Just released

Salt Lake County prices still moving up, but market is slowing with ‘Days on Market’ now 23. BETTER for buyers as sometimes you can actually go back for a second look before making an offer. BUT interest rates are now up to 6.5%

Tax Time

Property tax notices have been mailed to folks who own land, homes, commercial buildings, condos, etc. During mid-summer we get a notice from the County Tax Assessor where we live that shows what our property taxes were last year and what the Assessor intends to charge for the coming year. Folks are calling me to get comparable sales data from January of last year to show the Assessor how LITTLE their property is worth so they don’t get a major bump in property taxes. In Salt Lake County the average home value rose 28.7% over 2021. The Assessor didn’t raise my taxes by that amount, but it’s looking like I’m going to get an increase of about 20% over the previous year. YET, the value of my home is way under what it would be if we put it on the market today to sell. So, we’re winning the property tax game-for now.
Anyone can protest their property taxes. Do you have a chance battling the big bad gubmint? Actually, yes. I called a friend who used to work for the Assessor and they shared you might be able to get a bit off the proposed tax valuation BUT you must apply by September 15th with an application that has a current appraisal or comparable sales data attached to it. You can simply send it in (there’s a form/envelope included with the notice) or you can go in person to plead your case. IF you lose your protest you can appeal to the Utah State Tax Commission for a hearing, or argue your way all the way to the Utah Supreme Court.
Many people can’t pay their property taxes in one lump sum. You can talk to the Assessor’s office in your county to find out options for payments. They can’t take away your property until you have been delinquent for four years of non-payment. The county can sell your property to pay off the tax bill via a public auction, where the wining bid must equal at least the amount of the overdue taxes, penalties, interests and administrative costs. IF the County accepts the sale terms the winning bidder gets a tax deed as long as they pay the terms of the winning bid within a few days. Property owners can then file a claim to receive any amount paid to the county in excess of the property taxes plus interest.
Where do most of the taxes go, once paid? School districts, city services take up the most of your property tax money. If you are having trouble paying your taxes, there are several programs that can help if you are 65 or older ore getting disability benefits, income /assets less than $35,807, are blind or the unmarried spouse or minor of a deceased blind person, veterans with a service-connected disability or on active duty outside of Utah. For more information: slco.org/treasurer/tax-relief.

Crypto Buyers

The real estate business can be creative at times. It’s not always ‘write up an offer, get an inspection, and wait for the lender to send out an appraiser and finish your loan’ kinda thing. For example, I had friends (a social worker and a librarian) wanting to purchase their first home but had little in the bank for a down payment. Except…the husband had his original baseball card collection which had value. We went to a creative lender that I liked and presented the idea of buying a home with old printed pieces of cardboard, and the lender simply said “I think I can get you a loan, but let me talk to the underwriter”. So, a day later, the lender came back and said my buyers could use the cards as a down payment but would have to a) sell the cards for the appropriate amount for the down payment and b) provide a receipt for the sale. My buyers figured out what they needed to sell and we found them a great house where they still live today. If I recall, one of the cards was a Micky Mantle. A mint condition Mantle Card just sold last month for $12.6 million-the most ever paid for a sports memorabilia card and possibly the most for any kind of sports memorabilia to date. A Honus Wagner card recently sold for $7.25 million, which was the second highest amount for memorabilia in all of sports-so far. Something tells me that the legends of the all American game of baseball would not have minded that their faces were used to buy housing for first time buyers.
Clients I worked with presented a slightly different problem to me when they handed me a neatly wrapped piece of tissue paper to say they would use ‘emeralds’ as their earnest money and down payment. When I opened the tiny packet I saw ten green pieces of what looked like jujube’s (candy). I had no idea if they were real stones or their value, and neither did my broker. In this case, the seller of the home they wished to buy didn’t have a problem with them using emeralds but wanted assurance the stones were real and of value. My broker went to O.C.Tanner and had the gems appraised and they found that they did have appropriate value, which satisfied the seller.
I asked our favorite mortgage broker, Julie Brizzee with Intercap Lending, if a buyer could use cryptocurrency as a down payment. She replied, “It’s like selling a car for the down. I would have to provide documentation of value-an appraisal of value, then a bill of sale and receipt of funds.” My own real estate brokerage is not set up to accept cryptocurrencies as earnest money and regardless of that I would still have to prove a buyer’s earnest money (cash, check or wired funds) was valuable currency that could be transferred into an escrow account once the buyers offer was accepted

News and Notes

If you’re driving or taking TRAX from downtown SLC to the airport, you notice the massive Rocky Mountain Power triple stacks @1400 W. North Temple. They’ve been there for a long, long time-since the 1950’s.  More than 100 acres belong to RMP (a subsidiary of PacifiCorp) and the company has applied for a zoning change to tear down a bunch of old and decrepit buildings and replace them with a new headquarters that will hold about 700 employees. The more interesting news is that RMP envisions a mixed use development over time which they have dubbed ‘The Power District Campus’.  The construction will be environmentally correct for current standards and will of course be all-electric. After the new commercial buildings are completed, the company will hope to change more of it’s acreage into housing and businesses to create a ‘vibrant, mixed-use neighborhood.’  What’s crazy to think about is that this huge tract of land is about the size of downtowns Central Business District or slightly larger than the Sugar House business district so the possibilities for creative development are tremendous. The power plant that’s on the site is scheduled to be phased out by 2032.

Been to Arches lately? If you recall our state/national parks were overrun with visitors during the pandemic when flying was either banned to many areas around the world or just a plain pain the butt. In 2022 Arches went to a ‘entry reservation’ system from April to October. The park reported an increase in visitors of 66% from 2009 to 2019, and then was deluged with visitors once Covid-19 hit. People wanting to see the big red arches had to line up at 4 in the morning prior to the reservation system and other who came later in the day weren’t able to get into the park, as it was full. Other of our ‘Big 5’ experienced massive visitors but there are no reservations for riding the park shuttle or to enter Zion National Park. Utah’s five national parks reported a record 11.3 million visits in 2021, compared with 10.7 visits the previous years.  Arches reports that with the required reservation system visits have dropped this year which is probably due to the fact more people are stepping on planes to destinations beyond Utah.  Friend report that having a timed entry to the park was convenient and really cut down on chaos around some of the most visited arches.

Finally, Millcreek Canyon is getting massive road construction that’s going to narrow the road to one lane during weekdays.  They have to resurface the road and do work on the drainage system in the canyon this fall. For those of you who LOVE bike riding up Millcreek Canyon, find a new route/adventure as it will be closed for cyclists all summer long. Except, you can drive up, pay your tiny fee, and haul your mountain bike along to get to the trail head. If you plan on eating at the Log Haven or Millcreek Inn, they will be open, but expect delays to get there.

 

Scenic Utah

One of the best day trips out of Salt Lake City is to head southeast to 9 Mile Canyon outside of Price (actually, outside of Wellington). The canyon name is a misnomer-it is not nine miles long, it’s about 43 miles long from the highway, through the mountains and up to Duchesne before the road back to Park City/Salt Lake. It’s worth a stop after two hours or so in Helper at the Balanced Rock Eatery and Pub on Main Street for pancakes (all day!) bigger than the size of your head, burgers, sannies and dinner entrees. The little town has done a great job of changing from empty boarded up storefronts, saloons, and hotels to a little vibrant art community of @2500 residents.

Once you’re full as a tick it’s not far to the turnoff to the Canyon adventure. You can see thin layers of coal (it is Carbon County!) in the hills, smell fragrant cedar pines and sage brush, discover colors of earth from a light green to a sandstone red on your drive and best of all, the infamous petroglyphs along the roadside.  There’s the ‘coyote and the stars’ on a rock high above road (with markers to help see it), large ‘newspaper rocks’ of stories showing humanoids, sheep, deer, snakes, giant owls, and many dots in patterns that look like calendars. Sadly, A-holes of this century have scrawled their own graffiti alongside the precious Native art including adding vaginas and penises to some of the smaller human figures carved into the rock. It’s a felony and a bad Federal rap to damage any of these sites.

Scenic Utah is a 501(c)3 non-profit state-wide organization out to win my heart. They appreciate our history and our vistas around the state. These volunteers are out to educate us, the legislature and larger communities about protecting dark skies, scenic byways and help to ban new electronic billboards to reduce the light pollution that damage dark skies and help to ensure local governments keep rights to regulate and ban billboards of all kinds that are ‘intrusive eyesores that harm the visual environment, reduce property values and detract from community character.’  They appreciate as I do our visual environs. They have found that more than 75% of Utahns believe billboards are intrusive eyesores that harm the visual environments where they are located.

Having served as a volunteer Planning Commissioner for Salt Lake City for 8 years I got a hard and fast education on how powerful the billboard companies are and how difficult it is to get rid of a single one. You can go to scenicutah.org to find out more about their vision and purpose. Best of all, they are having a photo contest (Deadline is SEPT 1) with categories like ‘scenic night skies’, ‘my rural roots’, parks in towns and cities, ‘visual pollution we wish would go away’, ‘off the beaten path’ (remote or hard to reach places in our beautiful state), etc. to celebrate the vistas of this great state.

Affordable Housing

There’s good news for affordable housing coming to Salt Lake City!

First, if you haven’t driven on Foothill across from Research Park and Sunnyside (800 So) you’d miss all the construction going on at the west side of the road. It’s hard to miss since just about everywhere in the valley is a crane, bulldozer or hole being developed. This site is where a private entity (The Clark and Christine Ivory Trust), the Church of Jesus Christ of Latter-day Saints and the state/U of U are combining resources to put in four buildings with @550 apartments, and was formerly the original location of ‘married student housing’ for the school. The church is offering a ground lease for 99 years on the location for the two entities to develop and manage housing there. Second, the university and ‘Ivory University House’ is in the process of adding @1,700 housing units for students: 430 rooms at Kahlert Village, 775 beds in the Impact and Prosperity Epicenter and 504 units in the University West Village. All of the construction should be completed by 2024.

Third, and highly controversial, is Salt Lake City’s proposals for Affordable Housing Incentives. The Planning Division has done an extreme deep dive into researching housing issues that we’re facing in the capitol city and have put forth zoning amendments to encourage the construction of additional affordable housing buy incentivizing developers who include affordable homes in their projects. This wouldn’t be a requirement but if the developer did include affordable housing, then they might be able to get waivers on parking, height, setback and process waivers depending on the designs.

What’s controversial about affordable housing? The City is proposing to allow for multi-family units in single family neighborhoods. Picture the Harvard/Yale area around 1000 South and 1500 East, an area of precious mostly brick homes with historic architecture and landscape. Then imagine one of those homes being torn town and replaced with a four-plex that may have one or two units that could be rented to low income folks-people who earn less than $74,000 for a family of four.  Nimbys HATE this idea of rental housing and have been testifying in hearings and writing emails like crazy trying to stop more generous zoning. They don’t want greater height, or multi-family buildings nearby, or a reduction in side yards that might help squeeze in bigger structures. You’ll hear more about this during the summer as public input is a necessary step in the process of approval. The City does want you to speak up!

Also, the City is still trying to create opportunities for more ADU’s (think mini-homes). Our laws are outdated here for this trend in affordable housing and again, NIMBY’s oppose greater density in their neighborhoods. Ivory Homes has been battling Avenues residents for years to build homes at a project they call ‘Capitol Park Cottages’ at @675 N. F Street. Planning and Zoning approved of a rezone for them last week to build 19 single-family homes with 14 of them having ADU’s.

 

We’re Softening

What’s going on?  I held an open house and only two groups came through!  I listed a property and I’ve only had three showings!  Is the real estate bubble bursting?

Don’t wait for a popping sound, but the market is softening somewhat. Prices around the country in many areas have adjusted downward by an average of 5% and bidding wars are starting to slow as rising mortgage interest rates have increased to 5% or more. Realtor.com reported last month that home prices are moving south in Toledo, OH, Rochester, NY, Detroit, MI, Pittsburgh, PA, Springfield, MA, Tulsa, OK, LA, CA, Memphis, TN, Chicago, IL and Richmond, VA.  Trust me, this isn’t any repeat of the evil Great Recession when housing prices were out of control and within a year the bubble burst and prices plummeted across the country, with many foreclosures a direct result.   This small of a decrease doesn’t mean we’re headed for another crash and Utah sellers won’t feel that much pain during this inflation. Why?

  • We’ve got the best unemployment stats in the country with only 2% of Utahns without jobs, whereas the national rate is more like 3.6%.
  • More people are moving to Utah than leaving.
  • We still have very low real estate inventory for buyers to buy or renters to rent in the State.

The advantage now with the market softening is that buyers may actually have a chance at winning a bid rather than competing with 20 or more offers. Maybe now there might only be a handful of offers.

During the crash in 2008 we saw housing values decline almost 20% and yet in 2021 housing prices rose on average of 19% in one year. With the Coronavirus Housing Boom of renters wanting the security of owning their own nest and Millennials deciding to buy rather than rent we saw not just unholy increases in offering prices by homeowners but super low inventory. As our inflation keeps growing experts believe recession will follow, and when that happens, we usually see a collapsing housing market. That isn’t logical when there continues to be such a demand on housing inventory. Thus, don’t pee yourself to think the home you just bought is going to go down in value by 20% anytime soon.

Back in 2008 just about anyone could get a home loan and too many bought that really couldn’t afford to own and so when the economy crashed buyers lost jobs and couldn’t afford their mortgage payments which led to massive foreclosures around the country. Nowadays lenders are much tougher on buyers who now have to meet much more rigid credit and income requirements to qualify for a mortgage. There are very few foreclosures out there right now as seen by the HUD website’s list of available homes.

Don’t panic if you’re selling right now. You may be longer on the market, may need a price adjustment, but you will sell if you’re patient and have a good sales strategy.

BUY TIME

Buyers take note!  The real estate market is changing drastically, especially seen in new data from the Salt Lake Board of REALTORS. Homes sales (condos, single family) fell to just 1,344 in June in Salt Lake County. That’s the lowest they’ve been in June for a decade and 27% less sales than last year during June.

What does that mean for buyers? For the last three quarters homes were selling in just six days, but now the average ‘days on market’ is 21 days, with an average list price of $613,397 and an average sales price of $611,740. There is now three times the normal inventory of properties for sale than pre-pandemic numbers and that simply means that buyers finally have a chance to shop and maybe even return the next day to a property that hasn’t sold with 20 offers on it.

I just helped some sellers go under contract on their home after a three day negotiation battle. In order to sell to the interested buyers the sellers paid $12,000 in the buyers closing/mortgage costs and agreed to pay the buyers rent for 30 days after close of escrow as they await their new home to be finished so they can move. I have not seen seller’s pay closing costs in at least two years because our market heated up so fast with so much competition from buyers that it wasn’t a really a possibility. Now with the slow down buyers might be able to pay asking price and not $100,000 over ask!  Buyers might be able to negotiate seller concessions, like seller paying for a home warranty on behalf of the buyers for a year (@$600) on mechanical items in the home, mortgage costs (can be up to 2% of the loan amount), repairs and personal items such as washers/dryers, pool tables, snow blowers.

One of the biggest reasons the market has slowed is due to the Federal Reserve raising its rates which trickles down to higher mortgage rates for buyers. Thirty year loan interest rates were just above 6% a few weeks ago but have now dropped below 6%. The Fed will be meeting in another week and economists suspect it will raise interest rates by one percent which makes it more expensive for banks to borrow and thus interest rates on all kinds of consumer and commercial borrowing, including mortgage rates tend to go up. This is all necessary to try and cool inflation.

Inflation rose to 9.1% last week, the most since February of 1991. You certainly can feel that as airline fares rose 34.1%, new car prices by 11.4%, and food prices are rising 1% per month. Housing prices are falling around the country by an average of 5% and over 50% of the listings on the MLS in Salt Lake City have had price reductions in the past few weeks. If you gave up trying to find a home, you may want to get back into shopping…deals are out there again!

Affordable Housing Hope

First, if you haven’t driven on Foothill across from Research Park and Sunnyside (800 So) you’d miss all the construction going on at the west side of the road. It’s hard to miss since just about everywhere in the valley is a crane, bulldozer or hole being developed. This site is where a private entity (The Clark and Christine Ivory Trust), the Church of Jesus Christ of Latter-day Saints and the state/U of U are combining resources to put in four buildings with @550 apartments, and was formerly the original location of ‘married student housing’ for the school. The church is offering a ground lease for 99 years on the location for the two entities to develop and manage housing there. Second, the university and ‘Ivory University House’ is in the process of adding @1,700 housing units for students: 430 rooms at Kahlert Village, 775 beds in the Impact and Prosperity Epicenter and 504 units in the University West Village. All of the construction should be completed by 2024.

Third, and highly controversial, is Salt Lake City’s proposals for Affordable Housing Incentives. The Planning Division has done an extreme deep dive into researching housing issues that we’re facing in the capitol city and have put forth zoning amendments to encourage the construction of additional affordable housing buy incentivizing developers who include affordable homes in their projects. This wouldn’t be a requirement but if the developer did include affordable housing, then they might be able to get waivers on parking, height, setback and process waivers depending on the designs.

What’s controversial about affordable housing? The City is proposing to allow for multi-family units in single family neighborhoods. Picture the Harvard/Yale area around 1000 South and 1500 East, an area of precious mostly brick homes with historic architecture and landscape. Then imagine one of those homes being torn town and replaced with a four-plex that may have one or two units that could be rented to low income folks-people who earn less than $74,000 for a family of four.  Nimbys HATE this idea of rental housing and have been testifying in hearings and writing emails like crazy trying to stop more generous zoning. They don’t want greater height, or multi-family buildings nearby, or a reduction in side yards that might help squeeze in bigger structures. You’ll hear more about this during the summer as public input is a necessary step in the process of approval. The City does want you to speak up!

Also, the City is still trying to create opportunities for more ADU’s (think mini-homes). Our laws are outdated here for this trend in affordable housing and again, NIMBY’s oppose greater density in their neighborhoods. Ivory Homes has been battling Avenues residents for years to build homes at a project they call ‘Capitol Park Cottages’ at @675 N. F Street. Planning and Zoning approved of a rezone for them last week to build 19 single-family homes with 14 of them having ADU’s.

 

Utah Lake

The first peoples in Utah were the Fremont and the Anasazi and then later the Northern Shoshone, Goshute, Bannock, Paiute, and Ute peoples. Like the herds they followed for food, they migrated throughout the state during all types of weather. White explorers encountered these tribes throughout the 1700-1800’s. Fur trappers were the first whites to have discovered Utah Lake and in the mid-1800’s Mormons began using and settling around it’s east and west shores. Historians report that Brigham Young first sent a fishing party to the lake to see what species inhabited the water and then in 1850 established a permanent settlement near its shores named ‘Fort Utah’ (in honor of the Utes living there), then later ‘Fort Provo’ (after the well-known French-Canadian trapper, Etienne Proveau who first saw the lake in 1825).

Utah Lake is a freshwater lake on the west side of I-15 in Utah County, about thirty miles long and seven-ten miles wide. Over the years it has been known as Ashley Lake, Little Uta Lake, Utaw (correct spelling) Lake, and Laguna de Nuestra Senora de la Merced de Timpanogotiz. The most important use of the lake has always been to water crops and provide irrigation, and in the 1800’s water users wanted to make sure there was enough water in the lake for late season crop irrigation. In 1884-1885 Mormons got together and effectively set the level of the lake to control water use. Fast forward sixty some odd years and Utah Valley saw the creation of a $200 million steel plant financed by the federal government to make sure that there would be enough steel to meet the military needs for supply. The plant opened in 1944, three years after the Japanese attached Hawaii. The plant operated for two years as a government facility and then was sold to U.S Steel for $47.5 million. It closed in 2001, the blast furnaces used to melt the product were demolished in 2005 and then in 2017 the master-planned community of ‘Vineyard’ was announced. In 2020 the new city was the fastest growing place in America, which had a growth rate of 10,687%.

Now developers have produced a grand plan to built islands in the lake for a mixed use of housing and businesses. The legislature is looking at a myriad of bills about water use and Utah Lake, including one to create an agency to oversee the management of Utah Lake. While elected officials try to figure out how to save on water use during this decade’s long drought and to get more water to the endangered Great Salt Lake, developers (“Lake Restoration Solutions”) want to dredge the bottom of the lake so they can build thirty-four islands. They would get out sludge made up of decades of sewer and industrial waste at the bottom which could turn the notorious white, murky waters of Utah Lake into something cleaner. Readings throughout the summer of water quality there are often bad enough to close beaches. The Utah Legislature ends March 4th.