DAVE & DUJANOVIC

Rising interest rates put homes out of reach for 2 of 3 Utah families

Mar 15, 2022, 4:04 PM | Updated: Jun 14, 2022, 9:13 am
Utah airbnb rentals rising interest rates affecting millennial home buyers...
Eviction filings in Utah are on the rise. According to the Rental Housing Association of Utah, there has been a 46% increase in evictions in the first six months of this year compared to the same time in 2021.

Sound up for live discussion on Dave and Dujanovic!

SALT LAKE CITY — As interest rates are expected to begin rising this week, more and more Utah families are watching their dream of owning a home fade. 

As the nation’s average 30-year fixed mortgage rate has risen closer to 4%, a striking 67% of Utah households are being “priced out” of the state’s median-priced home, according to the calculations of Dejan Eskic, a senior research fellow at the University of Utah’s Kem C. Gardner Policy Institute who specializes in housing research.

“It’s bad,” he told Deseret News on Wednesday. “Typically when we see rates rise we do see a slowdown in demand. We see a slowdown in price. Sometimes the price actually falls,” Eskic said.

But in today’s market, don’t expect home prices to fall, he said.

Utah’s median-priced, single-family home was $512,000 statewide in the fourth quarter of 2021, according to the National Association of Realtors.

In January 2022, about 3,051 homes were sold in Utah, down 7.2% from the last January, according to a report published by the Utah Association of REALTORS.

‘Ropes of sand’

Utah real-estate agent Michael McPhie joined KSL NewsRadio’s Dave Noriega and Debbie Dujanovic to discuss what rising interest rates mean for homebuyers and homeowners.

Citing a Board of Realtors report, Debbie said, “The income required to buy a median-priced home in Salt Lake County — ready for this? — $58,000 seven years ago. Now it is over $101,000, ” adding the report states that “Utah is the only state since 1900 or homeownership the homeownership rate has fallen below 60%.” 

“What that tells me is what you could afford on one salary, you now have to have two salaries in the home to afford one,” Dave replied.

“It feels as though our kids are going to be grasping at ropes of sand to get that home,” Debbie said.

More homes being built to ease demand

McPhie said it’s a tough market for homebuyers but also for renters.

“Renters are obviously having a hard time transitioning. About three quarters of renters are priced out,” he said.

McPhie said the good news is new homes are being constructed to help alleviate the supply problem, but “not nearly enough.”

To buy a home today in Utah “is there anything folks can do or is it just suck it up and pay what it costs?” Dave asked.

“I hate to do a shameless plug, but I’ve had to resort to really starting to contribute some of our commission towards our clients to help them cover closing costs,” McPhie said. “We’re having to get really creative with our buyers to get their offers accepted.”

‘Perfect storm’ in Utah real-estate market

“Is there any silver lining at all?” Debbie asked.

McPhie again mentioned new home construction adding to the needed supply of housing units.

“We’re still going to see double-digit home appreciation this year. I don’t really see that changing. I mean Utah’s was kind of a perfect storm here as far as good economy, decent wages and great to come here and grow a business,” he said. “All those things combined with the influx of out-of-state traffic is just really putting super-high pressure on.”

Dave & Dujanovic can be heard weekdays from 9 a.m. to noon. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app, as well as Apple Podcasts and Google Play.

Today’s Top Stories

Dave & Dujanovic

Rioters at the US Capitol...
Curt Gresseth

Utah bill would limit police access to your cellphone data

A spokesman for a a libertarian think tank in Utah discusses why he supports a bill at the Legislature limiting law enforcement access to the cellphone of a person near a crime scene.
9 days ago
rollercoaster lagoon...
Curt Gresseth

Lagoon spokesman explains big price hike for day pass

Lagoon announces Primordial, a new one-of-a-kind interactive rollercoaster, coming in 2023, but with the new ride comes higher season passes.
12 days ago
Police provided an update but added little new information about four University of Idaho students ...
Curt Gresseth

Police stay quiet after quadruple homicide in Idaho

A killer is on the loose, police in Moscow, Idaho, are tight-lipped and a community is on edge after four university students were found slain Saturday.
13 days ago
A Utah psychiatry expert joined KSL NewsRadio's Dave and Dujanovic to discuss how friends and famil...
Curt Gresseth

Setting boundaries on a friend or family member’s addiction

Instead of boundaries that look like giving in or cutting off the person with an addiction, one Utah expert suggests seeking middle ground.
13 days ago
Being involved with a bad financial advisor is no good for investors. A KSL investigative reporter ...
Curt Gresseth

Do you know how to spot a bad financial advisor?

Spotting a bad financial advisor is easier if you know which red flags to look for.
14 days ago
A member of the Utah Taxpayers Association weighs in on how Salt Lake County will spend an 85 milli...
Curt Gresseth

SLC voters OK $85 million parks and trails bond. Is it worth higher taxes?

The Utah Tax Payers Association offers insight into the parks and trails bond and breaks down what the money will fund.
15 days ago

Sponsored Articles

Happy joyful smiling casual satisfied woman learning and communicates in sign language online using...
Sorenson

The best tools for Deaf and hard-of-hearing workplace success

Here are some of the best resources to make your workplace work better for Deaf and hard-of-hearing employees.
Team supporters celebrating at a tailgate party...
Macey's

8 Delicious Tailgate Foods That Require Zero Prep Work

In a hurry? These 8 tailgate foods take zero prep work, so you can fuel up and get back to what matters most: getting hyped for your favorite
christmas decorations candles in glass jars with fir on a old wooden table...
Western Nut Company

12 Mason Jar Gift Ideas for the 12 Days of Christmas [with recipes!]

There are so many clever mason jar gift ideas to give something thoughtful to your neighbors or friends. Read our 12 ideas to make your own!
wide shot of Bear Lake with a person on a stand up paddle board...

Pack your bags! Extended stays at Bear Lake await you

Work from here! Read our tips to prepare for your extended stay, whether at Bear Lake or somewhere else nearby.
young boy with hearing aid...
Sorenson

Accommodations for students who are deaf and hard of hearing

These different types of accommodations for students who are deaf and hard of hearing can help them succeed in school.
Young woman receiving laser treatment...
Form Derm Spa

How facial plastic surgery and skincare are joining forces

Facial plastic surgery is not only about looking good but about feeling good too. The medical team at Form Spa are trained to help you reach your aesthetic outcomes through surgery and through skincare and dermatology, too.
Rising interest rates put homes out of reach for 2 of 3 Utah families