Utah Home Values Plummet
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Just a couple of years ago, Utah was among the highest ranking real estate markets when it came to home appreciation. I know. I live in Utah. My cousin’s condo appreciated $20,000 in one year. Of course, all of that came crashing down just prior to the recession. AllBusiness.com reports on Utah’s fall from grace:
Utah’s comparatively low rankings contrast sharply with its stellar performance less than three years ago. The state first topped the nation in appreciation in the fourth quarter 2006 and remained at either No. 1 or No. 2, with double-digit annual increases in home values, until late 2007.
But by last year, smaller appreciation numbers gave way to no appreciation, and now, falling prices.
Interestingly, though, in a case of “real estate is local”, the city I live in actually saw an increase in home values. Indeed, Logan saw 0.7% increase in the past year. Which explains why the county assessor says my property taxes are heading higher.
Utah housing market suffers from mortgage market crash
Utahns have a reputation for thrift and for living within their means. However, it appears that, just like in other areas of the country, getting an “affordable” home “with one’s means” meant some fancy financing involving things like ARMs with teaser rates and interest only home loans. The enticing thing about these types of loans is that it appears as though you can by a home you can afford, but in reality you can’t. As you discover when the interest rate resets or you have to start paying on the principal. All of a sudden the payments are unmanageable. And you lose your home, and home values plummet as the market sees an excess of supply.
It is vital that you make sure you can afford a home and that you carefully consider the costs of home ownership before taking the plunge.
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August 29th, 2009 at 10:03 am
[…] recent housing market problems have led to a situation where home values have fallen far enough in some areas that it just doesn’t make sense to rent. While it still costs a […]