Utah Real Estate Market Outlook

Utah’s economy lies in tourism (national parks, ski resorts, cultural shows like film festivals and theater performances) and mining. However, the recession has impacted the state’s industries that resulted to massive layoffs in every city. Job cuts were rampant in the media, education and even health care industries.

There has been an observed steady increase in the foreclosure cases in Utah. Interestingly, not all of those who jumped in the real estate bandwagon boom are giving up their houses. This segment of buyers is secured of continuous mortgage financing mainly because they haven’t taken out adjustable rate mortgages in the first place. For those who did, they’re in for higher rates once their loans reset this year. Generally, the city’s housing market is beginning to feel the pangs of the crisis as cities that had sales peaks during the boom are now experiencing high vacancy rates.

Salt Lake City’s property market is adjusting to the credit crisis in the country. Lenders are still weary as to how they can continue offering loans but still minimize the risk of default. Major industries in oil refining, business services, retail and aviation are fighting their way out of losses and save thousands of employees from layoffs. It’s a dire reality for this city teeming with industrial banks.

RealtyOutlook.com forecasts a 9.5 percent drop in home values in the area. This downward trend comes after a series of home prices scaling to new records. Last year, home sales were salvaged by first-time buyers who took advantage of the tax credit for new homeownership.

Ogden’s property market has cooled since the credit crunch slugged home buying last year. The economy is dodging further downturns by the crisis through aggressive marketing of its tourism and recreational facilities. The city is also banking on aerospace development which is believed to provide more employment. RealtyOutlook.com is expecting home values to sink by 7 percent in this principal city in the Utah Metropolitan Area.

Logan is a contrast to the other metros in need of property market relief. With a population of less than 50,000 people, the city didn’t follow suit in the national real estate boom a few years back. It may be attributed to the lower pay among jobs in the metro. But the city government breathes a sigh of relief since the housing inventory isn’t on a high rate this time. In fact, RealtyOutlook.com is optimistic about this northern Utah area that a 2 percent hike in home values is high probable in 2009.

Provo is having a dismal real estate scenario that was carried over by last year’s home sales slump. The city ended up inundated by foreclosed homes that await buyers in a recessionary climate. Still, there is much potential to this city bordered by mountain ranges. Last year, corporate aircraft services company Duncan Aviation sealed plans of building its repair and painting facility in the area.

Because of fewer sales, Provo’s average home values will drop by 7.5 percent this year. It’ll be a tough call for the city that brokers and investors will have to contend with.