Despite deep one-year drop, home prices still aren’t coming down

Tooele County’s real estate industry plummeted in 2008 compared to the previous year, according to data compiled by the Wasatch Front Multiple Listing Service.

The total dollar volume of single-family homes sold in the county fell 36 percent last year, while the total number of homes sold fell 34 percent. Average home prices declined only 3 percent, from $206,714 in 2007 to $201,566 last year.

However, there’s evidence prices may be on the way down. For the fourth quarter of 2008, 113 single-family homes sold at an average price of $194,938.

Homes also spent much longer on the market in 2008. In 2007, the average number of days on the market was 45. Last year that wait lengthened to 75 days.

Buyers aren’t the only ones waiting either.

Tom McCarty, broker for Stansbury Real Estate, said economic worries have hit the market hard over the past year. He said his office currently has 17 or 18 home listings, but that he usually only receives one or two calls per week from potential buyers.

“People are scared to lose their job, and they want to wait and see if the interest rates go lower,” McCarty said. “That’s why we haven’t seen a lot of activity. The kind of homes that do sell are the ones that are dropping in price.”

Steve Griffith, Realtor for Prudential Real Estate in Tooele, agreed that less expensive homes are selling best in the current market.

“Most people looking for a home out there are first-time home buyers, so they’re looking for a mid-level starter home under $200,000,” Griffith said. “If you have a decent job and can get a loan, you can afford a payment for a house like that. For a lot of people, $200,000 is the cutoff point for what they feel they can afford.”

Another reason cited for the market slowdown in 2008 was rising gas prices, which may have turned away potential buyers who work in Salt Lake City. Excess inventory and a lack of new home construction also conspired to put the breaks on the market, according to many local industry insiders.

McCarty said that although sales activity is still slow, he feels the market will pick up as the weather becomes warmer.

“I think a lot of it has to do with the time of year,” he said. “A lot of people just don’t like moving during the winter.”

Doug Radunich: dougrad@tooeletranscript.com