2019 Forecast for Salt Lake Market
2019 Forecast
I attended the Utah Board of Realtors Forecast breakfast on Friday where James Woods, a U of U economist spoke on the fundamentals of the Salt Lake Market.
Do you agree with his forecast?
Most Popular Reply
I like the report's basic numbers, but it's too general to make an action plan. I expect the most affordable homes along the Wasatch (SLC West-side, Ogden area, White City, Tooele, Eagle Mtn) to be very strong this spring and summer. - Great for flips and rentals, especially with SFRs under 250K (ARV under 300K). The closer to town the better! Builders simply cannot build an SFR under about 325K, unless you go out to Eagle Mountain (AKA Egypt).
I would avoid the higher end (500-600K+ depending on the area) unless the discount is really amazing, like 30% or more off retail.
If interest rates rise, The higher end will be hit hardest. Generally, people don't like to "trade up" if they have to give up their current mortgage at 3.5% for a mortgage close to 5%.
Buying homes in West Valley, West Jordan, even Ogden, that can function like a duplex could be a great strategy for cashflow.
When fall comes, things will slow down again, as always, and the talk will increase about a "market crash." Don't believe it! I think spring 2020 will be very strong again, especially if Elizabeth Warren and other political progressives have their way and expand lending to the "under-served communities" (read loosening standards). again, this will drive up demand, prices, and rents in the lower end.
There are always unforeseen possibilities that can effect the real estate market in very negative ways, such as the impeachment of Donald Trump or a true 50% crash in the stock market, a global corporate credit freeze or a Zombie apocalypse.
That's my 2 cents. Now, go make your own luck!