Cost of an Overly Critical Society is Destroying Civility!
In our fast-paced, interconnected world, criticism seems to be everywhere. While constructive criticism can be a tool for growth and learning, an overly critical society can have deeply damaging impacts on individuals, families, communities, workplaces, and overall civility within our society. Where criticism becomes the prevailing tone, a culture of negativity and cynicism often follows. Look no further than online forums and social media platforms, where toxic comments can breed an unwelcoming atmosphere.
“Most of us are subjected to insults, sarcastic comments or bad feedback in our everyday lives,” according to an article on BBC.com. “But we weren’t built to deal with torrents of criticism.”
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Excessive criticism doesn’t just affect our digital interactions. A 2014 study by the University of Waterloo in Ontario, Canada, uncovered that those who are overly self-critical struggle to form and sustain both personal and professional relationships.
Workplaces and educational settings are not immune to the stifling effects of a hyper-critical environment. According to Harvard Business Review, an environment rife with criticism can breed a fear of failure, dampening creativity, and hindering innovative thinking.
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As noted by social psychologist Roy Baumeister, co-author of “The Power of Bad: And How to Overcome It,” humans are wired to focus on the negative. While this can be helpful in extreme situations, it becomes unproductive in daily life. Baumeister argues that until we learn to balance this bias, our worldview remains distorted, impacting how we respond to daily challenges and interact with others.
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The ripple effects of a critical society reach even our political discourse, driving increased polarization. The divide between political parties has grown, obstructing collaboration and constructive dialogue.
To combat these negative impacts, it is essential to turn inward and evaluate our own tendencies to criticize. A 2013 study by the University of Illinois emphasizes the importance of self-compassion and recognizing our flaws. By approaching criticism with empathy and self-awareness, we promote more tolerant and positive relationships.
The consequences of an overly critical society reach far and wide, affecting our personal lives, professional interactions, and the overall civility that binds us together. While criticism can be a valuable tool for improvement, it must be handled with care and self-awareness. By understanding the costs and cultivating a more compassionate approach, we can mitigate these negative effects and foster a society that values empathy, innovation, and cohesion.
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REALTOR is a registered mark which identifies a professional in real estate who subscribes to a strict Code of Ethics as a member of the NATIONAL ASSOCIATION OF REALTORS
August 2023 | Salt Lake Realtor ® | 7
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The Salt Lake Board of REALTORS® is pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the nation. We encourage and support the
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Utah is Ranked as The Best State
According to U.S. News & World Report, Utah is ranked as the best state in the nation across 71 metrics, including economy, education, health care, infrastructure, fiscal stability, and opportunities. Tourism and a growing tech sector are among Utah’s economic drivers. “Utah is well-known for its recreation opportunities, especially skiing,” the report noted. “With more than 300 trails, the largest ski resort in the country lies at Park City. The creation of the resort has added about 8,000 jobs to Utah’s labor force.”
Washington and Idaho ranked as the second and third best states, respectively. Louisiana ranked last. The Best States rankings provide insights into how well states serve their residents across various categories.
Home Prices Dip, But Decline Appears Temporary
During the first half of 2023, the median single-family home price in Salt Lake County fell to $580,000 from $623,277 in the same period in 2022, according to UtahRealEstate. com. This decrease was primarily attributed to higher mortgage interest rates. However, there was a noteworthy rise in monthly median single-family home prices, starting from $535,750 in January and reaching $600,000 in June. This increase was largely driven by a scarcity of available housing inventory in the region.
Median Single-Family Home Prices
Salt Lake County | January through June
The U.S. housing sector is back in full swing and builders are best positioned to ride the wave, according to MarketWatch.
The housing market went into a recession at the end of 2022, after mortgage rates surged from 4% to 7%, making homeownership more expensive, and depressing home sales. Since then, housing has mostly rebounded, but with the housing market seriously short of homes for sale as homeowners hold out on selling, the sector is still facing a fundamental supply-and-demand problem.
The key players poised to reap the benefits of — and permanently fix — this imbalance are home builders, according to two economists at mortgage-financing giant Fannie Mae. The government-owned enterprise purchases mortgage loans from lenders and either holds them on their books, or packages them into mortgage-backed securities — and sells them to the broader market.
“If they get to that level, that will help absorb current demand pretty well,” Doug Duncan, chief economist at Fannie Mae, told MarketWatch. And now for the bad news. “The question is catching up, and we think that will take two or three years,” he added. “So it looks to us like a pretty good environment for builders for some time.”
A decade of underbuilding is one reason why the U.S. is facing such a shortfall in housing supply, Duncan explained.
According to Realtor.com, the U.S. is short of 6.5 million single-family homes.
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8 | Salt Lake Realtor ® | August 2023
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THE
Salt Lake Parade of Homes Realtor® Day
Several hundred members of the Salt Lake Board of Realtors® participated in the Salt Lake Parade of Homes Realtor® Day on July 26, held at the Realtor® Campus in Sandy. The event showcased a 312 square-foot tiny home and included various food trucks. This year's Parade also featured a strikingly large, nearly 26,000 square-foot home constructed by Anchor Construction & Design, marking it as the largest home ever to be showcased in the history of the Salt Lake Parade of Homes.
Jaren Davis, the executive officer of the Salt Lake Home Builders Association, hailed the turnout as a success, expressing his gratitude to the numerous Realtors® who purchased Parade tickets and toured this year's collection of 26 remarkable Parade homes. As a major sponsor of the Parade, the Salt Lake Board of Realtors® continues to play an integral role in this event.
10 | Salt Lake Realtor ® | August 2023
August 2023 | Salt Lake Realtor ® | 11
Photos: Dave Anderton
Lack
of Inventory Stopped Clients from Buying Homes in 2022
Housing inventory fell to the lowest level recorded since 1999, according to NAR annual report.
By The National Association of Realtors®
Amid a significant shortage of housing supply in 2022, 32% of Realtors® named a lack of inventory as the most important factor limiting potential clients from making a purchase, according to the National Association of Realtors®’ 2023 Member Profile. This annual report analyzes members’ business activity and demographics from the prior year. Housing inventory fell to the lowest level recorded since 1999 as home buyers entered the market at a frenzied pace to lock in historically-low interest rates.
“The report’s findings clearly show that the lack of housing inventory is impacting Realtors®’ ability to find buyers a home,” said Jessica Lautz, NAR deputy chief economist and vice president of research. “Housing inventory and affordability continue to be the top obstacles that hold back potential clients in the housing market.
Business Characteristics of Realtors®
Nearly two out of three Realtors® – 64% – hold sales agent licenses, while 20% hold broker licenses and 18% hold broker associate licenses. Seventy percent of members specialize in residential brokerage. Like in
2021, relocation, residential property management and commercial brokerage are members’ most common secondary specialty areas.
Members typically have 11 years of real estate experience, up from eight years in 2021. Those surveyed with two years or less experience declined to 17% in 2022, down from 25% in 2021, while those with 16 years or more experience increased to 42% in 2022, up from 39% in 2021. Like in recent surveys, more than threequarters of members – 76% – are certain they will remain in the real estate industry for at least two more years.
Business Activity of Realtors®
The typical NAR member had a higher sales volume ($3.4 million vs. $2.6 million) and the same number of transactions (12) in 2022 compared to 2021.
The typical Realtor® earned 27% of their business from previous clients and customers, an increase from 16% last year. The most experienced members – those with 16 or more years of experience – reported a greater share of repeat business from clients or referrals (a median of 43% in 2022 vs. a median of 44% in 2021).
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Similar to 2021, members with two years of experience or less reported no repeat business in 2022. Overall, Realtors® earned a median of 24% of their business from referrals, an increase from 20% in 2021. Referrals were also more common among members with more experience, with a median of 30% for those with 16 or more years of experience (vs. 31% in 2021) compared to 4% for those with two years or less of experience (vs. 0% in 2021).
Income and Expenses of Realtors®
The median gross income for Realtors® increased to $56,400 in 2022, up from $54,300 in 2021. Realtors® with 16 years or more experience had a median gross income of $80,700, down from $85,000 in 2021. Realtors® with two years or less experience had a median gross income of $9,600, an increase from $8,800 in 2021. Higher inflation impacted Realtors® last year as total expenses increased to $8,210 in 2022 from $6,250 in 2021.
A majority of Realtors® – 55% – worked with an independent company and 89% were independent contractors at their firms – both figures nearly identical to 2021. Forty-three percent of members worked at a firm with one office and nearly one-quarter (24%) worked at a firm with two to four offices. The typical Realtor® had a median tenure of six years with their
August 2023 | Salt Lake Realtor ® | 13
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current firm, up from a median of five years in 2021. Twenty-six percent of members reported working for a firm that was bought or merged in the past two years, up from 8% in 2021. Like in 2021, errors and omissions insurance was the most common benefit provided by members’ firms in 2022.
Technology and Realtors®
Daily, the strong majority of Realtors® use a smartphone with wireless email and internet capability (95%) and a laptop or desktop computer (90%). The smartphone features that members use most frequently on a daily basis are email (93%), GPS apps (48%) and social media (46%). Text messaging (94%) is the top method of communication for members with their clients, followed by phone calls (92%) and email (90%) – all the same as last year. Two-thirds of members – 66% – have their own website. Seven percent of Realtors® use drones themselves as part of their business, and 43% have hired a professional drone operator. Four percent and 1% of members, respectively, use 3D/virtual tour and virtual staging technology daily.
“Despite the changing market conditions that Realtors® faced throughout 2022, members rose to the challenge by embracing new technology to help buyers find their homes and sellers to market their properties,” Lautz said.
Demographic Characteristics of Realtors®
Eighty-one percent of Realtors® were White in 2022, up from 77% in 2021. Hispanics/Latinos accounted for 10% of Realtors®, followed by Black/African Americans and Asian/Pacific Islanders – both at 5%. When compared to more experienced members, new Realtors® tended to be more diverse. Among those who had two years or less of experience, 41% were racial minorities in 2022, an increase from 37% one year ago.
Sixty-two percent of all Realtors® were female in 2022, down from 66% in 2021. The median age of Realtors® was 60, up from 56 from the previous year. Just over half of members – 52% – were over 60 years old and 1% were under the age of 30.
Overall, the education level among Realtors® exceeded that of the general public. Ninety-one percent of members had some post-secondary education, with 31% completing a bachelor’s degree as their highest level of educational attainment.
Two-thirds of members – 66% – reported volunteering in their community. Volunteering was most common among members aged 40 to 49 years.
“Realtors® are everyday, working Americans who champion homeownership and property rights for the communities they serve,” said NAR President Kenny Parcell, a Realtor® from Spanish Fork, Utah, and brokerowner of Equity Real Estate Utah. “Regardless of how you find a property, expert real estate agents help take the stress out of the home buying process and navigate what is for many the most complex and important transaction they’ll ever do.”
Survey Methodology
In March 2023, NAR e-mailed a 98-question survey to a random sample of 146,624 Realtors®. Using this method, NAR received 6,902 total responses. The survey had an adjusted response rate of 4.7%. The confidence interval at a 95% level of confidence is +/- 1.18% based on a population of 1.5 million members. The association weighted survey responses to be representative of state-level NAR membership. Information about compensation, earnings, sales volume and number of transactions are characteristics of calendar year 2022, while all other data are representative of member characteristics in early 2023.
About the National Association of Realtors®
The National Association of Realtors® is America’s largest trade association, representing more than 1.5 million members involved in all aspects of the residential and commercial real estate industries. The term Realtor® is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict Code of Ethics.
14 | Salt Lake Realtor ® | August 2023
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Homeowners Don’t Want to Sell, So the Market for Brand-New Homes Is Booming
High mortgage rates are dissuading sellers, leaving new construction the only game in town; ‘there was no inventory’
By Nicole Friedman The Wall Street Journal
LEHI, Utah — After mortgage rates shot up last year, Ivory Homes, one of Utah’s largest builders, suddenly had few buyers for the hundreds of homes it had under construction. So Clark Ivory, the chief executive, laid off 9% of his staff, and by January he had slashed construction by nearly 80% from its 2022 peak. Then, much to his surprise, sales of new homes started picking up. By May, even though mortgage rates weren’t really budging, sales for all home builders were at their highest level since early 2022.
Millions of American homeowners have been reluctant
to sell because they can’t afford to give up the low mortgage rates they have now. Only 1.08 million existing homes were for sale or under contract at the end of May, the lowest level for that month in National Association of Realtors data going back to 1999. For many would-be buyers—in Utah and in many other markets—new construction has become the only game in town. Newly built homes accounted for nearly one-third of single-family homes for sale nationwide in May, compared with a historical norm of 10% to 20%. Existing-home sales in May fell 20% year-over-year,
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Due to limited rights, this story is only available in the print issue of the Salt Lake Realtor magazine. A copy of this article is available on the Wall Street Journal website but charges may apply.
while new single-family home sales that month rose 20% on an annual basis.
That divergence is yet another example of how this housing market is behaving like no other. “It’s such a rare thing,” said Rick Palacios Jr., director of research at Irvine, Calif.-based John Burns Research & Consulting, who predicts the disparity will widen in coming months.
So far, the home-building revival, coupled with financial incentives offered by builders, is providing only minor relief to prospective buyers. Builders aren’t erecting enough homes to offset the shortage of existing ones on the market, meaning buyers in many places still face bidding wars. On a national basis, home prices have only declined a small amount from their record highs in spring 2022. Interest rates have risen in recent weeks to their highest level this year.
For builders like Ivory, though, it has been a lifeline. Builder confidence, which declined every month in 2022, has risen for seven straight months to its highest level since June 2022, according to the National Association of Home Builders.
August 2023 | Salt Lake Realtor ® | 17
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Due to limited rights, this story is only available in the print issue of the Salt Lake Realtor magazine. A copy of this article is available on the Wall Street Journal website but charges may apply.
Investors believe the home-building industry—one of the most sensitive to changes in interest rates—has already gone through its recession and is coming out the other side.
Publicly traded home builders have reported strongerthan-expected results this year. The S&P Homebuilders Select Industry stock index is up 39.8% this year, outpacing the S&P 500’s 18.6% gain. Share prices for D.R. Horton, Lennar and PulteGroup, the three largest home builders, have performed even better.
The pandemic stoked an especially broad housing boom in 2020 and 2021. Many buyers sought larger spaces to spend more time at home, while others wanted to move closer to family. Ultralow interest rates made it inexpensive to finance their purchases. Home-building activity surged. Mountain West states
such as Utah became an attractive destination during the pandemic for people leaving expensive West Coast cities in search of a lower cost of living and an outdoors lifestyle.
Home prices in the Salt Lake City area soared 53% between January 2020 and May 2022, on a seasonally adjusted basis, according to Freddie Mac’s home-price index.
Family-owned Ivory Homes, which was founded by Ivory’s father, Ellis Ivory, has been one of Utah’s top home builders for decades. Clark Ivory, 58 years old, became CEO in 2000.
In 2006, around the peak of the last boom, Ivory got worried about speculative investing. Ivory Homes started buying less land and paying off debt. To avoid selling to flippers, the company required buyers to sign an agreement that they were purchasing their homes as primary or secondary residences and that they wouldn’t sell for at least a year.
U.S. home prices fell 27% between mid-2006 and early 2012, sending ripples throughout the global economy and world financial markets. Ivory Homes stayed profitable between 2008 and 2012, Ivory said.
The pandemic-driven housing boom, Ivory said, didn’t involve as much speculation. Lending standards have improved, and investors have been buying homes to rent out to tenants, not to flip. During the pandemic boom, builders also faced obstacles they didn’t last time around, which kept them from overbuilding: supply-chain issues and labor shortages added weeks or months to their construction timelines. Ivory said his biggest concern, however, is affordability.
In the spring of 2022, rapidly rising mortgage rates abruptly slowed buying. Prices in Utah and around the U.S. had risen so rapidly that many buyers were priced out.
“It was the third weekend in May last year, and literally the lights just turned off,” said Ryan Smith, president of home building for Denver-based Oakwood Homes, a unit of Berkshire Hathaway that builds in Colorado, Utah and Arizona. “From there, the fight was on” to keep buyers from canceling.
Ivory Homes had 1,089 homes under construction in last year’s first quarter, including 513 that hadn’t yet been sold. “If I made one big mistake in the way I managed through Covid, it was trying to keep up” with demand, Ivory said. “I should have said to myself, ‘We can’t handle this.’”
In the second half of 2022, builders cut prices to attract buyers for their unsold homes or to persuade buyers already under contract not to back out. Demand rebounded this year in the first quarter. By April, builders forecast a 7% increase in sales for 2023, according to a survey by John Burns Research & Consulting, reversing their forecast of a 9% drop when surveyed in November.
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In Daybreak, a master-planned community about a 30-minute drive from Salt Lake City, developer Larry H. Miller Real Estate initially expected to sell 100 to 125 lots this year to home builders, including Ivory Homes. Now it expects to sell 160, according to Brad Holmes, the developer’s president.
“There was no inventory on the existing market, so everybody was being pushed to a new home,” he said.
Ivory Homes has adjusted its building plans to meet current buyers’ tastes and budgets. It is building in a master-planned community called Holbrook Farms in Lehi, a fast-growing city about 30 miles south of Salt Lake City. Lehi and nearby communities are home to the area’s many tech businesses—a major market for Ivory Homes and other builders.
Last fall, Ivory Homes was building three-story homes with three or four bedrooms in Holbrook Farms to sell for up to $625,000. Called E-Villas, they had open kitchens and were targeted at first-time buyers. As demand slowed late last year, Ivory said, the company decided: “We have to hit a lower price point.” It redesigned the E-Villas to offer a two-story version with three bedrooms, priced below $450,000. Now the two-story homes are now selling better than the three-story ones, he said.
Builders nationwide are focusing on cutting costs and building smaller homes with lower price tags. Nationally, the proportion of new homes sold in May for under $300,000 rose to 17%, the highest level since December 2021.
Home builders also began offering sweeter terms to buyers. About 52% of builders provided incentives in July, up from 43% in July 2022, according to a NAHB survey. Many builders are paying to lower buyers’ mortgage rates, often by a percentage point or more, to help make the monthly payments more affordable.
Some buydowns reduce rates for only the first few years of a loan, but many builders, including Ivory Homes, are offering to lower the mortgage rate for the life of the loan. The temporary buydowns require buyers to qualify for the highest mortgage rate the loan will reach.
The arrangements benefit buyers and sellers alike. Builders would rather pay for lower mortgage rates than cut prices, because price cuts can affect the value of other homes in the neighborhood. For buyers, a lower mortgage rate can reduce a monthly payment more than a price cut.
Salt Lake City housing prices aren’t rising at the frenetic pace of 2021 and early 2022. In June, average new-home prices in the metro area fell 11% from the year-earlier period, factoring in the value of incentives, according to a John Burns Research & Consulting survey.
First-time home buyers that tour Holbrook Farms are factoring in a mortgage rate of nearly 7%, according to
John Savage, an Ivory Homes sales consultant. With a rate buydown from the builder, their purchasing power can go up by $100,000, he said.
Katherine Luke and Muhammad Salman had been looking to buy their first home in the Salt Lake City area for more than two years. They didn’t find many existing homes on the market within their budget that didn’t need renovations. Earlier this year, they started looking at new homes instead.
“For the price point, it does seem like it makes more sense than trying to renovate an older home,” Luke said. There is more to choose from in the new-home market, she said.
The couple bought a new four-bedroom house from Ivory Homes in early July for about $600,000. They opted for a temporary buydown that reduces their mortgage rate for the first two years of the loan, and they hope to refinance to a lower rate as soon as they can.
“I’m hoping we made the right decision,” Luke said. “I don’t know if it was the right time to buy, but rents keep going up.”
Buyers remain sensitive to small changes in mortgage rates, and an increase in the average to above 7% could slow demand, builders say. The average rate for a 30year fixed mortgage was 6.96% in the week ended July 13, the highest since November, according to Freddie Mac. A recession, higher unemployment or uncertainty about the presidential election also could spook buyers.
Some regional and local banks have been tightening credit for small businesses, which could also threaten some builders’ ability to borrow money for new projects. And while builders’ costs have come down somewhat, largely due to a big decline in lumber prices, they are still higher than prepandemic levels. Federal student-loan payments are set to resume in the fall, which could make it more difficult for first-time home buyers to save for down payments.
Yet others who delayed their home-buying plans in 2022 have grown comfortable with current mortgage rates, real-estate agents and builders say.
“People still need a house, because they got married last year, they graduated college last year, and they’re tired of waiting,” said Barry Gittleman, chief executive of Murray, Utah-based builder Hamlet Homes.
And after two years of robust home sales and high margins during the recent housing boom, builders can afford to keep offering rate buydowns to entice buyers.
“We’re all relieved now that we had a really good first half of the year,” Ivory said. “This is not a market to be scared about.”
August 2023 | Salt Lake Realtor ® | 19
Reprinted by permission of The Wall Street Journal, Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved Worldwide. License number 5601001123239.
Due to limited rights, this story is only available in the print issue of the Salt Lake Realtor magazine. A copy of this article is available on the Wall Street Journal website but charges may apply.
Provo, Utah
By Sara Korlevich
The city of Provo, Utah, is the biggest boomtown in America, gaining the most new residents and experiencing the sharpest economic expansion in the nation, according to a new analysis by background check company Checkr. In fact, Utah claims four of the biggest boomtowns in the United States.
Checkr’s analysis defines a “boomtown” as a city that has experienced rapid economic growth and development in a short period of time. Using data from the Census Bureau and the Bureau of Economic Analysis, Checkr factored in metrics like growth in population, workforce, housing units, personal income and businesses to compile its list of America’s biggest boomtowns in 2023.
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America’s Biggest Boomtowns: The Fastest-Growing Cities in the U.S. These areas of the country are attracting the newest residents and seeing the fastest economic expansion in the nation. Utah claims four of the biggest boomtowns in the U.S.
Besides Provo, cities in Utah that made the list include St. George (number five), Logan (number eight) and Ogden (number nine). “Utah has fostered a businessfriendly environment that has attracted companies from various industries, including technology, finance, health care and outdoor recreation,” researchers noted. “This has led to job opportunities and a steady influx of professionals and skilled workers seeking employment in these thriving sectors.”
Clearly, Utah has seen some fantastic growth over the past five years in both population and economic development.
Why? Utah has fostered a business-friendly environment that has attracted companies from various industries, including technology, finance, healthcare, and outdoor
recreation. This has led to job opportunities and a steady influx of professionals and skilled workers seeking employment in these thriving sectors.
Alongside Utah, other cities in the top 10 are two highranking Idaho destinations—Boise City, 2nd overall, and Coeur d’Alene, 3rd overall. A combination of strong economic opportunities, top-ranking quality of life, and a lower cost of living has allowed these Idaho cities the opportunity to flourish in attracting new residents.
Rounding out the top 10 are Bend, Oregon, 4th overall; Destin, Florida, 6th overall; tech-favorite Austin, Texas, 7th overall; and Reno, Nevada, 10th overall.
Checkr analyzed data from all 381 US metro areas to uncover the fastest-growing cities in America.
August 2023 | Salt Lake Realtor ® | 21
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In recent years, the country has experienced a significant degree of economic uncertainty, with farreaching implications for businesses, consumers, and the cities they call home.
Factors such as housing instability, workforce layoffs, and a potential recession contributed to a climate of unpredictability, challenging the stability and confidence in the nation’s economy and the growth of cities across the country.
Additionally, the outbreak of the COVID-19 pandemic brought about unprecedented disruptions, leading to widespread job losses, business closures, and financial volatility.
Through all these hardships, certain U.S. cities have grown exponentially, while others have struggled to develop and attract new residents and jobs. Some cities have grown so fast that they’ve been labeled “boomtowns.”
A boomtown refers to a city that experiences rapid economic growth and development within a relatively short period. These cities and towns often undergo a significant population increase and witness a surge in economic activity due to various factors, which we’ll discuss shortly.
Boomtowns typically attract large numbers of people seeking employment and entrepreneurial prospects,
leading to a rapid expansion of infrastructure, housing, and services to accommodate the growing population.
Checkr compiled this list to bring to light cities across the country that are best fit for businesses looking to start up or expand, and for individuals seeking a new home with great opportunities for employment. That said, if a business owner is looking to expand, relocate, or start a new venture, a boomtown might be a good place to learn more about. Additionally, if an individual is looking for a place for higher wages and better employment opportunities, perhaps a boomtown might be for them.
To showcase the boomtowns filled with opportunity, Checkr crunched the numbers using data sourced from the U.S. Census Bureau and the Bureau of Economic Analysis.
The report examined 10 critical factors of 381 US metro areas—the total number of metro areas as identified by the U.S. Census Bureau. Each of the following 10 key factors was weighted appropriately and scaled. Researchers then calculated the weighted sum of the factors to obtain a final Boomtown Score—the lower the score the better—using the metrics below.
Kay factors: Population growth, GDP growth, unemployment rate, workforce growth,poverty rate, housing unit growth, real personal income growth,
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St. George, Utah
change in median age, change in the total number of businesses, percentage of high-earning residents (making more than $100,000)
We’ve learned why certain cities in the US are booming and experiencing economic and population growth. But why are some cities flourishing while others are struggling to grow?
Several factors should be considered here: Economic investment, demographic trends, environmental constraints, social and political instability, market conditions, and climate, among others.
It’s equally important to recognize that each city’s growth potential is influenced by a unique combination of factors, and addressing the challenges requires a comprehensive approach that involves collaboration between government, private sector entities, and the community to identify and overcome barriers to growth.
Decatur, Illinois was the slowest-growing city in the country. Additional research shows that Decatur lacks high-quality manufacturing jobs, and there is a “trickledown effect.” David Wilson, a professor of Geography and Urban Planning at the University of Illinois believes “the jobs replacing the manufacturing jobs are service industry jobs and, in many ways, do not provide a living wage.” The research indicates that economic factors and
job opportunities are contributing to the city’s position as the lowest-ranked city on the list.
Joining Decatur in the bottom five are Shreveport, Louisiana; Lima, Ohio; Lawton, Oklahoma; and Bloomsburg, Pennsylvania.
For Shreveport, specifically, one major limiting factor was COVID-19 and the impact that the pandemic had on gaming and casinos. Reporting immediately following the start of the pandemic, the Shreveport Times said that “the unthinkable happened during the stay-at-home order — casinos went dark. No gaming. No buffets. No concerts. Six area casinos were closed. DiamondJacks never reopened.”
Rounding out the bottom 10 on the list of slowergrowing cities are Pine Bluff, Arkansas; Champaign, Illinois; Erie, Pennsylvania; Beaumont, Texas; and St. Joseph, Missouri.
These low-ranking cities are all struggling for different reasons, but economic hardship is a common theme. From population loss in Erie and Beaumont to the labor force issues in Decatur, each city is struggling currently but ultimately hopes to regain its footing and prosper in the coming years.
Sara Korolevich serves as checkr.com’s editor and content manager.
August 2023 | Salt Lake Realtor ® | 23
John©/Adobe Stock
Stop Believin’! 4 Housing Market Myths Hurting Today’s Buyers and Sellers
Misconceptions are popping up about the state of the real estate market on social channels and forums.
By Sally Jones Realtor.com
The housing market has been decidedly stuck of late. Sellers with low mortgage rates are holding on to their homes, leaving buyers with scant listings to choose from. And buyers who do find a house face substantial economic challenges as median home prices and mortgage rates remain high.
With sellers and buyers at an impasse, misconceptions and outright myths are popping up on both sides about the state of the market on social channels and forums.
However, some of the supposed housing issues that are coming up time and again aren’t true. Here are the four biggest myths about the current housing market and why experts say they’re wrong.
1. The housing market is about to crash, just like in 2008
Today’s buy-sell stalemate has some would-be buyers almost hoping that we are in a bubble—that it will burst and lead to plentiful homes available at fire-sale prices.
24 | Salt Lake Realtor ® | August 2023 eyetronic©/Adobe Stock
No one can blame a buyer dealing with the double whammy of higher home prices and interest rates for hoping for a lucky break. But the reality is that the 2008 housing market collapse tripped a recession that caused record job losses. And job loss doesn’t further anyone’s financial dreams.
Even if we are in a bubble right now—and most experts say it’s hard to call it until it’s in the rearview mirror— conditions are not at all like they were in 2008.
Unlike today, there was a glut of new homes being built then, sellers were trying to attract buyers, and homebuyers could qualify for a mortgage with little to no money down.
“That access to credit included a surge in lenders offering loans to buyers with lower credit scores, or subprime borrowers,” said Chris Ragland, principal at Ragland Capital
Easy credit might sound good in theory, but some loans were adjustable-rate mortgages with a low “introductory teaser ” rate. And once the introductory rate ended and the loan adjusted to a higher rate, some buyers could no longer afford their monthly payments.
“Subprime borrowers in particular who suffered a job loss had little to no accumulated equity in their homes,” said Ragland. So when the economic downturn came, they were immediately underwater on their loans and many defaulted.
None of these conditions is true today. Today almost half of all homeowners have more than 50% equity
“Laws were passed in 2010 to strengthen verification of a borrower’s ability to repay a loan,” said Ragland. And the drivers of today’s home prices are entirely different.
“The 2020 to 2022 price increase was driven by an inventory shortage and unusually low interest rates,” said Bruce Ailion, attorney and Realtor® in Atlanta.
2. Owners have such good rates, they will never sell One of the biggest complaints about today’s housing market is that there just aren’t enough homes for sale. And given the unbeatable interest rates available two years ago, when many bought or refinanced, what would make sellers budge?
“Mortgage rates were forced lower than they should have been, lower than they likely ever will be again,” said Ailion. So when you look at it from the seller’s point of view, it doesn’t make sense to give up a low longterm rate.
But, there are always life events that force homeowners to sell.
People get new jobs and must relocate. Growing families need more room or want to be in a particular school district. Retirees downsize or move to a better
climate. Seniors move to be closer to family or go into assisted living. And their home will go up for sale.
3. As rates rise, home prices will drop
Many would-be homebuyers have hoped that higher interest rates would bring home prices down. But the relationship between interest rates and home prices is complex.
“Interestingly, the increase in interest rates has not resulted in a decline in prices in most markets,” said Ailion.
In fact, home prices have been all over the place this year and vary from city to city. Home prices are still being driven by inventory. And in the most popular locations, an updated home that’s move-in ready might still get multiple offers.
“Some buyers are dating the rate and marrying the house,” Ailion explained. “Today’s high interest rates can be refinanced in the future. And today’s housing prices will likely be higher when those lower interest rates return.”
4. Good-credit buyers are subsidizing buyers with bad credit
This myth blew up over a misunderstanding about government-backed Fannie Mae and Freddie Mac loans and a new fee structure
Fannie and Freddie are government-sponsored enterprises (GSEs) on a mission to make mortgages more accessible to first-time homebuyers with lower incomes but good credit. They don’t issue loans directly but work with lenders to lower their risk by guaranteeing certain loans should the borrower default. The organizations also purchase other lenders’ loans on the secondary market and sell them to investors as mortgage-backed securities. This frees up lenders to be able to keep lending to new borrowers.
Fannie and Freddie are essential organizations in the mortgage industry. About 70% of all mortgages are GSE-backed. So they can set requirements and establish fees.
The new fee structure eliminated upfront fees for first-time homebuyers. At the same time, it increased fees for other loans that are outside the organizations’ stated mission and borrowers who don’t need a leg up: namely, second-home loans, high-balance loans, and cash-out refinances.
It really had nothing to do with a borrower’s credit score.
“It’s a myth,” said Ailion. “Buyers with poor credit always pay a higher interest rate than buyers with good credit.”
Sally Jones writes about home buying, decorating, and renovating.
August 2023 | Salt Lake Realtor ® | 25
