The Cooling Off Period Starts Now: First Time Buyers Squeezed as Supply & Price Pressures Amp Up

Posted in Salt Lake City Market | Posted on 11-04-2014 | Written by Metrostudy News

  • Production at lower price points is dropping, with annual starts under $300k down 19%
  • Median price for a new Single Family home is up 9% YoY to almost $331k
  • Attached homes are the shining star in the market with starts up 15% on an annualized basis

November 2014:  Metrostudy’s 3Q14 survey of the Greater Salt Lake market shows that while the housing market has been experiencing some slowing in the last few quarters, new home production remains healthy. According to Metrostudy’s quarterly survey, there were a total of 2,125 new homes (both attached and detached) started during 3Q14, which is a 16% decrease compared to 3rd quarter last year, however increased +13% from 2Q14. Closings for the quarter dropped 1% compared to last year and increased 9% from last quarter, for a total of 2,049. The pace for annual new home starts has declined for the past two quarters, causing a bit of concern within the industry. Annual starts totaled 7,739 at the end of September, -3% fewer than last year at this time.

Annual new home closings have increased 4% compared to 3Q14, however the pace slowed 0.3% from last quarter, to 7,694. Annual starts for Single Family detached homes have decreased 7% compared to last year at this time for a total of 5,711. However, new home closings have increased 3% over 3Q13 for a total of 5,734.

Attached (for sale) homes continue to be the shining star in the market with a +15% increase in annual starts over last year with 2,028. Annual new home closings totaled 1,960 as of the end of September, up 8% over last year at this time.

Annual New Home Starts By Price Range

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“The mix of buyers has been heavily weighted towards the move-up market, leaving the entry- level buyer somewhat depressed, due to the rapid increase in prices and difficult lending environment,” said Eric Allen, Director of Metrostudy’s Utah and Idaho region.  “This trend continues as annual starts above $300,000 have increased +17% over last year, while the pace has decreased -19% for starts under $300,000. While new home prices have increased very rapidly for the past few years, the pace appears to be slowing ever so slightly. The median price for a new Single Family home has increased +9% from last year at this time to $330,900, and is +1% above last quarter. The median price for a new Attached unit currently sits at $208,400 which is +7% higher than last year at this time, and +1% above last quarter.”

As of September, there is a 6.7 month supply of single family detached home inventory in the Greater Salt Lake market, which is down slightly from 7.0 months at this time last year, and up slightly from the 6.6 months recorded last quarter. Under construction inventory decreased 9% compared to last year at this time; however increased 4% from last quarter, and currently has a 4.8 month supply. Finished vacant home inventory has increased +32% from last year, however decreased -7% from last quarter to a 1.5 month supply.  This is up from only 1.1 months at this time last year, and down from 1.5 months last quarter. There is currently a 9.0 month supply of townhome units in inventory,,which is up from 8.7 months recorded last year in 3Q13. Of this, 912 are under construction, a 6.5 month supply. There are also 273 finished vacant units on the ground, which is up +34% from last year, and is a healthy 2.0 month supply. Condo inventory totaled 732 units, which is a 30.2 month supply.

Inventory of vacant developed lots (VDL), or finished lots, for single family detached homes have recently leveled off with 15,343, virtually unchanged from last year. While overall lot inventory is essentially unchanged over the past year, lot deliveries have increased to the highest levels since 2009,” said Allen. “There have been 7,773 new lots delivered over the past year, compared to 4,893 in 3Q13. Despite the spike in deliveries, lots are being absorbed quickly, particularly for homes priced from $200,000-$400,000, where the supply remains within equilibrium at 19.2 months, while lot inventory for homes above $400,000 is 54 months.”

“Metrostudy expects demand to remain relatively steady for the next year, despite the pressures from lack of supply, rising prices and the possibility of increased interest rates,” said Allen.  “The market is simply experiencing a cooling off period, coming off the heels of one of the most rapid recoveries on record.”

For information contact
Eric Allen 801.571.7700 x424
eallen@metrostudy.com

About Metrostudy

Metrostudy is the leading provider of primary and secondary market information to the housing and related industries nationwide. Metrostudy provides research, data, analytics and consulting services to help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day. For more information, visit www.metrostudy.com

About Hanley Wood

Hanley Wood, LLC is the premier information, media, event, and strategic marketing services company serving the residential, commercial design and construction industries. Utilizing the largest editorial- and analytics-driven construction market database, the company produces powerful market data and insights; award-winning publications, newsletters and websites; marquee trade shows and executive events; and strategic marketing solutions. To learn more, visit hanleywood.com.

 

 

We’ve got LOTS to Talk About

Posted in National Housing Market, Northern California Market, Sacramento Market, Salt Lake City Market, Southern California Market, Tampa Market | Posted on 11-04-2014 | Written by Brad Hunter

brad hAs we approach the end of the year, it is always important to start to imagine what next year will look like for housing.  I think about that question every day, debating it, analyzing it, looking at the data, and imagining different scenarios.

Over the past few years the public on builders have been announcing that they have wanted to increase their community counts. To that end, large amounts of land were bought in 2012 and 2013 that are now being seen in the data as new lot “deliveries.”  We are seeing strong increases in new lot development in markets all around The country.  (“Lot deliveries” means the number of lots brought to the stage where they are ready for a builder to begin construction — roads and infrastructure in place).

Lot Deliveries Catching up with Demand

3q BH

Let’s take a look at some national trends as well as some specific local market trends, which can lend a glimpse into the direction of single-family housing starts for 2015.

Nationwide, lot deliveries are still trailing housing starts by a tiny margin, but the gap has finally nearly closed as lot deliveries rise sharply.  In some markets, the lines have crossed (meaning that lot deliveries are now running at a pace higher than starts), and that is a bullish sign for starts in 2015.

In the broad area we call “Southern California,” lot deliveries are running at an annual pace of 17,587 (during the four quarters ending 3Q14), and that is well above the pace of a year ago (11,784), and is also above the annual pace of housing starts (15,817).  These factors both suggest immediate plans to increase home construction volume.

In Salt Lake City, annual lot deliveries are up slightly, to 7,905 in the four quarters ending 3Q14.  This level is also higher than the last 4 quarters worth of starts (7,739).

In Tampa, lot deliveries have totaled 7,301 during the past year, up from an annual pace of 3,926 a year ago.  This level is far higher than annual starts, now running at 5,995.

In Northern California, lot deliveries are running 13,098 annually, up from 8,826 four quarters ago.  The pace of lot deliveries has been outrunning starts, which are at 10,918, but very likely to move higher, based upon these new communities and lots.

These examples might not have been too surprising, but here is one that is (or maybe I should say “encouraging”):  Phoenix.  Lot deliveries are running at 14,914, up versus 8,608 a year earlier.  This recent pace is in excess of the pace of housing starts, which has run 13,460 over the past four quarters.

What to make of this:

* On the demand side, the “case” for an elevated level of production hinges on higher job growth, which should bring with it better consumer sentiment and the release of more pent-up household formations.

* On the supply side, builders have been pushing for higher community count, and that means more lot development.

This surge in lot development will very likely result in an increase in the pace of home building next year.  The trajectory of housing demand is flatter, however, than when the builders bought the raw land that is now being turned into these lots.  In some cases, builders will have to price their homes at a level lower than what they had assumed when they originally underwrote the land purchase, or face a slower absorption pace.

That said, the long-term trajectory is decidedly upward.

 

Salt Lake City 2Q14 Survey: Affordability Continues to Have a Stronghold on the Market

Posted in Salt Lake City Market | Posted on 08-21-2014 | Written by Metrostudy News

August 2014: Metrostudy’s 2Q14 survey of the Greater Salt Lake market, annual new home starts  – both attached and detached – totaled 8,209 as of June 2014, up 9% from the annual pace last year at this time. Annual new home closings increased 8% compared to last year, for a total of 7,742. New home starts during the first half of 2014 have decreased 2% compared to the same time last year. Annual starts for Single Family detached homes have increase 6% compared to last year, however down -4% from the annual pace recorded last quarter (1Q14). New home closings have increased 7% over the pace last year. Annual starts for Attached (for sale) homes have increased 20% over last year’s pace, and annual new home closings are up 11% from a year ago.  While the sentiment regarding the housing market may be waning, evidence shows that the market remains strong.

“Affordability continues to have a stronghold on the market, limiting the number of consumers that are able to qualify for a home,” said Eric Allen, Regional Director of Metrostudy’s Utah/Idaho market. “Home prices have risen rapidly over the past year, which has pushed many first time home buyers to the sidelines, or in a rental holding pattern.  However, recent figures show that price increases across the market have been less dramatic than the past year or so.  The median price for a new Single Family home has increased 11% from last year at this time to about $325k, while up only 1% from last quarter.. The median price for a new Townhome unit is 7% higher than last year at this time to approximately $205k, and 1% above last quarter, and the median price for a Condo unit increased 8% from last quarter to $174k.”

As of June, there is a 6.6 month supply of single family detached home inventory in the Greater Salt Lake market, which is up from 6.3 months recorded at this time last year, however remains within equilibrium. Under construction inventory for detached homes rose 3% compared to last year at this time, however decreased -3% from last quarter; and currently sits at a 4.6 month supply. Finished vacant home inventory (or otherwise known as spec homes) has increased 49% from last year at this time, and up 18% from last quarter. Despite the increase, the supply remains healthy at 1.6 months, up from 1.1 months in 2Q13. So far, closings have kept pace with the market, resulting in a healthy level of finished vacant homes, however it will be imperative to monitor as we push into the second half of the year.

There is currently a 9.2 month supply of townhomes in the market, which is up from 8.3 months recorded in 2Q13.  Under construction inventory has increased 10% over last year, and remains within equilibrium with 6.8 months of supply.  Finished vacant inventory has increased 85% from last year, however the supply remains healthy at 2.0 months.  New home inventory for Condos currently sits at 26.3 months, a level considered above equilibrium.  Inventory of vacant developed lots (VDL), or finished lots, for single family detached homes declined 3% from last year, however increased 3% from last quarter to a total of 15,571. Based on current absorption, this is a 30.7 month supply.

“While the overall supply of lots appears to be above equilibrium, there are areas and specific projects in the market that continue to have a negative effect on this supply,” said Allen. “For instance, there are just over 5,500 vacant lots for homes priced above $500k, which represents an 80 month supply.  This compared to the 17.2 month supply of vacant lots for homes priced from $200k-$350K, a level considered to be below equilibrium.  Vacant developed lot inventory for townhomes decreased 6% from last quarter, which is a 16.8 month supply. There is also a 42.1 month supply of vacant lots for condos on the ground.  There have been nearly 7,700 new lots delivered to the market over the past year, while builders have absorbed 8,209, for a net decrease of 514 lots.”

The Greater Salt Lake housing market has enjoyed a strong recovery and rapid growth since 2011, and with that, improvements have occurred in the economy and consumer confidence. While the housing market may not be expanding at the same pace as last year, momentum is expected to continue.  The fundamentals of the economy remain strong, which keeps those in the housing industry optimistic about the future.

Top Ten Projects (based on new home starts / Attached & Detached)

Daybreak – 476

Rosecrest – 249

The Ranches – 205

Independence – 166

Foxboro – 161

Sleepy Ridge – 133

Bingham Junction – 131

Iroquois – 110

Herriman Town Center – 91

Stansbury Park – 88

For information contact Eric Allen @ 801.571.7700 x424
email eallen@metrostudy.com

About Metrostudy

Metrostudy, a Hanley Wood company, is the leading provider of primary and secondary market information to the housing and related industries nationwide.  Established in 1975 in Houston, Metrostudy provides research, data, analytics and consulting services that help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day.  www.metrostudy.com

About Hanley Wood

Hanley Wood is the premier information, media, event, and strategic marketing services company serving the residential, commercial design and construction industries. Utilizing the largest editorial- and analytics-driven construction market database, the company produces powerful market data and insights; award-winning publications, newsletters and websites; marquee trade shows and executive events; and strategic marketing solutions. To learn more, visit hanleywood.com.

2013, Another Banner Year for the Greater Salt Lake Housing Market

Posted in Salt Lake City Market | Posted on 01-27-2014 | Written by Metrostudy News

(Salt Lake City, UT – January 27, 2014) The Greater Salt Lake market experienced significant growth throughout 2013, and despite some of the headwinds, expectations remain positive for 2014.  This is according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

According to Metrostudy’s quarterly survey of the Greater Salt Lake market, annual new home starts (both attached and detached) totaled 8,428 for the year 2013, a number not seen since 2008. New home starts during the 4th quarter totaled 2,048, which is 20% higher than last year at this time, however decreased -19% from last quarter.  “Despite this decrease, the market is experiencing a normal seasonal trend, and poses no reason for concern at this point” said Eric Allen, Regional Director of Metrostudy’s Salt Lake Market. Quarterly closings totaled 2,044 during the 4th quarter, which is 25% higher than 4Q12, and experienced a -2% decrease from last quarter. Annual new home closings increased 26% compared to 2012, with a total of 7,848 as of the end of December 2013.

As of December, there is a 6.4 month supply of single family detached homes in the Greater Salt Lake market, which is down from 7.0 months recorded at this time last year.  Under construction inventory for detached homes rose 20% compared to last year at this time, however decreased -3% from last quarter. “While this drop is a normal seasonal trend, winter set in a bit early this year and began wetter than normal, which may also had an effect on the decrease in under construction inventory form last quarter” said Allen.

Inventory of vacant developed lots (VDL), or finished lots, for single family detached homes declined -10% over the past year to 15,554.  The decline in lots, combined with an increase in home starts has allowed the supply of VDL’s to fall to 29.2 months, down from 39 months a year ago.  While the overall supply is slightly above equilibrium, it is important to note that the supply varies significantly by geography.  There are also 3,553 vacant developed lots for attached homes/units, which has decreased -4% from last year, however up 1.6% from last quarter.  At the current pace of absorption, this translates to a 21 month supply, down from 30.5 months a year ago.

About Metrostudy

Metrostudy is the leading provider of primary and secondary market information to the housing and related industries nationwide. Metrostudy provides research, data, analytics and consulting services to help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day.  For more information, visit www.metrostudy.com

About Hanley Wood

HanleyWood, LLC is the premier information, media, event, and strategic marketing services company serving the residential, commercial design and construction industries. Utilizing the largest editorial- and analytics-driven construction market database, the company produces powerful market data and insights; award-winning publications, newsletters and websites; marquee trade shows and executive events; and strategic marketing solutions. To learn more, visit hanleywood.com

1/23/13: Metrostudy – 2nd Annual NWHBA State of the Wasatch Luncheon and Growth Report

Posted in Events, Salt Lake City Market | Posted on 01-12-2014 | Written by Eric Allen

WHERE: Davis Conference Center in Layton
AGENDA: 11:30 a.m
The State of the Wasatch is FREE for all NWHBA members courtesy of our hosts — J.B. Parson Cos., US Bank Home Mortgage and Questar Gas.
SPEAKERS:   Eric Allen from Metrostudy will present his 4th quarter 2013 housing data for Davis and Weber counties, and Jim Wood, director of the University of Utah Bureau of Economic and Business Research, will discuss economic growth potential for 2014 and how new homes will play a role in that growth.
The room is limited to 150 people, so get your reservations as soon as possible. Contact Katie at mail@nwhba.net or (801) 479-5230 to reserve your seats today

HEADER 222

2014+State+of+the+Wasatch

State of the Wasatch
Luncheon and Growth Report


▪ Meet face-to-face with members of the Northern Wasatch legislative delegation

▪ Get the latest statistics on lot availability, home permits and starts, home price trends and more in Davis and Weber counties

▪ Hear about Utah’s economic growth prospects for 2014 and how new housing will play a role in that growth

Thursday, January 23, 2013

eric aWHERE: Davis Conference Center in Layton

AGENDA: 11:30 a.m

The State of the Wasatch is FREE for all NWHBA members courtesy of our hosts — J.B. Parson Cos., US Bank Home Mortgage and Questar Gas.

SPEAKERS: Eric Allen from Metrostudy will present his 4th quarter 2013 housing data for Davis and Weber counties, and Jim Wood, director of the University of Utah Bureau of Economic and Business Research, will discuss economic growth potential for 2014 and how new homes will play a role in that growth.

The room is limited to 150 people, so get your reservations as soon as possible. Contact Katie at mail@nwhba.net or (801) 479-5230 to reserve your seats today

Salt Lake’s new home market maintains stability in the third quarter

Posted in Salt Lake City Market | Posted on 10-26-2013 | Written by Metrostudy News

(Salt Lake City, UT – October 29, 2013) The turmoil surrounding the government shutdown has certainly had an adverse effect on buyer sentiment, however as key economic indicators improve, it is fair to expect continued stability in the housing market.  This is according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

According to Metrostudy’s quarterly survey of the Greater Salt Lake market, there were a total of 2,452 new homes started (both attached and detached) during the third quarter of 2013, the most starts in a single quarter since 2007.  This total is 19% higher than last year at this time and a 9% increase from last quarter.  Builders started 8,037 homes in the previous twelve months ending in September, which is 30% higher than the annual pace last year at this time.  New home closings during the third quarter increased 5% compared to a year ago for a total of 1,968, however decreased 1% from last quarter.  Annual closings totaled 7,346 over the past twelve months, which is an increase of 28% compared to 3Q12.

As of the end of September, total new home inventory for detached homes totaled 3,248, an increase of 23% from a year ago and 14% more than last quarter.  Despite the consistent increase, the supply remains healthy at 7 months.  The total number of detached homes under construction has increased 33% from last year, and up another 17% from last quarter. However, the supply remains within equilibrium at 5.5 months, which increased from 4.9 months recorded last quarter.  Finished vacant home inventory is a leading indicator of market changes, and based on the level of detached inventory, the market has been underserved for some time now.  There are currently only 526 detached finished vacant homes on the ground in the entire Greater Salt Lake market, which is -2% fewer than a year ago, however increased 4% from last quarter.  Despite this slight increase, the supply has remained unchanged for the past three quarters and sits at a low 1.1 months.

“The low supply of available lots has been a topic of concern for some time now and continues to intensify.  While the overall supply of vacant developed lots may seem high, builders continue to face difficulty finding appropriately prices lots in desirable areas,” said Eric Allen, Regional Director of Metrostudy’s Utah/Idaho Region.  There are currently 15,206 single-family vacant developed lots in the Greater Salt Lake market, which is down -15% from last year and another -6% from last quarter.  The supply has dropped from 44 months a year ago to 29.7 months currently.  There are also 3,507 vacant developed lots for attached homes/units, down -9.2% from last year and -.4% from last quarter.  At the current pace of absorption, this translates to a 22.2 month supply, down from 34.4 months a year ago.

For information contact:
eric allen @ 801.571.7700 x424
email eallen@metrostudy.com

About Metrostudy

Metrostudy, a Hanley Wood company, is the leading provider of primary and secondary market information to the housing and related industries nationwide.  Established in 1975 in Houston, Metrostudy provides research, data, analytics and consulting services that help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day.  www.metrostudy.com

About Hanley Wood

Hanley Wood, LLC is the premier information, media, event, and strategic marketing services company serving the residential, commercial design and construction industries. Utilizing the largest editorial- and analytics-driven construction market database, the company produces powerful market data and insights; award-winning publications, newsletters and websites; marquee trade shows and executive events; and strategic marketing solutions. To learn more, visit hanleywood.com.

Salt Lake’s new home market maintains strength in the second quarter of 2013

Posted in Salt Lake City Market | Posted on 08-09-2013 | Written by Metrostudy News

(Salt Lake City, UT – August 9, 2013) In the Greater Salt Lake market new home construction has been driven by real demand as a result of job gains, population inflows and a large pool of pent up demand buyers. This is according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

As of the end of June, there have been approximately 33,300 new jobs created over the past twelve months within the three (3) MSA’s that make up the Greater Salt Lake market. Based on the most recent numbers released from the Bureau of Labor Statistics (BLS), there are currently 1,070,300 people employed in the Greater Salt Lake market. While the unemployment rate experienced a .6% increase from May to June, the rate remains slightly above a level considered to be fully employed at 5.1%.  The local economy was experiencing tremendous growth during 2012, and while job creation has slowed in some sectors this year, all but one remains positive,” said Eric Allen, Regional Director of Metrostudy’s Utah/Idaho Region.

According to Metrostudy’s quarterly survey of all new home projects in the Greater Salt Lake market, there were 2,266 new homes started (both attached and detached) during the second quarter of 2013. This is a +29% increase over 2Q12, and +40% higher than last quarter. Annual starts for single-family homes have increased +35% over last year, for a total of 5,819. “Builders have started 7,715 homes in the past twelve months, which is an increase of +41%, compared to the annual pace last year at this time,” said Allen. Annual new home closings have increased +38% compared to last year at this time, for a total of 7,264. The market has closed 5,419 new detached homes over the past twelve months, which is a +40% increase over last year. Annual starts for attached housing has increased +66% over last year, with a total of 1,896 units. Annual new home closings are up +32% from last year, to 1,845.

As of June, the total new home inventory for detached homes totaled 2,837. While the total number of homes has increased +17%, the supply has dropped from a 7.5 months supply to 6.3 months. Under construction inventory is up +31% from last year and +11% from last quarter, however remains healthy with a 4.8 month supply. Finished vacant inventory has decreased -12% from last year, however increased 54 homes from last quarter. Despite the slight increase from last quarter, the supply of finished vacant homes remains well below equilibrium at a 1.1 month supply. “Despite their efforts, builders are having a difficult time delivering finished homes to the market as their specs tend to get purchased during construction,” said Allen. Total inventory for Attached homes totals 2,089, which is a 13.6 month supply, down from 17.5 recorded in 2Q12. Under construction inventory is up +26% from last year, or a 9.3 month supply, still within equilibrium. Finished inventory dropped -27% from last year, which at the current pace of absorption is a (low) 3.9 month supply.

The number of vacant developed lots for detached homes has decreased for 17 consecutive quarters to a level not seen since the first quarter of 2006. Lot supply now sits at 33.3 months, down from 52.3 at this time last year. While the overall supply is above equilibrium (18-24 months), there are noticeable lot shortages in specific submarkets across the market. Attached lot inventory is down -10% from last year at this time to a 22.5 month supply. This supply is down from the 41.6 months recorded last year at this time. There have been 4,597 new lots delivered to the market over the past year, while builders have absorbed 7,715 in the same time-period. “This signals that the oversupply of lots, particularly those in desirable areas is no longer a concern, with the focus now turned to delivering lots for future demand,” said Allen.

“As the housing market remains robust, the pace of year over year gains are expected to normalize.  However, the trend remains positive, and is expected to continue through the second half of 2013,” said Allen.

For information contact:
eric allen @ 801.571.7700 x424
email eallen@metrostudy.com

About Metrostudy

Metrostudy, a Hanley Wood company, is the leading provider of primary and secondary market information to the housing and related industries nationwide.  Established in 1975 in Houston, Metrostudy provides research, data, analytics and consulting services that help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day.  www.metrostudy.com

About Hanley Wood

Hanley Wood, LLC is the premier media, event, information and strategic marketing services company serving the residential, commercial design and construction industries. Through its operating platforms, the company produces award-winning digital and print publications, Newsletters, websites, marquee trade shows and events, Market Intelligence data and strategic marketing solutions. The company also is North America’s leading publisher of home plans.

Salt Lake’s new home market experiences growth in the first quarter

Posted in Salt Lake City Market | Posted on 04-25-2013 | Written by Metrostudy News

(Salt Lake City, UT – April 25, 2013) The Greater Salt Lake market continues to experience positive growth in the local economy and housing market, and is projected to remain strong throughout the year.  This is according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

According to the revised numbers released by the Bureau of Labor Statistics (BLS), the Greater Salt Lake market added 41,900 new jobs annually to the market as of March, 44,000 new jobs – which is a 4.3% growth rate, one of the highest in the nation. The BLS revised their employment numbers back to 2006, which have resulted in much stronger and consistent job growth, when compared to the previous numbers. The total number of people employed in the Greater Salt Lake market has now surpassed the highest level recorded, back in December 2007, by 2,300 people. As of March 2013, the unemployment rate sits at 5.3%, down from 6.0% recorded at this time last year. While the national unemployment rate also continues to decrease, the rate remains above healthy levels at 7.6%. “The Leisure & Hospitality sector took the lead in job growth with the addition of 8,300 new jobs in the past year. While this sector has not traditionally produced a lot of high paying jobs, it does signal that consumers are spending time and money in the travel,” said Eric Allen, regional director of Metrostudy’s Utah/Idaho Region.

According to Metrostudy’s quarterly survey of all new home projects in the Greater Salt Lake market, there were 1,659 new home started during the first quarter of 2013. This is a +34% increase over 1Q12, however down -4% from last quarter. Annually, builders have started 7,262 homes, which is a +54% increase compared to the annual pace of 1Q12. “The annual pace also increased +6% compared to last quarter. The consistent increase in new home production demonstrates a strengthening confidence level in both builders and consumers,” said Allen.  Quarterly closings totaled 1,761, up +30% compared to last year at this time and +7% from last quarter. Annual new home closings increased +33% compared to last year, for a total of 6,672.

As of the end of March, there were 2,603 new detached single family homes in inventory throughout the Greater Salt Lake market, up +30% from last year. Despite the increase, new home inventory rests on the low end of equilibrium at 6.3 months. The increase has come from homes under construction, which is up +53% over last year, which is currently a 4.8 month supply. “With closings increasing at such a rapid pace, it has left the market in short supply of available homes,” said Allen.  Finished vacant home inventory is at the lowest level recorded since Metrostudy entered the market in 2001. Total finished vacant home inventory is down -15% from last year, and another -9% from last quarter. Based on current absorption, this is only a 1.1 month supply. Total inventory for attached homes is nearly unchanged compared to last year, and is down only -.5% from last quarter. Currently, this is a 14.8 month supply, down 4.2 months from last year. Conversely, under construction inventory increased +24% over last year, and has a 9.5 month supply.

Vacant developed lot inventory for detached homes in the Greater Salt Lake market is down -14% from last year, and at the current pace of absorption translates to a 36.6 month supply, which is down from 63.6 months recorded at this time last year. While the overall lot supply appears to be above equilibrium, the market is experiencing a shortage in many “A”, “B”, and some “C” locations. Attached lot inventory is also declining, down -14% from last year, which is a 25.3 month supply based on the current absorption pace.   There have been 3,858 new lots delivered to the market over the past year, while builders have absorbed 7,262 in the same time period.

For information contact:
eric allen @ 801.571.7700 x424
email eallen@metrostudy.com

About Metrostudy

Metrostudy, a Hanley Wood company, is the leading provider of primary and secondary market information to the housing and related industries nationwide.  Established in 1975 in Houston, Metrostudy provides research, data, analytics and consulting services that help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day.  www.metrostudy.com.

About Hanley Wood

Hanley Wood, LLC is the premier media, event, information and strategic marketing services company serving the residential, commercial design and construction industries. Through its operating platforms, the company produces award-winning digital and print publications, Newsletters, websites, marquee trade shows and events, Market Intelligence data and strategic marketing solutions. The company also is North America’s leading publisher of home plans.

Salt Lake’s new home market expects growth in 2013

Posted in Salt Lake City Market | Posted on 02-04-2013 | Written by Metrostudy News

(Salt Lake City, UT – February 4, 2013) Much to the industry’s surprise, the Greater Salt Lake market exceeded expectations for 2012, with increased job growth, higher than expected new home production, and low home inventory levels. This is according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.

The Greater Salt Lake market ended 2012 with a surge in new jobs. While the market had increased job growth throughout 2012, the level of jobs was declining. However, the 4th quarter experienced a bounce and ended the year with approximately 29,000 new jobs created, as of December. The unemployment rate in the Greater Salt Lake market has fallen below the level considered to be “fully employed”.  “While the Greater Salt Lake market has maintained a lower unemployment rate than the nation, the gap is widening, signaling that jobs are easier to replace here compared to the nation as a whole,” said Eric Allen, director of Metrostudy’s Utah/Idaho Region.

According to Metrostudy’s yearend survey, there were a total of 6,892 new homes started during 2012, which is a 58% increase compared to 2011. During the 4Q12 there were 1,758 new starts, which is a 55% increase compared to 4Q11. While quarterly starts dropped -18% from 3Q12, this is a normal seasonal decline. The fourth quarter totaled 1,642 new home closings, which is a 45% increase compared to 4Q11. Quarter over quarter closings actually experienced a -12% decrease, which is most likely attributed to the rush of closings that occurred during 3Q12, or pre-election. “Consumer confidence in the market took a hit after the presidential election, and therefore put some buyers back on the sidelines for a short time,” said Allen.

New home inventory for detached product remains healthy at 7.1 months, or 2,731 homes. Under construction inventory has experienced a 57% increase compared to last year, and currently sits at 2,049, which is a 5.3 month supply. “With the rapid increase in sales, available inventory has remained low for the past few years, which has required builders to increase production in order to keep up with demand,” said Allen. Finished inventory has declined once again and remains at record low levels. There are currently only 499 finished detached homes on the ground, which at the current pace of absorption is a low 1.3 month supply. This total is down 12% from last year and another 7% from last quarter. Total inventory for attached homes is down 3% from last year at this time to 2,188 units, which is a 16 month supply. Under construction inventory has also increased, to 1,445 units, 21% more than last year.

“Positive trends are putting the market in a great position for more expansion as we move through the New Year. While nationally, there are some hurdles that will need to be conquered; the fundamentals in the local market are well in place, which will provide for more opportunities and growth in 2013,” said Allen.

For information contact:
eric allen @ 801.571.7700 x424
email: eallen@metrostudy.com

About Metrostudy

Metrostudy is the leading provider of primary and secondary market information to the housing industry and related industries nationwide. In addition to providing its own primary housing data for approximately 70% of the United States housing market, the company is recognized for its consulting expertise regarding real estate development, marketing and economic issues, and is a key source of research studies evaluating the marketability of residential and commercial real estate projects. Services are offered through an extensive network of offices located in major metropolitan areas throughout the U.S. For more information, visit www.metrostudy.com

01/24/13: State of the Wasatch Luncheon and Growth Report

Posted in Events, Salt Lake City Market | Posted on 01-03-2013 | Written by Eric Allen

eric aState of the Wasatch luncheon

The Northern Wasatch Home Builders Association announces its inaugural

State of the Wasatch Luncheon and Growth Report


11:30 a.m., Thursday, January 24, 2013
Meridian Room, Davis Conference Center
Layton, UT

Learn about the current condition
of the Northern Wasatch housing market
and how housing will combine
with Utah’s economic development efforts
to benefit the region in the next 12 months
from two of the region’s experts

Mr. Eric Allen – Director, Metrostudy
Ms. Sophia DiCaro – Deputy Director
Governor’s Office of Economic Development

Tickets are $25 for NWHBA members
$35 for non-members
To reserve your seat

call the NWHBA office at (801) 479-5230
Or e-mail Olivia@nwhba.net