Greater St George Utah Real Estate Market Report for June 2018
Summer in St George is in full swing, and the only thing hotter is our St George Utah real estate housing market. Inventory remains low and sales are high, which contributes to this aggressive and fast paced real estate market. Here is a quick snapshot (photo below) illustrating the past two years, this graph offers insight and I’ll further analyze the status below. Also, if you’re interested in more specific statistics or reports I’ve missed, please offer your input—contact Paula Smith with RealtyPath directly and let me answer your questions.
The past two years are illustrated above; May has typically been a great month in sales as school is out and people are ready to make their move (Washington County Schools let out in May for Summer and we start up again early August). The coveted price point is, and has been, anything under $300,000. Homes priced $250,000 or less are nearly considered a prized possession and the competition can be impossible at this price point. There isn’t a lot of inventory, and the demand is always there especially for a turn-key ready home. It’s interesting to note that luxury homes are selling at surprisingly high rates too, which is an obvious sign of our economy as a whole. From March 2018 to June 15, 2018 there were 159 homes sold at $500,000 and above. 17 of these homes sold OVER 1 million (in the past 3.5 months). Comparatively, for the same period last year (2017) the number of homes sold over $500,000 (in the Greater St George area) was 123 sold homes (this is 29% less), and of those 11 were over 1 million.
St George Is One of The Fastest Growing Areas In the Nation
St George is among the fastest growing areas in the nation. Many areas across the nation are also experiencing home values increase, and higher price metro areas are allowing sellers to cash out and purchase more home for the money here in St George. Relocation is a large contributing factor to our sales and specifically to our high end sales. Additionally, people are making money, so “moving up” into a luxury home is possible, and buyers are taking advantage.
New Construction and Building a Home in St George
New construction in St George Utah is booming, specifically because buyers are having difficulty finding the home they want, so buyers are building to achieve their goals. New construction is ALWAYS more expensive when compared to resale homes. While a buyer may feel like they must build to get what they want, buyers on a budget will (at some point during the process) realize they will sacrifice what they want, for what they can afford. Unfortunately, many buyers realize this toward the end and they are unable to have key features they were searching for (backyard landscaping, pool etc…).
Builders have spec homes around town, a common complaint from buyers I work with is that the finish feels “cheap” and they’d like to align themselves with a better-quality builder. The truth is, most all of the builders are the same (actual producing more reputable builders is who I’m referring to—YES….there ARE builders you SHOULD AVOID). All builders purchase their material from the same places, typically they all receive similar discounts, and they all use the same sub-contractors. So there are not builders around that can build for significantly less (I promise---and if they tell you this….I promise it’s not true). Some builders can achieve some discounts and others may be better shoppers for value, allowing them to share marginal savings. The fact is, you get what you pay for. If you desire a model-like home featuring high end wood look tile plank flooring, fabulous lighting fixtures, and stunning staggered two tone painted kitchen and home cabinetry, with granite or quartz throughout, tile in all the bathrooms and tub surrounds---you’ve got to pay more. You can not build the model home you saw for less than a comparable resale, in fact….that model home you saw was likely built 8+ months ago so a buyer is unable to build that SAME home for the same price the builder did at that time. Local builders tend to use “cheap finishings” simply to keep the overall price in check. The buyer pool is larger for a price point of $350,000 (with less expensive finshings) than it is to sell a higher end home with high end finishings. Additionally, with a lower price point, builders will have lower carry costs. The time to build is quite extended right now, taking on average 9-12 months.
There are reputable builders in town, and those that are not. It’s important to work with a buyers agent, even if building a home. Some builder representatives around town have been telling buyers they will save money if they do not use an agent, the irony is that those representatives are actually agents themselves. Working direct with the builder is important for communication, but local buyers agents work to represent buyers and we can inform you of actual savings. I’ve been able to save my buyers by simply knowing what to ask for and where potential discounts can save, as opposed to the unknowing buyer being told only a fraction of their options. The builder/seller isn’t going to tell a buyer about the previous client who asked for a discount and received it.
From January to June 15, 2018 there have been roughly 380 new construction homes sold as compared to the same period in 2017 there were 310 new construction homes sold in St George (these numbers aren’t exact, but close).
Is Now a Good Time to Buy in St George Utah?
Overall, the Greater St George market is up approximately 4% in the number of residential sales when compared to the same period in 2017 (Jan-mid June) and the average sale price is up 11% (however keep in mind that the surge of higher end homes is skewing this number and should not be applied to the “average priced home”). Rising interest rates will likely cause a bit of a slow in rising home prices. My opinion is: prices will still trend upward, but it will likely be minimally and may likely flat line for a while (meaning pricing may stay close to where it is now). I do not foresee prices dipping as a result of rising interest rates, unless (or until) our inventory starts to increase. At this point, our inventory is slightly less as compared to the same period last year so I expect more of the same to continue through the end of the year. At year end or as we head into 2019, we may begin to see more inventory at which point there could be a shift in market. This is only speculation as my crystal ball batteries are on backorder with Amazon, for now, we wait and see.
If you’re looking to buy or sell in the St George area, I’d like to be the agent to help you. Please give me a call or send an email, Paula Smith RealtyPath St George.