valley/Logan Utah Real Estate Market 3rd Quarter 2018

The Cache Valley Utah real estate market remains strong.  The number of homes sold 3rd quarter 2018 was up 3% over 2017 at 470 homes – even with the prices 13.5% higher than last year at this time and interest rates rising.  The past 3 months our home inventory has hovered between 315-325, and currently the average sold price per foot is $114 (remember this is an average – as I’ve mentioned before, pricing varies wildly depending on type of home, age and condition). The average home sale price in Cache Valley is now $262,000.

To put these prices in perspective, the average price per foot in the state of Utah is over $150, and the average home price in Utah has exceeded $350,000 (33% higher than Cache Valley)!  Compared to much of our state, our real estate market is very reasonable.  The state, and our local valley continues to attract new residents with great scores on job growth, outdoor recreation opportunities and excellent quality of life (seasonal air quality excluded).

Despite the strong Utah economy, a market adjustment is anticipated.  As the mortgage interest rates increase, buyers who need to obtain mortgages (most buyers are in this category) find their budgets decrease.  Likely we will see this decreased purchasing power affecting the acceleration of prices and modifying the current sellers’ market to a more balanced market again.  Locally we’re seeing a dual market developing, with homes appropriately priced under $250,000 moving like wildfire, but the higher priced homes – over $350,000 sitting on the market a longer time as they compete with the many new construction options and the increased inventory.  Historically, a yearly real estate market appreciation is around 4 – 4.5% – not the 12-13% appreciation we have seen the past 3 years.  In Utah in general, experts predict a continued appreciation, but at a more normal 6-7% increase next year.

 

 

 

Logan/Cache Valley Real Estate update 1st Quarter 2018

Predictions that the Utah Real Estate Market – and our local Logan/Cache Valley market- would see prices increase at a lower, more historical rate in 2018 have proven incorrect.  The demand for Real Estate continues to match or exceed the supply; even with the added inventory of new homes and townhouses.

While the average median home sold price dropped from $229,000 last quarter to $221,000 the first quarter of 2018, the average sold price per foot increased from $104 per foot to an average $109 per foot – an increase of 5% in just 3 months!  Please keep in mind the price per foot a home fetches depends on the age, style and condition… it can range from $70 or less per foot for an 80 year-old bungalow with an unfinished basement and no updates on a tiny lot to $200 + per foot for a single level rambler with stellar finishes on acreage.  Appraisals are still very important, and your Realtor will pull sold comps to give you an accurate idea of how your home should be priced.

The decrease in median sold price is reflective of the demand for less expensive homes.  There is a proportionally high number of buyers seeking homes priced lower than $300,000.  Of the 241 homes that sold in Cache Valley the past 3 months, 204 (85%) of them were priced under $300,000 and only 9 were priced above $400,000.  This brought the median hold sold price down.  This statistic will change next quarter though, because 21 homes priced above $400,000 are under contract.

Currently there are 204 homes active on the market in Cache Valley.  There are also 204 homes under contract- poised to close in the next 45 days or so.  This illustrates the high demand for Cache Valley Real Estate!  People from other states continue to flood into our Valley – as a result of better job opportunities, lower price of living and better quality of life than afforded in many other places.  It may not be perfect, but it’s close enough to perfect for me – and apparently many others.

If you’ve been thinking about it, NOW is a perfect time to “move up” in home size/price. The demand for homes in the lower price ranges is extreme – with town houses being especially attractive to many young people, but there are more homes available to purchase in the above $300,000 price range (62% of the homes on the market are priced above $300,000).  The mortgage interest rates are still in the “affordable” range, though they have gone from just under 4% at the end of 2017 to 4.5% currently on a fixed 30 year conventional mortgage.  Rates are expected to continue rising over the year with projections of 5% by the end of 2018. On a $200,000 loan, a 1/2% interest increase raises the monthly payment by $60 per month – so timing is important on a purchase if financing is required.

Please call or e-mail if you want specific Real Estate information pertaining to the Logan/Cache Valley area, or if you want a price evaluation on your home.

Happy Spring!

Terri Sizemore/Youngblood Real Estate

435-770-9407 supersizemore58@gmail.com

 

 

Logan/Cache Valley Real Estate…Is there “Bubble Trouble” ?

November sky

Real Estate in Cache Valley has been booming the past 2 + years, with prices rising over 11% per year since 2015, home inventory at record lows, and new homes popping up along ridges and through fields like prairie dog towns all over the valley.  I’ve been overjoyed for my sellers, but a little nervous for my buyers – wondering if we’re on the edge of a bubble – concerned that the market might take a down-turn and buyers be left in a depreciating market such as that we experienced 2008-2012.  Here is where the research took me.

Economists have devised a pretty accurate Real Estate prediction model using 5 factors – resulting in what can be termed as a housing MRI.  The items to consider are: 1. EMPLOYMENT 2. SUPPLY & DEMAND 3. APPRECIATION & REPLACEMENT COST 4. AFFORDABILITY 5. DEMOGRAPHICS & DATA.

Here’s the skinny on how these factors look in our specific Cache Valley/Logan market.

  1. EmploymentThis is a leading indicator of Real Estate strength.  The Department of labor and employment has graphed the impact of unemployment rate on Real Estate in markets all over the US, documenting that job growth and high employment rates = strong Real Estate market.  Utah ranks #1 in job growth, adding 46,600 jobs just in 2016.  Our state’s economy is ranked as #4.  According to the US Bureau of Labor statistics, the unemployment rate in Cache County as of September, 2017  is a mere 2.6% ( compared to 4.1% nationally).  The highest unemployment rate Cache Valley has seen in recent history was August 2010 at 6.9% – coinciding with the low point in our Real Estate market. Current employment/job stats bode very well for a continued strong local Real Estate market.     
  2.   Supply & Demand: Things to consider in this area are: changes in re-sale inventory, rise in new home inventories,  oversupply of apartment construction/vacancy rates.  Here the local indicators are actually very positive:  The Cache Valley supply/demand balance has been at a steady equilibrium for the past 2 years, resulting in low inventory of homes for sale despite the abundance of new construction.  The average days on market (DOM =average time it takes for a home to sell) is currently 41 days -with those priced between $100-$200,000 taking just 26 days to sell, and homes priced at $400,000 + taking an average 110 days.  Despite the perception (my perception) of new homes cropping up like… well crops- actual figures don’t indicate overbuilding of either single family or apartment buildings.  Here are the numbers for building permits pulled in Cache County the past 3 years.  In 2015, 393 single family permits were pulled and 104 apartments.  In 2016, 468 single family and 42 apartments. In 2017 (to date) 410 single family have been pulled and 187 Apartment units.       In Contrast, back in 2006 & 2007 (prior to the market crash) there were over 650 permits pulled each year.  Apartment vacancy rates are below 1% with waiting lists in many cases.  It appears the additional apartment units & single family homes being built will be easily absorbed by the increased/increasing population (see point 5)
  3. Appreciation & Replacement costs:  As mentioned earlier, home appreciation in Cache County has gone up around 22% in the past 2 years, and according to FHFA.gov, Utah ranks 5th in the nation in home appreciation.  Over the past 5 years, home prices in Utah have gone up 45.46%.  Replacement costs have gone up at about the same rate – indicating a strong, stable market.
  4. Affordability:  This is an index based on home price, mortgage interest rate, and median family income.  Local statistics are readily available on the median single family home price (currently around $228,000 in Cache Valley) and on the mortgage interest rate (30 year fixed – 4%).  Unfortunately, I’ve been unable to find any credible current numbers on the median family income… available data is from 2015, and shows the median income at $51,000 for Cache Valley.  My hope is that household income has been increasing somewhat commensurate with the increase in home prices so that affordability is a positive index.  Since lenders have much stricter parameters in qualifying buyers than they did during the last Real Estate fiasco, and buyers are still able to get loans, it can be assumed incomes must be also rising.
  5. Demographics & Data:  This index is positive indeed for Cache County.  The latest estimates from the US Census Bureau show Cache County as the 20th fastest growing metro population over $50,000 in the US, reaching an estimated $131,441 by the end of 2017, up 2.% since 2010.  Utah in general ranks #1  in population growth in US- resulting from both high birth rate and influx of people moving from other states/countries. Cache Valley/Logan continues to rank low in crime and high in outdoor recreational opportunities (specific rankings vary depending on the study, but all are favorable).

Based on statistical information, the Cache Valley/Logan Real Estate market IS NOT in “bubble trouble”.  This is a desirable place to live, and people are moving here.  Unemployment is low.  Job Growth is positive.  Inventory is low with a stable balance of supply and demand – even with new construction factored in.  The appreciation rate may level off – and that is expected, but there are certainly no indications of any depreciation in the foreseeable future.

If you would like any other Real Estate information, have questions about purchasing or would like to know the value on your home, please feel free to call or e-mail me.

Terri Sizemore 435-770-9407 supersizemore58@gmail.com

 

 

The truth about on-line home valuations….  

The truth about on-line home valuations in Utah (i.e.… Zillow zestimates, Trulia estimates)

 

I frequently get calls from friends and clients – confused or upset because they saw a “zestimate” that valued their home at $25,000 below what we have it listed for or $10,000 below (or above) what they purchased it for…. Sometimes they’re excited because they think it will be justification to contest a property tax bill.

While offering an additional good marketing tool, sites such as Zillow and Trulia access information that is incomplete and therefore inaccurate.  Utah is a non-disclosure state – meaning sales prices are not public information.   Even in full disclosure states such as Colorado – where sales information is readily available, the MLS is the only really accurate valuation resource– providing important additional information such as square footage on each level of the home.  (Main level square footage is more valuable than 2nd floor footage – which is more valuable than below-grade space).

Real Estate professionals are able to access information from the MLS – evaluating home sales of homes comparable to yours in size, style, age and condition – including the very important square footage per floor comparison; thereby arriving at a reasonably accurate home valuation.  Appraisers perform an even more in- depth evaluation of “sold” comparisons –thus providing an even better assurance of  home value.

In summary:  Don’t stress (or celebrate) about a zestimate or any other on-line look up home evaluation.  If you need to know what you home would sell for right now, call your knowledgeable Realtor – ask her or him to please look at your home, take some time to pull and evaluate comparable “solds” and voila – you’ll find out within reasonable accuracy what your home is worth.

As a buyer, why should I use a Realtor?

For your protection

Buying a home is a very important and expensive purchase – probably the most important purchase you will ever make. It’s very important to have someone help you who is educated in all the facets of real estate.

Unlike hiring an attorney to represent you, it’s one of the few instances in life where you can have professional representation and you don’t even pay for it.  Realtor fees are typically paid by the home seller.  Brokerage commissions are split by the Realtor listing the property, and the Realtor bringing the buyer.  As a buyer, it is generally in your best interest to have a Realtor representing YOU versus using the listing agent who represents the seller.

Realtors have knowledge & CONNECTIONS

A competent Agent knows the market and will do research on the value of homes you’re interested in. If questions arise about properties, they do the necessary research with county records, cities, etc… they’ll find the answers to questions about animal rights, water rights, covenants etc…allowing you to make a well-informed purchasing decision.

They have connections with other professionals.  They can direct you to qualified lenders, reputable inspectors, contractors etc…

         They’re trained Professionals

  1. Real estate professionals take classes continually to make sure they’re educated on all new laws, procedures, forms etc…
  2. They have experience. .. The first time doing anything is always rocky and uncertain. experience helps take away the rockiness.
  3. Realtors pay dues for full access to the MLS (multiple listing service)- they can access and research all of the properties for sale (not just those from a particular brokerage), share listings via the internet, and then physically show you homes that interest you.
  4. Realtors are able (time allowing) to preview homes before you see them…saving you time if you’re clear on your parameters.
  5. Paperwork…They know what forms and contracts are needed and will make sure they’re filled out correctly and legally.
  6. They will manage the transactions and dates for you.
  7. Maybe most importantly, a trustworthy Realtor will negotiate the best terms for YOU. After you find that perfect home, research will be performed to determine the true market value of the home, ensuring that you know what you’re buying, and you don’t overpay

 

A competent, honest Realtor is invaluable in making your home purchase a smooth, safe and happy transaction.  If you’re thinking about purchasing a home I would appreciate your consideration when choosing a Realtor.  Terri Sizemore 435-770-9407