SALT LAKE CITY — Utah's current housing crunch is expected to only get worse next year, not better, according to a new report released Tuesday.
The "State of the State's Housing Market" issued by the Kem C. Gardner Policy Institute contains both good and bad news for those already owning homes and those looking to buy.
New households in the state are expected to outnumber new housing units in 2024, with a shortage increasing to 37,000 units next year, the report says.
Even worse than the shortage is that fewer people are now able to afford a home as high interest rates and prices grow. Only 15 percent of Utah's renters have the income to purchase what the report describes as "modestly" priced homes between $300,000 and $400,000.
Renting will also continue to be an issue as rising rents and low vacancies will push people out.
"The average rental rate in Wasatch Front counties has increased at a rate of 6.5% to 7.0% annually since 2011, nearly double the rate of increase in the median income of renters," the report says. "The average rental rate in Salt Lake County is now $1,570, which requires an income of $60,000 to qualify as a tenant."
In regards to home prices, those numbers fell as expected during the pandemic, although at just 5 percent in year-over price. However, the report believes that was just a one-year pause and that prices should increase in 2024.
Rising home prices is good for homeowners and realtors after the report showed existing home sales dropped nearly 20 percent in 2022, with just over 40,000 units being sold, the lowest level in eight years.
In 2021, the median days on market for homes in Utah averaged a low of seven days at one point, then rose to 52 days during a period in 2022, the highest level since the Great Recession. That number has since fallen to just 24 days even with high mortgage rates.
