March 6, 2024

Rising Rates, Shifting Demographics: What to Know About the Utah Housing Market in 2024

Written by

Sara Hiatt

This past month we attended the 2024 Utah Housing Forecast and we can’t wait to share our takeaways with you.

Here are the highlights you’ll want to know!

Recent home sales are at the lowest level since 1995. The amount of homes sold in the Salt Lake City area in 2023 was down 43% from 2019.

We mostly attribute the decrease in the amount of home sales to rising interest rates. As rates increased it made monthly payments jump, pricing many homebuyers out of the market. Equally impactful, it encourages home sellers to stay put - giving up low monthly mortgage payments isn’t appealing.

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What are the experts predicting those interest rates to do in 2024? We have all heard the Feds will be lowering interest rates this year, but with strong jobs reports and other economic indicators, it hasn’t significantly happened yet. We stand a chance of it happening again in May, but it is unlikely to take drastic measures. It is interesting to see where the experts predict the rate to land by the end of 2024, but the most current state of the market would suggest it might land on the higher end of these predictions.

In 2022 we saw a tale of two housing markets - what that means is that New Construction home sales were vastly different from existing home sales. National new construction home sales for 2023 were 11% higher than they were in 2022. This seems like an anomaly, but it’s due to the massive incentives builders were able to offer buyers, like rate buydowns. This will continue into 2024 but will slowly diminish as the amount of new construction inventory lessens. Utah’s new construction homebuilders are reporting to be more cautiously optimistic about starting new builds in today’s climate.

As Realtors we understand the power of rate buydowns, and it is something we actively seek to have sellers pay for our buyer clients. We don’t rely solely on new construction builders to get those buy downs for our clients, we fight for them on almost every offer we submit.

In 2023 the largest percentage of homebuyers came from the Baby Boomer generation - with 39% of home purchases coming from this generation. That's a change from 2022 when it was Millennials making the majority of home purchases. This is interesting data when put in light of statistics that show the boomer generation already owns the highest amount of “large homes.” This shows us that the next decade or two could lead to dramatic shifts in home ownership generationally.

If you have questions about the current state of the housing market, new construction options, or even how to continue your net worth through real estate - reach out!