Wasatch Front

Salt Lake County Real Estate Agent: How Inventory Affects the Wasatch Front Market

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• published: 28 Jun 2016
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Simple supply and demand laws in real estate would indicate that we’re in a balanced market where neither buyers nor sellers have an advantage. If you break down the inventory by price bracket, however, we find that this is not the case. The supply is having an effect on both highly-priced and lower-priced homes, and is also affecting the townhome and condo marketplace. To learn why, watch this short video. http://thesternteam.blogspot.com/2016/05/how-inventory-affects-wasatch-front.html ABOUT: Looking to buy, sell or invest in a home to live in Salt Lake? Joshua Stern and his team are here to ensure you have an excellent real estate experience. Built in 2002, The Stern Team continues to build our business based upon the same business philosophy we started with, “People don’t care how much we know, until they know how much we care”. With full time dedicated staff, and the “best of the best” agents, we know how to help our clients with their home selling, home buying or real estate investing goals. Ask us about our Worry Free Service Guarantee®, which puts our clients in the driver’s seat. No long term contracts or fear of obligation. Whether you're downtown, uptown, metro or mountain, Josh’s unique V.I.P. Buyer System guarantees our clients access to properties that match exactly what they’re looking for, literally as they come on the market. Our property lists include homes from EVERY Salt Lake neighborhoods' Realtor and Brokerage. They also include bank owned homes, government owned homes, corporate foreclosures and our own very special PRELIST properties that are not even on the market yet. Want to sell your Salt Lake County Home? Get a FREE Home Value Report: http://www.servingsaltlake.com/sell/ Want to buy a Salt Lake County Home? Search All Homes For Sale: http://www.viewsaltlakecityareahomes.com/ Joshua Stern The Stern Team 2121 S McClelland, St. #201 Salt Lake City, UT 84106 Phone: 801-859-7509 Fax: 801-326-8615 TRANSCRIPTION:. The law of supply and demand in real estate is irrefutable. It’s important to understand. Generally, if there’s a low supply and a high demand, price will be high, of course. In contrast, the higher the supply and the lower the demand, the lower the price. So let’s define inventory and absorption rate in real estate. If you take the amount of available homes and you divide that by the amount of homes sold in the past 30 days, you’re left with what’s called a month’s supply of housing. It’s considered a level market when you have between four to six months supply of homes. If there’s less than four months of supply, it’s a seller’s market. Likewise, more than six months of supply of homes gives us a buyer’s market. So let’s take a look at the Wasatch Front’s supply of single-family homes (excluding townhomes and condos). Right now we have a 4.4 month supply of of homes available. Seems like we’d be in a level market, right? Not so fast. If we look at homes by price range, we only have a 3.4 month supply of homes on the market under $350,000. If we look at homes under $250,000, we have just 2.75 months of supply. This poses a real challenge for first-time homebuyers, as they’re finding they are competing with multiple offers for almost all of the well-priced homes under $350,000. For that reason, we’re seeing condos and townhomes really take off as affordable housing for first-time homebuyers. In this market, we only have a 3.78 month supply of such homes along the Wasatch Front. As a result, we’re seeing buyers try to tie up homes to lock out the competition - sometimes without even seeing the inside of the home before writing an offer! This allows people to lock up a property even though they sometimes cancel the offer down the road after finding a better option. We’re seeing a lot of this right now.