2021 was a historic year in the housing market across the nation, but its impact was especially felt here in Salt Lake City and Park City. The great reshuffling of America’s workforce brought on by the surge in remote work and the swell of investor cash has changed many aspects of where, when, why, and how people buy and sell homes. Couple this with Utah’s bustling economy and turbo-charged growth, and we aren’t surprised by the incredible gains our local housing market made over the past year.

This was a record year in almost every metric recorded across the real estate market (except one big one). We saw record-low inventory and median days on market, record-high median sales prices, plummeting mortgage rates, and a surge in demand for second homes. Of note, we did not eclipse last year’s recording-breaking total number of homes sold (although it looks to still hit the top 10). But all in all, these trends point to an incredibly strong market as we head into 2022.

So let’s recap the 2021 market and take a closer look at what’s to come in 2022.

Salt Lake County – Year/Year Market Stats for Single Family Homes

• At 11,576 units sold this year, we saw a decrease in sales by 11% over 2020.
• Median sold price increased by 25% from 2020 from $423,000 to $530,000 in 2021. Of note, the rate of increase is also accelerating. Between 2019 and 2020, we saw the median sold price increase by 11%.
• There were 13,052 new single-family listings on the market in 2021, which is a 10% decrease from 2020 when there were 14,572.
• The median days on market for 2021 was 6, which is a 50% decrease from 2020 when it was 12.

Summit County – Year/Year Market Stats for Single Family Homes

• At 782 units sold this year, we saw a decrease in sales by 11% over 2020.
• Median sold prices increased by 19% over 2020 when it was $1,385,000 to $1,650,000 in 2021. Interestingly, the rate of increase in Summit County is actually decelerating. Between 2019 and 20202 we saw the median sold price increase by 33%.
• There were 916 new single-family listings on the market in 2021, which is a 14% decline from 2020 when it was 1,074.
• The median days on market in 2021 was 18, which is a 58% decrease from 2020 when it was 43 days.

What Does 2022 Have in Store for the Utah Real Estate Market?

A quick look at the national trends shows that US home price growth is actually beginning to decelerate after more than a year of consecutive price increases month-over-month. But is this an indication of an impending market decline? Not at all.

We can all agree that the current rate of price growth is not sustainable. Nationally, it clocked in at 19% in 2021 according to the S&P/Case-Shiller U.S. National Home Price Index, and for the entire state of Utah, it hit 24% year-over-year. That’s an incredible rate of increase for just one year.

When we look at Salt Lake County and Summit County specifically, the rate of increase has been similarly shocking, up 25% and 19%, respectively.

Currently, there is not a consensus as to what the rate of growth will be in 2022 because there is not a consensus on what the mortgage rates will do in 2022. Some believe that mortgage rates will accelerate quickly, which will hold price appreciation back a bit, while others believe rate increases will be more moderate and tempered, allowing price growth to keep going strong.

It is important to note that COVID-19 trends seem to be an indicator of mortgage trends, as they were throughout 2021. Based on what we saw last year, it seems that if we see widespread COVID surges throughout the winter, we may see lower rates in the spring. But, if we remain on the overall path to recovery, rates will likely modestly rise in the long term.

Although the rates did spike a few times in 2021, they remained low. The Federal Reserve Board recently said it will raise rates this year, but it will be moderate. As a result, we predict rates will remain relatively low in 2022.

In a record-setting year, it’s interesting to note that the total number of sales is down across Utah. Utah is still reeling from the effects of the last Great Recession and its systemic housing shortage problem. COVID-19 added new constraints with supply chain and labor shortages, directly affecting builders. And since buying a new home in this market can be trying (and expensive), some would-be sellers opted to invest into their current home instead of selling and buying a new home. So the cycle sort of fed itself – low supply pushed some would-be sellers to stay put, builders are limited in what they can build, prices continue to push higher, and sales ultimately slowed a bit.

Will We See Prices Continue to Increase in 2022?

Last year we predicted an increase of 4-9% in sales price, which was clearly not the case. So are we willing to make another prediction for 2022? Yes!

Realtor.com predicts a 15.2% increase in total sales and an 8.5% increase in prices for Salt Lake City in 2022, year-over-year. Although they analyze far more data than we do, we think it might look a little different.

In particular, we don’t think our total sales will increase quite that high, or much at all, from 2021’s final numbers, which have not yet been released at the time of this writing.

We also think prices will increase more than 10% year-over-year. Exactly how high, we aren’t sure (or that psychic). But we do see sizable gains as we prepare folks who are selling their home this spring. It is still a really tight housing market and our inventory levels will not meaningfully change this year, so we are confident prices will continue to increase. Especially in the near term.

In a competitive market such as this, it’s absolutely vital to work with a great real estate agent. Someone who knows the market, the area, and can confidently help you make good investment decisions that will benefit you in the long run.

Our last piece of advice as we head into 2022 is to simply reach out. Let us know if you’re thinking of selling and what your plans are. We can get you the highest price for your home, guaranteed. With all the news about the strong market heading into 2022, don’t be tempted to sell your home yourself. While you may ultimately get it sold, we are confident that we can help you net more money on the sale of your home if we work together. Our fees are flexible and we offer an array of services to help you navigate the sale in a way that fits your personal needs best.

Every year we are grateful for the opportunity to work with amazing people across the region. It’s truly the clients who make our work worthwhile and we’d like to take this opportunity to thank you for your continued support and trust in our business.

Wishing you a great start to the New Year!

Julia + Kate