Salt Lake REALTOR

June 2008

In an inerview wih Sal Lake REALOR®, Tredgoldconinues o gush opimism oward he U.S. and Uaheconomies despie soaring energy prices, a global credicrunch and lagging home sales.For insance, Tredgold believes he naional mediahave done wha he calls a “errible disservice”o he housing indusry. “Te naional mediasory is, ‘Why would you even hink abou buying a house righ now when you know you can buy i cheaper in six monhsor 12 monhs,’” he said. “In Las Vegas,Miami or San Diego ha may be rue, bu you can’ make blanke saemensabou he whole housing economy.”Especially here in Sal Lake Ciy, Tred-gold said, which coninues o ouper-orm he roubled housing markes o Las Vegas, Los Angeles, Miami and Phoenix.“Our prices didn’ runup as high as Caliornia, Arizona, Nevada andFlorida,” he said. “Tose were he sexy places o buildand buy real esae because hehinking used o be ha here wasgoing o be no end o rising homeprices. Now, all our o hose saes are ina recession.” And while Sal Lake Couny has also aken a hi in homesales compared o las year, he Wasach Fron is doing greacompared o oher saes, Tredgold said. In Las Vegas, orinsance, home prices have allen nearly 25 percen overhe pas year. And Tredgold said home prices in Vegascould ank anoher 10 percen o 20 percen beore hiting botom. In conras, he median home price in Sal LakeCouny dropped 6 percen beween las year’s hird andourh quarers. Ye, beween he ourh quarer o 2007and his year’s frs quarer, he median price increased 2percen. A 5.6 percen, Uah ranked No. 2 in he naion inhouse-price appreciaion in he frs quarer compared o year ago, according o he U.S. O ce o Federal HousingEnerprise Oversigh.In addiion, April’s sales compared o January are up 52percen, according o he Wasach Fron Regional Mul-iple Lising Service. In 2007, during he same our-monhperiod in Sal Lake Couny, he up ick in sales was jus 22percen. In 2006, i was 38 percen.hredgold’s opimism is shared by Forbes magazine, which in April ranked Sal Lake Ciy as one o 10“recession proo” ciies in he U.S. “hough Sal LakeCiy’s unemploymen rae is rising, i’s sill among helowes o he counry’s 50 larges ciies,” he Forbesaricle said. “A November 2007 repor rom he U.S.Conerence o Mayors projeced ha Sal Lake Ciy would be one o he ew large ciies in he counry noo suer a decline in gross meropolian produc romhe morgage crisis.” And despie alk o a naional recession, Uah is sill cre-aing new jobs a a rae o 2 percen, more han six imeshe naional job growh rae o 0.3 percen. In ac, a heend o he ourh quarer o 2007 he Wasach Fron hadroughly 35,000 unflled jobs wih an average pay o $13.10an hour, according o he Uah Deparmen o WorkorceServices. Many o hose job vacancies included civil engi-neers, elecricians, fre fghers and accouns clerks.Bu he good economic news does no mean Uah won’ escape he eecs o a naional housing downurn,according o Nigel Swaby, a Sal Lake morgage broker.Swaby believes he wors is ye o come when i comes oalling home sales and oreclosures.“We are no where close o botom,” Swaby said. “For henex year i’s going o be prety bad. I don’ hink people will ge excied abou real esae unil here are signifcandiscouns. We’re jus no here ye.”

Our economy is three times the size of No. 2 Japan. It is four times the size of No. 3 and No. 4 Germany and China

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fter five consecutive quarters of posting thehighest rates of house-price appreciation in thenation, Utah fell to the No. 2 spot in this year’s firstquarter, according to a May report by the U.S. Office ofFederal Housing Enterprise Oversight.For the three months ended March 30, Utah home pricesappreciated 5.58 percent compared to the first quarter of2007. When compared to the fourth quarter of 2007, Utahhome prices declined slightly at 0.20 percent.Wyoming saw the strongest house-price appreciationof all states at 6.34 percent. California ranked deadlast, with home prices there dropping 10.58 percent.Besides California, 14 other states (including Nevada,Florida, Arizona and Michigan) saw home prices fall.Three Utah cities made the top 20 list of 292 U.S. citiesshowing the highest rates of appreciation. The Provo-Oremarea was No. 6 at 6.76 percent. Ogden-Clearfield was No.9 at 6.64 percent. Logan ranked No. 15 at 6 percent. SaltLake City was No. 22 at 5.39 percent. St. George was No.235, with home prices there dropping 3.65 percent.Nationally, home prices were down 0.03 percent in thefirst quarter compared to a year ago and down 0.23percent compared to the fourth quarter of 2007.James B. Lockhart, OFHEO director, said the nationalprice declines bring positive and negative news. “Forhomeowners and financial market observers, thesedeclines spell further erosion in home equity levelsand potentially more trouble for mortgage markets,”Lockhart said. “To prospective home buyers who havebeen shut out of homeownership because of afford-ability constraints, these declines may be welcomenews, as are continued low mortgage rates.”

Top 10 U.S. Cities With Highest Rates of House Price Appreciation

Houma-Bayou Cane-Thibodaux, LA —11.22%Grand Junction, CO —9.08%Wenatchee, WA —8.02%Austin-Round Rock, TX —7.74%Billings, MT —7.09%Provo-Orem, UT —6.76%Anderson, SC —6.73%Mobile, AL —6.64%Ogden-Clearﬁeld, UT —6.64%Hickory-Lenoir-Morganton, NC —6.41%

Salt Lake REALTOR

June 2008

Swaby, who produces his own real esae blog – www.slcrealesae.blogspo.com – said he Uah housingmarke has me is mach. “I appears 100 percen fnancingis he kryponie o Uah’s housing marke as well as heoher remaining srong markes like hose in he PacifcNorhwes and Norh Carolina,” one recen posing men-ioned. “Over ime, buyers, sellers and lenders will adap.Te high-ying easy lending o he pas ew years will prob-ably never come back, bu evenually hings will even ou.”Hisorically, Swaby added, Uah has always been high inoreclosures, bankrupcies and morgage raud. And heagrees wih a Pew Chariable rus repor issued earlierhis year which predics ha Uah oreclosures will jumpo 4 percen over he nex wo years. Currenly, Uah’soreclosures are less han 1 percen, according o heMorgage Bankers Associaion. Naionally, he oreclo-sure rae is roughly 2 percen.Tredgold disagrees wih he Pew projecions when icomes o uure Uah oreclosures. Bu Tredgold is noPollyanna eiher. Uah’s housing marke, he said, is srug-gling. And naionally he housing marke is in a recession, bu he problem remains a fnancing issue. In March,Tredgold, who was par o a USA oday survey o 50naional economiss, agreed wih mos o his colleaguesha he U.S. was in a recession or would ener one. Buaer sronger han expeced GDP growh in his year’sfrs quarer and ewer han expeced job losses, Tred-gold changed his mind.“Te discussion now is ha we probably are no goingo have a recession,” Tredgold said. “Almos everybody expecs growh o pick up in he second hal o his year.Global fnancial sress is impacing Sal Lake Ciy realesae morgage lending. Bu in erms o he whole crediissue, he wors is probably behind us. We’ve seen many o he Wall Sree banks and banks around he world wrie