How will the Wasatch Front and greater Salt Lake City real estate market be in 2010?  The Salt Lake Board of Realtors just released its Salt Lake Housing Forecast – a study by James Wood, Director of the University of Utah’s Bureau of Economic and Business Research.  James’ research looks at both current and historical trends.

In it are some obvious points.  We are still in a buyer’s market, and home values have dropped significantly.  The tally for 2009 wasn’t as bad as 2008 which indicates the worst is most likely behind us.  In fact, economists are predicting a 10% increase in home sales for 2010.  This may raise a concern by the many who have been waiting to time the market perfectly.  While the volume of transactions is likely to increase, prices probably won’t.  There are still too many lender mitigated properties driving the market to see any increase in values.  This isn’t to say we are going to continue dropping largely.  Prices may continue to decline, but we are very near leveling off.

The Utah housing market bubble wasn’t nearly as big as the national average.  We typically lag behind the national trends by several years.  When the national housing boom peaked in 2005 after a strong 5-7 year run, Utah’s housing market was still extremely undervalued, and our boom was just getting started.  Following those trends, Utah’s housing market would continue to grow for another 5 years or more.  In fact, while the majority of the country’s home prices were falling in 2006 & 2007, Utah was among the top in the nation in home value appreciation.  The mortgage crisis and financial meltdown in 2007 burst our bubble before it had the opportunity to fully inflate.  Fortunately for us, the less we climbed, the less we had to fall.

Utah short sales and foreclosures will continue to influence the market and interest rates are expected to hover around 5% making 2010 a particularly good year for the investor and the move-up buyer.