3rd Quarter Update from The Salt Lake Board of Realtors (R)

SALT LAKE BOARD OF REALTORS®

REALTOR

Broker Town Hall
3rd Quarter Update

A lot is happening in the housing market nationally and locally. Here are the highlights:

1. NAR reported that September home sales were up 10 percent compared to August, but down 19 percent compared to September last year.

2. Standard & Poor's released its Home Price Indices Tuesday. Home prices decreased from July to August in 15 of 20 major U.S. cities (Salt Lake is not included). The report said that "home prices broadly declined in August...the housing market continues to bounce along the recent lows." The Wall Street Journal head­line was "Housing Gloom Deepens."

3. Nationally, home sales won't really take off until 2012, according to the Mortgage Bankers Association. At that time, existing home sales are expected to rise 16 percent. New home sales will be up 40 percent.

4. Here in SL County, home sales are continuing to sputter. In September, home sales were down 8 percent compared to August and down 27 percent compared to September 2009. Home sales of all housing types in SL County from January through September are down 1 percent compared to the same nine-month period last year.

5. In SL County, single-family home sales in the first nine months of 2010 are up 1.5 percent compared to sales in the same period in 2009.

6. The median house price in September in SL County was $210,000, down 3 percent compared to August, but up 1.5 percent compared to September 2009.

7. Nationally, half of 109 economists and housing analysts surveyed by MacroMarkets LLC are expecting home prices to bottom in 2011 (this is in line with what Jim Wood predicted last January in our 2010 Salt Lake Housing Forecast report). However, the other half of economists in the survey said home prices won't

bottom until 2012.

8. In Utah, single-family new home permits from January through August are up 19 percent compared to the same eight-month period last year (Bureau of Economic and Business Research). This is great news and indicates that people are again buying new homes which in turn will help stimulate Utah's economy.

9. Utah's unemployment rate is at 7.5 percent. Nation­ally, it is at 9.6 percent. There are 9,000 more jobs in Utah today than there were last year at this time (1 percent increase). "The Utah economy is improving," according to Mark Knold, chief economist for the Utah Department of Workforce Services. "Yet the head-winds of the recent recession remain strong, and what employment growth is being generated is tempered by continuing credit restraints and uncertainties bred by the recession. A significant number of jobs were shed during the recession in Utah, with the low point reached in early 2010. The Utah economy is now recovering, but the movement upward has been slow, and there is much ground to regain."

10. There is a growing national debate over the mortgage-interest deduction (MID). An Obama Admin­istration commission has not ruled out recommenda­tions that would scale back the mortgage-interest deduction, according to the Wall Street Journal. There are also many "talking heads" and experts calling for its demise. On CNBC yesterday one panelist called the MID a "market distorting tax break" and said there was no link between the deduction and greater hom­eownership. This is an issue that NAR is fighting. Lawrence Yun, chief economist for NAR, said those opposing the MID are ignoring two critical facts. "First, home owners already pay 80 to 90 percent of the income tax in our country, and among those who claim the MID, almost two-thirds are middle-income earn­ers." In addition to attacks on the MID, the national and local media continue to run stories questioning the value of owning a home.