Salt Lake Realtor June 2014 by Mills Publishing Inc.

Salt Lake

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slrealtors.com

June 2014 March 2012

New Homes in Short Supply p. 15

Where Do You Spend Your Marketing Dollars? p. 20 Home-Price Growth Slows in Q1 p. 22

A N NUA L R E A LTOR ® DAY

LAKESIDE BRUNCH TUESDAY, JULY 29, 2014 • 8:30-NOON

Join Us for Brunch and a Sneak Peek of Five Innovative Parade Homes in Daybreak

Sou

LOCATION Daybreak’s Brookside Park 4860 Dock Street (10500 S.)

10600 South i gh w a y ge r t e r H B an

Special Pricing

Crosswater Rd

Oquirrh Lake Rd

QUESTIONS Barbara Breen at Daybreak 801-204-2844 Email: Barbara.Breen@riotinto.com Or: Contact the SLBR at 801.542.8840

Lake Ave

RSVP for the REALTOR Day Brunch to the Salt Lake Board slrealtors.com by July 24, 2014.

rda th Jo n Pkw

11400 South

SL Board of REALTOR® ticket pricing day of event only.

$8 each | $7 10 or more tickets | $6 50 or more tickets

EQUAL HOUSING OPPORTUNITY

The future is now.

“We are proud to represent Berkshire Hathaway HomeServices, a brand inspired by the world’s most respected corporation according to Barron’s. As Berkshire Hathaway HomeServices, we will drive performance and profitable growth both locally and globally, long into the future. Our conversion begins a new era for our company and for residential real estate in Utah, and we look forward to building on our tradition of superior client service under our new brand.” ~ Stephen C. Roney Chairman and CEO, Berkshire Hathaway HomeServices Utah Properties.

The Sign of Confidence. © 2014 BHH Affiliates, LLC. An independently owned and operated subsidiary of HomeServices of America, Inc., a Berkshire Hathaway affiliate, and a franchisee of BHH Affiliates, LLC. Berkshire Hathaway HomeServices and the Berkshire Hathaway HomeServices symbol are registered service marks of HomeServices of America, Inc. Equal Housing Opportunity.

Golf Tournament Raises More Than $20,000 for Realtor® Political Action Committee (RPAC)

Table of Contents Features 12

Tee Off for RPAC Golf Day

New Home Construction Needed to Match Job Creation, Improve Affordability in Majority of U.S.

NAR: Many Realtors® Spend Their Marketing Dollars in the Wrong Places Bernice Ross Inman News

Home-Price Growth Slows in Many Metro Areas during First Quarter

Columns 7

Giving to our Community Angie Domichel Nelden – President’s Message

Departments 8

Happenings

In the News

Housing Watch

Realtor® Connections

On the Move

On the Cover: Photo: Dave Anderton Photo left: Dave Anderton

This Magazine is Self-Supporting

Salt Lake Realtor® Magazine is self-supporting. The advertisers in this magazine pay for all production and distribution costs. Help support this magazine by advertising. For advertising rates, please contact Mills Publishing at 801.467.9419. The paper used in Salt Lake Realtor® Magazine comes from trees in managed timberlands. These trees are planted and grown specifically to make paper and do not come from parks or wilderness areas. In addition, a portion of this magazine is printed from recycled paper.

Salt Lake

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June 2014 volume 74 number 6 The Salt Lake REALTOR® (ISSN 2153 2141) is published monthly by Mills Publishing, located at 772 E. 3300 South, Suite 200 Salt Lake City, Utah 84106. Periodicals Postage Paid at Salt Lake City, UT. POSTMASTER: Send address changes to: The Salt Lake REALTOR,® 772 E. 3300 South, Suite 200 Salt Lake City, Utah 84106-4618.

Rates are bouncing around. Lending guidelines won’t hold still. Making it to the closing table on time can be a wild ride if you aren’t with a steady, dependable lender. Live in a world of smooth transactions. 801.838.9808 | LOANS@SNMC.COM | 6965 UNION PARK CENTER | COTTONWOOD HEIGHTS, UT 84047 SECURITYNATIONAL MORTGAGE COMPANY | NMLS# 3116 | WWW.SNMC.COM

Salt Salt Lake Lake

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® ® ®

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President Directors Managing Editor Angie Domichel Nelden Dave Anderton Cheryl Acker Coldwell Banker Residential

At Home Realty

Copy Editor

M. Brock Andersen First Vice President Georgia Cuthbert Prudential Utah Real Estate Dave Robison Communications Committee Jared Booth Robison & Co. Coldman Banker Lori Lee – Chairwoman Annie Hedberg – Vice Chairwoman Tom Colemere Second Vice President Colemere Realty Publisher Troy Peterson Inc.Linda Geer Equity Real Estate Mills Publishing,Coldwell Banker Residential www.millspub.com Shirley Jacobson President Sales StaffReal Estate Treasurer Windermere Miller Paula Bell Adam Dan Kirkham Lisa Jungemann Kirkham Real Estate Bill LinesReal Estate Windermere Office Administrator Karen Malan Cynthia Bell Snow Tony Ketterling Paul Nicholas Past President Equity Real Estate Art Director Don Nothdorft Dave Frederickson Mike Morgan Jackie Medina Keller Williams Keller Williams Administrative Assistant Magazine Designer ChloéMichael Herrman Rowe Erin Tripp CEO Prudential Utah Real Estate Office Assistant Curtis Bullock Graphic Design SharonSnow Spratley Jessica Prudential Utah Real Estate Erin Tripp Ken Magleby Patrick Witmer Advertisinginformation informationmay maybe beobtained obtainedby bycalling calling Advertising (801)467-9419 467-9419ororby byvisiting visitingwww.millspub.com www.millspub.com (801)

Managing Editor Directors President DeAnna Dipo Dave Anderton Cheryl Acker Distinctive Properties

At Home Realty

First Vice President Publisher Jillinda Bowers Purdential Utah Donna PozzuoliMills Publishing, Inc. Daniel Christensen Prudential Utah www.millspub.com Coldwell Banker

Second Vice President President Sarah M. Colbert Dave Frederickson Dan Miller Summit Sotheby’s Keller Williams Art Director Tom Colemere Treasurer Jackie Medina Colemere Realty Charlotte Thomas Kim Farber-Lynch OfficeEquity Administrator Graphic Design Keller Williams Real Estate Cynthia Bell Snow Leslie Hanna Lisa Hyte PastKen President Magleby RE/MAX Canyons Office Assistant Bill Heiner Patrick Witmer JessicaJacobson Snow Shirley RE/MAX Associates

Sales Staff Chief Executive Officer Paula Bell Bryan Kohler Jim Copeland Karen Malan Paul Nicholas

Windermere

Administrative Assistant Fred Law Kyrsten Holland Law Real Estate Angie Domichel-Nelden Coldwell Banker

Troy Peterson Equity Real Estate

Salt Lake Board: Salt Lakee-mail: Board: e-mail: Web Site: Web Site:

Giving to Our Community

(801) 542-8840 (801) 542-8840 dave@saltlakeboard.com dave@saltlakeboard.com www.slrealtors.com www.slrealtors.com

The Salt Lake Board of REALTORS® is pledged to the letter and spirit of U.S. policy ® for the equal housing opportunity the nation. We is pledged to thethroughout letter and spirit of U.S. policy The Saltachievement Lake Board ofofREALTORS encourage and support the affirmative advertising throughout and marketing for the achievement of equal housing opportunity the program nation. Wein which thereand are support no barriers obtaining advertising housing because of race, color, religion, encourage thetoaffirmative and marketing program in sex, handicap, familial or national origin. which status, there are no barriers to obtaining housing because of race, color, religion, sex, handicap, familial status, or national origin. The Salt Lake REALTOR® is the monthly magazine of the Salt Lake Board of REALTORS®. Opinions ® persons quoted in articles are their own and do not necessarily expressed by writers is the monthly magazine of the Salt Lake Board of REALTORS®. Opinions The Salt Lake REALTORand reflect positions of theand Saltpersons Lake Board of REALTORS expressed by writers quoted in articles®. are their own and do not necessarily reflect positions of the Salt Lake Board of REALTORS®. Permission will be granted in most cases, upon written request, to reprint or reproduce articles well and photographs this issue, provided proper is given to The Salt Lake REALTOR®, as Permission will beingranted in most cases, uponcredit written request, to reprint or reproduce articles ® as any writers and photographers whose names appear withtothe andREALTOR photographs. , as well andtophotographs in this issue, provided proper credit is given Thearticles Salt Lake While unsolicited original manuscripts and photographs related to the real estate profession as to any writers and photographers whose names appear with the articles and photographs. are welcome, no payment is made for their in the publication. While unsolicited original manuscripts and use photographs related to the real estate profession are welcome, no payment is made for their use in the publication. Views and opinions expressed in the editorial and advertising content of the The Salt Lake ® ® not necessarily by theand Saltadvertising Lake Board content of REALTORS REALTOR Views andare opinions expressedendorsed in the editorial of the. However, The Salt Lake advertisers do not make publication of this magazine so consideration products and necessarily endorsed by the Saltpossible, Lake Board of REALTORS®.ofHowever, REALTOR® are services listed greatly appreciated. advertisers doismake publication of this magazine possible, so consideration of products and services listed is greatly appreciated.

n Friday, June 27th the Salt Lake Board of Realtors® will host its annual Charity Gala event (formerly known as Shrimpfest). Now in its 29th year, this event includes a seated dinner and live auction, and benefits two ideal causes – The Road Home homeless shelter and The Christmas Box International. Proceeds from this event are split evenly between these two organizations.

Why does the Board sponsor this event? The answer is simple. As part of its four-fold mission, the Board is dedicated to providing community service. These two organizations were chosen by the Board because of their unique housing-centered focus and dedicated work in helping children and families. For most of us, owning a home is something we take for granted. However, many individuals right here in Utah sometimes find themselves in desperate situations with no family to turn to and no resources. For these individuals The Road Home provides emergency housing shelter. Emergency shelter is a community safety net for people when no other options are available. Last year the shelter provided a place to stay for nearly 7,000 individuals (including more than 1,200 children). The Road Home adheres to a simple philosophy. “Families and individuals can more effectively address the issues that have led them into homelessness when they are in stable, long-term housing with access to supportive services.” To this end The Road Home works to rehouse families who are experiencing a one-time episode of homelessness and also create permanent housing opportunities for people who are experiencing long-term or chronic homelessness. The second cause is The Christmas Box International. In too many instances, children find themselves as the victims of bad choices made by their parents. In these cases, The Christmas Box International works to prevent child abuse and to improve the quality of life for children who have been abused or neglected. Each Christmas Box House serves as a one-stop assessment center for abused and neglected children, from infants through children up to the age of 18. Children in our care receive mental, emotional, and physical care in a home-like, loving environment. I encourage each of you attend this year’s Charity Gala and support our community. Tickets are $85 per person and can be purchased at slrealtors.com. Thanks for your generous support.

Angie Domichel Nelden 2014 President

OFFICIAL PUBLICATION OF THE OFFICIAL PUBLICATION OF THE SALT LAKE BOARD OF REALTORS ®® SALT LAKE BOARD OF REALTORS REALTOR is a registered mark which identifies a professional in real estate who subscribes ®

® . toREALTOR a strict®Code of Ethics asmark a member of the NATIONAL ASSOCIATION REALTORS is a registered which identifies a professional in realOFestate who subscribes to a strict Code of Ethics as a member of the NATIONAL ASSOCIATION OF REALTORS®.

October 2005

Salt Lake Realtor® June 2014

Happenings Broker Town Hall Focuses on Economy

Pictured: Curtis Bullock, CEO of the Salt Lake Board of Realtors®, Derek Miller, president and CEO of World Trade Center Utah, Chris Kyler, CEO of the Utah Association of Realtors®, and Justin Allen, director of government affairs for the Salt Lake Board of Realtors®.

The Salt Lake Board of Realtors® and Utah Association of Realtors® recently hosted a special Broker Town Hall discussion on new housing development, mortgage lending and the state of Utah’s economy. Speakers included: John Evans (Okland Construction); Brad Baldwin (First Utah Bank); Christina Oliver (Salt Lake County Business and Economic Development); and Derek Miller (president and CEO of World Trade Center Utah).

RealtyPath Announces Merger

RealtyPath celebrated its merger with Home and Family Realty and Oakview Realtors® at a special annual awards luncheon held in May. The brokerage plans to open additional branches in St. George and Park City. Realtypath recently implemented a simple program to help agents when they want to make RPAC donations from their commission checks.

U.S. Pending Home Sales Up Pending home sales improved for the second straight month in April, according to the National Association of Realtors®. Gains in the Midwest and Northeast offset declines in the West and South. The Pending Home Sales Index,* a forward-looking indicator based on contract signings, increased 0.4 percent to 97.8 in April from 97.4 in March, but is 9.2 percent below April 2013 when it was 107.7. Lawrence Yun, NAR chief economist, expects a gradual uptrend in home sales. “Higher inventory levels are giving buyers more choices, and a slight decline in mortgage interest rates this spring is raising prospective home buyers’ confidence,” he said. Yun projects the 30-year fixed-rate mortgage to trend up and average 5.5 percent next year.

Salt Lake Realtor® June 2014

In the News Foreclosures Falling; Auctions Up in Utah RealtyTrac® reported that foreclosure filings (default notices, scheduled auctions and bank repossessions) were reported on 109,824 U.S. properties in May, a 5 percent decrease from the previous month and a 26 percent decrease from May 2013. The report also showed one in every 1,199 U.S. housing units with a foreclosure filing during the month. In Utah, one of every 1,278 housing units had a foreclosure filing in May. The report noted that U.S. foreclosure auctions were at their lowest level since December 2006, but up in 16 states. Lenders scheduled foreclosure auctions for 47,085 U.S. properties in May, down 4 percent from the previous month and down 22 percent from a year ago to the lowest level since December 2006 — an 89-month low. Florida, Maryland, Nevada, Illinois, and Ohio posted the top state foreclosure rates. Florida posted the nation’s highest state foreclosure rate for the eighth consecutive month. One in every 436 Florida housing units had a foreclosure filing in May, nearly three times the national average. Despite the national decrease, scheduled foreclosure auctions increased from the previous month in 27 states and was up from a year ago in 16 states, including the following: Utah: up 199 percent, the 12th consecutive month with an annual increase; Oregon: up 157 percent, the 11th consecutive month with an annual increase; New Jersey: up 70 percent to the highest level since July 2010 — a 46-month high; and Massachusetts: up 43 percent to an eight-month high.

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Tee Off for

RPAC Golf Day The Salt Lake Board of Realtors® hosted more than 150 golfers on June 5th at its annual Tee Off for RPAC Golf Tournament. The event helped raise more than $20,000 for the Realtor® Political Action Committee. “The event was a huge success thanks to our participants, sponsors, and the tremendous efforts of members of the Government Affairs Committee,” said Justin Allen, director of government affairs for the Salt Lake Board of Realtors®. “We sold out all of our foursome-spots and we had great support from our sponsors.” Committee members included: Greg Fabiano, Becky Grubel, Hazelle Bretzing, Dan Taylor, Linda Itami, Mike Lasater, Michael Young, Bill Barry, and Rochelle Owens. The top men’s scoring team was the George Richards team. The top mixed team was the Brandon Hatfield team.

Pictured (top clockwise): Golf carts line the road in anticipation of the shotgun start. Tiffany Hull (D.R. Horton) and Heather Heine (D.R. Horton) handed out t-shirts and hosted the drink cart. Rochelle Owens (Influence Real Estate) and Jim Lyman (Guaranteed Rate). Mimi Roberts (Praedo Institute), Angie Domichel Nelden (president of the Salt Lake Board of Realtors®) and Michael Rowe (Berkshire Hathaway Home Services). Opposite Page (top left clockwise): Jill Kinder, left, (Exit Realty Plus), Hazelle Bretzing (U.S. Title), Shauna Judd (Axiom Financial), and Sylvia Farrar (KW Realty). Rylee Zylstra (Axiom Financial) and Stacey Abbott (Coldwell Banker Residential). Group shot on the green with Kye Pope, left, (CEO of Equity Real Estate), Dave Anderton (communications director of the Salt Lake Board of Realtors®), Angie Domichel Nelden (president of the Salt Lake Board of Realtors®), Curtis Bullock (CEO of the Salt Lake Board of Realtors®) and Michael Rowe (Berkshire Hathaway Home Services). Angie Domichel Nelden (Coldwell Banker) prepares to tee off. Kreg Wagner (legal counsel for the Utah Association of Realtors®) and Peter J. Christensen (legal counsel for the Utah Association of Realtors®). Sally Domichel, Ryan Kirkham (Kirkham Real Estate), and Angie Domichel Nelden (Coldwell Banker).

Salt Lake Realtor® June 2014

Photos: Dave Anderton

Salt Lake Realtor速 June 2014

The Salt Lake Board of Realtors速 Thanks its RPAC Golf Sponsors!

Jim Lyman 801.651.0050

PRAEDO

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Aaron Rigby 801-688-9800

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New Home Construction Needed to Match Job Creation, Improve Affordability in Majority of U.S. New home construction is underperforming in 32 states, including Utah, and the District of Columbia New home construction activity is currently insufficient in most of the U.S., and some states could face persistent housing shortages and affordability issues unless housing starts increase to match up with local job creation, according to new analysis by the National Association of Realtors®. The labor market, which is a key to overall economic health, has recovered all of the eight million jobs lost since the recession. NAR measured whether new home construction has kept up with job creation to determine the impact of construction on housing supply. The findings reveal that new home construction is underperforming in 32 states and the District of Columbia. Lawrence Yun, NAR chief economist, says there’s a strong relationship between new jobs and an increase in demand for housing. “Historically,

there’s one new home construction for every oneand-a-half new jobs,” he said. “Our analysis found that a majority of states are constructing too few homes in relation to local job market conditions. This lack of construction has hamstrung supply and slowed home sales.” NAR analyzed jobs created in every state and the District of Columbia over a three-year period ending in the first quarter of 2014 relative to new singlefamily housing starts over the same period. Indicating lagging new home construction, 33 states (including the District of Columbia) have a ratio greater than 1.5 – the long-term average. The disparity was the greatest in Florida, Utah, California, Montana and Indiana, where job creation has been particularly strong. Yun cautions that these (continued on page 18)

Salt Lake Realtor® June 2014

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“The disparity was the greatest in Florida, Utah, California, Montana and Indiana, where job creation has been particularly strong. These states could face persistent housing shortages and affordability issues unless housing starts increase to match local job gains.” states could face persistent housing shortages and affordability issues unless housing starts increase to match local job gains. “A persistent lag in new home construction will lead to faster home price growth, which will negatively impact housing affordability,” said Yun. Additionally, Realtors®’ home price growth expectations in the first quarter of 2014 was generally strongest in states facing housing shortage conditions. Lack of inventory has pushed prices up and put pressure on affordability – especially for first-time home buyers. “Realtors® have an intuitive sense of how fast prices are likely to rise from on-the-field observations,” said Yun. “Their price outlook largely shows gains to be the strongest in states with slow home construction in relation to job growth.”

On the contrary, home price growth looks to be manageable in states with strong job gains and near commensurate increases in new home construction. Housing starts are seen as more than adequate to local job growth in Mississippi, Arkansas, Connecticut, Alabama and Vermont. Inventory of homes sale and new construction drives supply. Although the number of existing-homes for sale increased in April, it remains historically-low, averaging six months or less for 20 consecutive months. Looking ahead, Yun says homebuilders will have to produce amidst the current challenges facing the building market. Limited access to credit for smaller builders, rising construction costs, concerns about the re-emergence of entry-level consumers to the market in the face of student debt and a tight credit box, and the general decline in affordability and purchase power over the last year is causing hesitation among builders. “It’s critical to increase housing starts in these states facing shortage conditions or else prospective buyers may struggle with options and affordability if income growth cannot compensate for rising home prices,” said Yun. The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

FREE EVENT! EVENT LOCATION: 5361 W. Meadowside Dr. (13200 South) Herriman UT, 84096

REALTOR DAY FIRST ANNUAL CHEF’ ON PARADE ®

RSVP: For the REALTOR® DAY at slrealtors.com by July 24th, 2014

TUESDAY, JULY 29 , 2014 5:00 - 9:00 TH

QUESTIONS:

Join Us For Food and a Sneak Peek of 4 Parade Homes in the Herriman Towne Center Event

Brendon Tingey. Phone: 801-316-3255 Email: brendon@mdevg.com Or: contact the SLBR at 801-542-8840.

Indulge in Some Delicious Food Truck Eats

DISCOUNT PARADE TICKETS AVAILABLE

SL Board of REALTOR® Ticket Pricing ( day of event only )

THE VIP TOUR

8 7

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Everyone that comes gets one free parade of homes ticket. ( while supplies last. )

For An Exclusive Tour Of Custom Homes Outside HTC Featuring Professional Chef’s

Contact Salt Lake HBA: 801.748.4134 . Ashley@slhba.com. $50 Per Person w w w . H e r r i m a nTo w n C e n t e r . c o m

Salt Lake Realtor® June 2014

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NAR: Many Realtors® Spend Their Marketing Dollars in the Wrong Places Survey finds floor time generates almost as many closed seller leads as websites By Bernice Ross Inman News The National Association of Realtors®’ 2014 Home Buyer and Seller Generational Trends report is packed with must-have knowledge for any real estate professional who wants to generate the best return on his marketing dollar. Where should you be spending your money? Are you spending thousands of dollars each year on search engine optimization, Facebook ads or other types of Internet advertising? How much do you spend each year on direct mailing, newspaper ads, calendars and magnets? If you are spending heavily in these areas, you may seriously want to reconsider whether the return justifies the costs. In fact, you may be wasting

Salt Lake Realtor® June 2014

valuable marketing dollars that would be better spent elsewhere. Surprising findings: Where do sellers find their listing agents? Because listings are in short supply, agents are being much more aggressive about advertising. According to the NAR report, however, many agents are spending their marketing dollars in the wrong places. Consumers and agents both agree that having a Web presence is absolutely necessary. With all the millions of real estate dollars being spent in this area, however, did you know that the percentages

“A yard sign coupled with an open house generated twice as many closed seller transactions compared to all categories of Internet websites.”

of sellers who found their listing agent from any Internet site in this survey was equal to the same percentage of sellers who found their listing agent at an open house or from a yard sign? (Only 4 percent!) Putting it a little differently, a yard sign coupled with an open house generated twice as many closed seller transactions compared to all categories of Internet websites (8 percent vs. 4 percent). Moreover, you were just as likely to receive a referral from a relocation company or from another real estate agent or broker as you were to have a seller find you on an Internet website. Ever-shrinking returns Search engines, newspaper ads, Yellow Pages or home book ads accounted for less than 1 percent each of all closed seller leads. Mobile or tablet applications, direct mail pieces (newsletters, fliers, postcards), and “advertising specialty (calendars, magnets, etc.)” all accounted for less than 1 percent of the closed seller leads reported in this survey as well. Perhaps the most startling statistic was that floor duty (“Walked into or called office and agent was on duty”) generated almost as many closed seller leads in this survey (3 percent) as websites. Buyer findings The results from the buyers mirrored the seller results. Specifically, websites were responsible for generating 9 percent of the buyers in the survey who closed a transaction as a buyer. As before, you still would be more likely to meet a buyer who will close if you have a yard sign combined with an open house. Nine percent of buyers who closed were from websites. Twelve percent of buyers who closed came from either an open house (6 percent) or a For Sale/Open House sign (6 percent.) Floor duty held constant at 3 percent.

Some things never change With all the noise around prospecting using websites, social media and other online resources, the one factor that really makes the difference is a referral from a trusted resource or face-to-face contact. This is true for buyers and sellers from all age categories. For sellers, 39 percent found their real estate agent through a friend, neighbor or relative. Another 25 percent used the agent they had previously used to list or buy a home. Another 4 percent came from referrals from other real estate agents or brokers, and 3 percent came through an employer or relocation company. That’s a whopping 71 percent of all closed seller transactions resulting from “trusted sources” or face-toface contact. The buyer numbers mirror the seller numbers. Seventy percent of all closed buyer leads came from a “trusted resource” or faceto-face contact. (Specifically, 42 percent came from the agent’s sphere of influence, 12 percent had used their agent on a previous transaction, 6 percent met at an open house, 4 percent were referred by another agent, and an additional 4 percent were referred by a relocation company.) Where to spend your money While these findings are surprising, there’s a wild card in the mix called “Other.” Does “other” include social media, video, or other online marketing tools independent of “Internet websites”? The report does not address this issue. Nevertheless, these findings make it abundantly clear as to what your best ad spend will be. First, your No. 1 priority should be expanding your database and generating referrals from people who like you and the services that you provide. Second, it is vital that you stay in contact with past clients. Not only are they great sources of referrals, they are highly probable to hire you the next time you transact if you stay in contact. Third, any activity that puts you face to face with buyers and sellers is more likely to produce a closed deal than activities that rely on impersonal contact. Bernice Ross, CEO of RealEstateCoach.com, is a national speaker, author and trainer with over 1,000 published articles and two best-selling real estate books. This article was reprinted in Salt Lake Realtor® Magazine with permission of Inman News. Copyright 2014. All rights reserved.

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Salt Lake Realtor® June 2014

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Home-Price Growth Slows in Many Metro Areas during First Quarter The national median existing singlefamily home price was $191,600 in the first quarter; in the West the median price jumped to $282,100 Although strong year-over-year price growth continued in most metropolitan areas in the first quarter, increases were somewhat smaller, according to the latest quarterly report by the National Association of Realtors®. A companion breakout of income requirements to purchase a median-priced home on a metro basis shows the typical buyer was in a good position to buy an existing home in many cities in the Midwest and South. The median existing single-family home price increased in 74 percent of measured markets, with 125 out of 170 metropolitan statistical areas (MSAs) showing gains based on closings in the first quarter

Salt Lake Realtor® June 2014

compared with the first quarter of 2013. Thirty-seven areas, 22 percent, had double-digit increases, and 45 areas recorded lower median prices. In the fourth quarter of 2013, price increases were recorded in 73 percent of metro areas from a year earlier, with 26 percent rising at double-digit rates, but 89 percent of markets were showing yearover-year gains in the first quarter of 2013. Lawrence Yun, NAR chief economist, said the price trend is favorable. “The cooling rate of price growth is needed to preserve favorable housing affordability conditions in the future, but we still need more new-home construction to fully alleviate the inventory shortages in much of the country,” he said. “Limited inventory is creating unsustainable and unhealthy price growth in some large markets, notably on the West Coast.” The national median existing single-family home price was $191,600 in the first quarter, up 8.6 percent

from $176,400 in the first quarter of 2013. In the fourth quarter the median price rose 10.1 percent from a year earlier. The median price is where half of the homes sold for more and half sold for less. Distressed homes – foreclosures and short sales generally sold at discount – accounted for 15 percent of first quarter sales, down from 23 percent a year ago. The five most expensive housing markets in the first quarter were the San Jose, Calif., metro area, where the median existing single-family price was $808,000; San Francisco, $679,800; Honolulu, $672,300; Anaheim-Santa Ana, Calif., $669,800; and San Diego, where the median price was $483,000. The five lowest-cost metro areas were Youngstown-Warren-Boardman, Ohio, with a median single-family home price of $64,600 in the first quarter; Decatur, Ill., $69,600; Toledo, Ohio, $72,100; Rockford, Ill., $73,100; and Cumberland, Md., at $81,400. Yun notes many smaller areas had some of the biggest changes in median price from a year ago. “Prices in smaller areas tend to be a bit more volatile, with changes in the share of distressed sales affecting comparisons,” he said. “In such cases, looking at the annual prices for those areas help to put it into perspective.” At the end of the first quarter there were 1.99 million existing homes available for sale, 3.1 percent above the first quarter of 2013, when 1.93 million

homes were on the market. The average supply during the quarter was 5.0 months; it was 4.6 months in the first quarter of 2013. A supply of 6 to 7 months represents a rough balance between buyers and sellers. Total existing-home sales, including singlefamily and condo, fell 6.9 percent to a seasonally adjusted annual rate of 4.60 million in the first quarter from 4.94 million in the fourth quarter, and were 6.6 percent below the 4.93 million level during the first quarter of 2013. Sales in the Midwest and Northeast were notably impacted by severe winter weather, while limited inventory and reduced affordability affected the West. According to Freddie Mac, the national commitment rate on a 30-year conventional fixed-rate mortgage averaged 4.36 percent in the first quarter, up from 4.30 percent in the fourth quarter and 3.50 percent in the first quarter of 2013. NAR President Steve Brown, co-owner of Irongate, Inc., Realtors® in Dayton, Ohio, said there’s been some erosion in housing affordability. “Both home prices and mortgage interest rates are higher than a year ago, but the good news is that median income is enough to purchase a home in most areas. There are good potential buying opportunities in areas where there has been consistent local job creation, and where prices have not risen significantly, or where they may be experiencing temporary declines,” he said.

EVENT LOCATION: Daybreak’s Brookside Park 4860 Dock Street (10500 South) RSVP for the REALTOR Day Brunch to the Salt Lake Board slrealtors.com by July 24, 2014. QUESTIONS: Barbara Breen at Daybreak Phone: 801.204.2844 Email: Barbara.Breen@riotinto.com Or: Contact the SLBR at 801.542.8840

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A N NUA L R E A LTOR ® DAY

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Salt Lake Realtor® June 2014

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“I have never believed that real estate disruption comes from consumers selling their own houses. Individual real estate agents are here to stay. They provide an invaluable service that most of us need and want.” “Restrictive mortgage credit remains an unnecessary headwind for the housing market, but NAR is also concerned about costly mortgage insurance fees imposed on Federal Housing Administration-backed home loans that have more than doubled since 2010, pricing out as many as 125,000 to 375,000 buyers,” Brown added. “When you combine the increases in home prices and interest rates with record-high premiums, home purchases are becoming increasingly out of reach for many qualified borrowers who rely on FHA financing.” Outside of these market headwinds, a separate breakout of qualifying incomes to purchase a medianpriced existing single-family home on a metropolitan area basis demonstrates sufficient buying power in the majority of metro areas. Income requirements are determined using several scenarios on down payment percentages and assume 25 percent of gross income devoted to mortgage principal and interest at a mortgage interest rate of 4.4 percent. The national median family income was $64,500 in the first quarter. However, to purchase a home at the national median price, a buyer making a 5 percent down payment would need an income of $44,200. With a 10 percent down payment the required income would be $41,800, while with 20

Salt Lake Realtor® June 2014

percent down, the necessary income is only $37,200. In the condo sector, metro area condominium and cooperative prices – covering changes in 59 metro areas – showed the national median existingcondo price was $191,400 in the first quarter, up 10.8 percent from the first quarter of 2013. Fifty metros showed increases in their median condo price from a year ago, and nine areas had declines. Regionally, total existing-home sales in the Northeast fell 10.2 percent in the first quarter and are 6.8 percent below the first quarter of 2013. The median existing single-family home price in the Northeast was $239,300 in the first quarter, up 2.2 percent from a year ago. In the Midwest, existing-home sales dropped 11.5 percent in the first quarter and are 10.5 percent below a year ago. The median existing single-family home price in the Midwest increased 6.7 percent to $144,000 in the first quarter from the same quarter a year ago. Existing-home sales in the South declined 3.6 percent in the first quarter and are 0.7 percent below the first quarter of 2013. The median existing singlefamily home price in the South was $168,900 in the first quarter, up 7.7 percent from a year earlier. In the West, existing-home sales fell 6.0 percent in the first quarter and are 12.4 percent below a year ago. The median existing single-family home price in the West jumped 14.0 percent to $282,100 in the first quarter from the first quarter of 2013. The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

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Housing Watch Salt Lake Home Sales Fall 13% in April; Davis County Sees a 17% Drop in Sales Home sales (all housing types) in Salt Lake County fell 13 percent in April (year-over-year). The monthly decline follows a 5 percent drop in home sales in March (year-over-year). “Not only are we seeing a decline in closed transactions, but the rapid rise in housing prices is starting to taper,” said Angie Domichel Nelden, president of the Salt Lake Board of Realtors®. “Pending sales were down 5 percent in April suggesting potential home buyers are pulling back.” In Salt Lake County, 1,174 homes/condominiums were sold by Realtors® in April, down nearly 13 percent compared to 1,344 sales in April 2013. In Davis County, home sales in April fell 17 percent (364 sales compared to 437 a year ago). The median price of homes and condominiums sold in April in Salt Lake County increased to roughly $225,000 up nearly 2 percent compared to a median price of $221,663 in April 2013. Home prices have increased in the Salt Lake area since April 2012 (year-over-year), a period of 25 consecutive months. Nationally, total existing-home sales (which

Sales (All Housing Types) Year-Over-Year (Down 13%)

1,344 26

Salt Lake County

Salt Lake Realtor® June 2014

1,174

are completed transactions that include singlefamily homes, townhomes, condominiums and co-ops) are 6.8 percent below the 4.99 millionunit level in April 2013, according to the National Association of Realtors®. “Some growth was inevitable after sub-par housing activity in the first quarter, but improved inventory is expanding choices and sales should generally trend upward from this point,” said Lawrence Yun, NAR chief economist. “Annual home sales, however, due to a sluggish first quarter, will likely be lower than last year.” Based on sales trends over the past 12 months, Salt Lake County in April had a 4.2-month supply of housing inventory, up from a 3.9-month supply of inventory a year ago. A seller’s market, one in which there are more buyers than sellers, is typically characterized by housing inventory levels below a four-month supply. A four- to sixmonth supply of housing inventory is considered a normal market. In Davis County, home prices increased 5 percent in April to a median price of $214,250, up from $204,000 a year ago.

Salt Lake County Median Price (All Housing Types) Year-Over-Year (Up 2%)

$221,663

$224,950

2 - C OLOR

Salt Lake County Days on Market (All Housing Types) Year-Over-Year (Up 2%)

Sales $ Davis County Median Price (All Housing Types) Year-Over-Year (Up 5%) $214,250

$204,000

Salt Lake County

Pending Sales (Down 5%)

1,508

1,579

Sales

Davis County Sales (All Housing Types) Year-Over-Year (Down 17%)

364

437

Salt Lake Realtor速 June 2014

REALTOR® Connections Q&A: Tim Roberts Tim Roberts has worked as a mortgage loan officer since February 2003. He currently works at Bank of Utah, where he has been for the past 2.5 years. He specializes in purchase loans, utilizing such loan programs as FHA, Utah Housing, VA, and conventional loans. He enjoys helping people find the home that best fits their family’s needs. Q: What is the HomeStart Grant? A: The Home$tart Grant is a grant offered to qualifying borrowers to purchase a home who might otherwise not be able to buy a home now. Q: How much is the grant amount? A: A grant can be up to $5,000 based on a borrower’s ability to save. The Home$tart Grant is given based a 3 to 1 savings. So someone that has saved $1,667 can receive the $5,000 grant to be used towards down payment or closing costs on a home purchase. The Home$tart Grant can be used with a FHA loan, Utah Housing, and some conventional loans. Q: Who qualifies for the program? A: Borrowers must have a 640 FICO score, moderate to low income requirements, and the ability to save. The Home$tart Grant is for a first-time home buyer, not for a borrower who might have access to additional sources of down payment or who has owned a home in the past. Please contact me at troberts@bankofutah.com, or a Bank of Utah loan officer to learn more about how this program might help a borrower purchase a house today.

Young vs. Seasoned Professionals

On the Move RealtyTrac® released its Q1 2014 U.S. Institutional Investor & Cash Sales Report, which shows the share of all-cash sales reached a new high in the first quarter even as the share of institutional investor purchases dropped to the lowest level since the first quarter of 2012. The report shows 42.7 percent of all U.S. residential property sales in the first quarter were all-cash purchases, up from 37.8 percent in the previous quarter and up from 19.1 percent in the first quarter of 2013 to the highest level since RealtyTrac began tracking all-cash purchases in the first quarter of 2011. Institutional investors — entities that have purchased at least 10 properties in a calendar year — accounted for 5.6 percent of all U.S. residential sales in the first quarter, down from 6.8 percent in the fourth quarter of 2013 and down from 7.0 percent in the first quarter of 2013 to the lowest level since the first quarter of 2012. Equity Real Estate welcomes the following Realtors® to its brokerage: Lori C. Jackson, David E. Madsen, Brian Payne, Megan Bradshaw, Leticia ElizondoRichard Travis Hughes, Travis Kozlowski, Jasmine R. Leonardi, Jeila McGuire, Anne Howard, Julie Carlon, Kari Burgoyne, Irma Almada, Andrew Arrendondo, Jason Nau, Michael Gallagher, Amie Rasmussen- Jensen, and Teresa Nieto.

The Young Professionals Network in May hosted a panel discussion at the Realtor® Campus featuring seasoned and young agents who discussed ways to connect with each other and valuable resources to help each other succeed in business. “Professionalism still matters,” said Jake Breen, Realtor® with Berkshire Hathaway HomeServices Utah and a finalist for this year’s Managing Broker of the Year Award. “But I would say in this day and age how you are dressed and what kind of car you drive is a little bit further down the totem pole. They care a little bit more about information, savviness, market data, how you interact with them, and how you build the relationship.” Panelists included (above): Gale Frandsen (left), Jake Breen, Heather Roxburgh and Mark Ulrich.

Salt Lake Realtor® June 2014

Utah companies generated more than $12 billion in deals last year in IPOs, mergers and investments, up 12 percent from the previous year. At the Mountain West Capital Network’s Deal Flow event, Drew Yergensen, VicePresident of Key Bank and event chair, announced that this is the best year for deal flow in Utah’s history.

29TH ANNUAL Salt Lake Board of Realtors®

CHARITY

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Benefiting The Road Home & The Christmas Box International Salt Lake Marriott Downtown City Creek 75 South West Temple

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Friday, June 27 Sponsor’s Reception 5:30 p.m. Silent Auction 6-7 p.m. Dinner & Live Auction 7 p.m. Tickets available at slrealtors.com $85 per person

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