Are we in another 2007 real estate bubble?
The quick answer is no. Back in 2007, there were 15,000 homes for sale along the Wasatch Front and over 6,000 developed building lots. Worse, every month thousands of homes came on the market but only 1,000 homes sold every month. That is, 2007 (and 2008, and 2009, and so on until 2012) saw high supply and very low demand.
Fast-forward to today: There are only about 1,000 homes for sale along the Wasatch Front and 100 or so developed building lots, but every month we see about 2,000 sales.
That is, 2021 saw ver high demand and very low supply.
At the beginning of 2020, the number of new listing far exceeded the number of sold listings. By the end of the year, sold listings passed new listings. Much of 2021 also followed 2020’s pattern–new listings outweighed sold listings, but by the 4th quarter, sold listings once again exceeded sitting inventory.
Putting it all together, you can clearly see that demand outstrips supply. Because demand was high and supply was low, 2021 saw a dramatic increase in sold price compared to 2020.
Once again, 2021 saw very high demand and very low supply. Thus, until we see much higher supply or much less demand (and neither appears to happen anytime soon), 2022 sill have the same unbalanced market as 2021.
One helpful note: prices aren’t predicted to rise more than about 8% in 2022.
Stay tuned for more information!