Is Utah Still Affordable?

Utah is still affordable if you bought a house prior to 2020. But if you didn't, you're probably quietly being completely priced out of the market to a great degree. And you might not even realize it.

>> Is looking at an unexpected place to address our affordable housing crisis. >> Macy Christianen and Sage Ellis are engaged and looking for their first home. They're not sure they can afford one in Utah.

>> Job growth is up. Unemployment is down, but almost 10 years since the Great Recession, the effects are still being felt in one specific area. We're talking about your paycheck.

>> Tonight in our unaffordable Utah report, new specialist Lad Eaggan studies a question many Utons are asking. Where's my raise? [music] >> I talked to people every single week who say the exact same thing.

I make great money, so why do things feel so [music] tight? And here's the scary part. Utah isn't as expensive as California or New York or many of the coastal regions, but the math for many people just simply isn't mathing anymore, and the [music] feeling is really setting in.

In the next few minutes, I'm going to show you precisely where the Utah real estate market went from affordable to fragile. And so many people missed the opportunity prior to 2020. And if you're thinking about moving to Utah or within the state of Utah, this knowledge could save you thousands and avoid the pitfalls of some big mistakes that a lot of people make.

Now, [music] look, the common belief is Utah's still very affordable compared to most other places. And technically, [music] that is true. In fact, Utah ranks number one when factoring in income to cost of living.

We are still really highly ranked, but the housing market here is expensive. And that precisely is the very thing that's breaking a lot of people financially. And look, affordability isn't a matter of being cheaper than California.

[music] It's about whether normal people can live normal lives without falling behind. And when you measure Utah that way, well, something changes. [music] And [music] this isn't opinion.

We're going to look at real numbers. housing, rents, wages, taxes, and lifestyle costs all group together, not just cherrypicked one at a time. Because honestly, that's where most affordability conversations fall apart [music] when we're not looking at the full and the big picture.

And if you get this wrong, you don't just overpay, you lock yourself into a lifestyle that quietly drains you. And if you get it right, Utah can be an incredible place to call [music] home. And here's exactly how this video is going to play out.

I'm going to talk about three major things here. [music] First, I'll show you why Utah feels affordable but really isn't to a great degree. Then, we're going to break down the numbers that most people ignore.

And finally, I'm going to share who Utah actually still works really well for and who should probably avoid Utah or think twice before making the move here. And if we haven't met [music] yet, my name is Scott Steele. I'm a local Uton and I've lived here my entire life and I love sharing content just like this to [music] help guide you to make sure that you're making a really smart decision and making that move to or within the state of Utah.

I'm here to be your real estate resource of choice. And with that said, let's start off with the part that nobody talks about. [music] First, we're going to talk about the comparison trap.

And look, Utah looks cheap, but only when compared to states like California or other West Coast states or states along the East Coast. That's really the only states we're [music] comparing this to, or perhaps Hawaii. But other than that, Utah is not cheap anymore.

And the single biggest driver behind this fact that Utah is not cheap anymore, is of course housing. [music] Housing is incredibly desirable here in Utah. And for that reason, in 2020, in 2021, we saw a 40 plus% runup in the median home price.

What does that mean for the average Joe? That means your average Joe can no longer afford to buy the same home that he used to. [music] Also, in addition to home prices, rents far outpaced wage growth, which is a recipe for disaster in my opinion.

And beyond that, the day-to-day [music] cost of living just rose up so rapidly during that period of time, not only in Utah, but around the country as well. And the truth is, when you benchmark everything against California or Hawaii or New York, pretty much anywhere feels pretty affordable. But that doesn't mean that it's [music] sustainable.

Now, there's one other talking point here I want to cover. Wages in Utah historically were really lagging behind other states. But in the recent 5 to 8year period, wages and salaries in Utah have skyrocketed.

They've shot way up. Now, for those before you start dropping comments in my videos, if you live in Utah and you haven't changed jobs in the last decade, you're probably not realizing this increase, but the average income in Utah has shot up dramatically to the point where we're ranked number [music] eight in the country. And when compared to our current cost of living, which includes housing, we're ranked number one in the country.

Crazy, right? Who would have thought that Utah would rank at [music] the top of the list in that regard? So, why am I sharing this?

What it means is if you have a pretty good income, you can absolutely afford to live here. And collectively, all of the costs that are associated with living in Utah are [music] great compared to most other states, pretty much every other state when you factor everything into it. But that still doesn't mean that moving from a market where your prices are 400,000.

Being shocked and thinking, "Oh, now I've got to spend 600,000 to get the same home. " And look, housing is only the first domino. >> [music] >> Okay, next up we're going to talk about lifestyle inflation that you oftentimes just can't avoid.

[music] Look, living in Utah in such a beautiful place with such an amazing way of life comes with a cost. And the growth that we've experienced over these many, many years, in fact, for the last two decades. Well, it changes how you live, even if you don't want it to.

So, what does this mean? Well, it means longer commutes. It means [music] a little more congestion and more traffic.

It means higher child care costs and increased insurance premiums and utility costs. All [music] of these things factor into the higher cost of living with a growth market. And this is precisely where people think to themselves, I don't even know where my money goes anymore.

I mean, have you visited a grocery store lately, walked [music] out with two bags in your hands, and thought, how is that $100? Because I know I certainly have. So, with all of this said, who is Utah still affordable for?

>> [music] >> Look, [music] affordability is situational. It depends on your personal situation. So, who's it still affordable for?

First of all, it's still affordable for most people if they purchased a home prior to 2020. That's not to say that they aren't feeling the pain of inflation and all of the increased costs with respect to groceries and everything else it takes that factor into cost of living, but you're really well off if you bought your home prior to 2020. In addition to that, you should have an ample amount of equity in that real estate that will help you moving [music] forward as well.

Next up, who Utah still works really well for is if you earn above average income. So, those that make more money than the median income are going to thrive here in Utah. And to answer the question that so many people are asking, I get this all the time.

[music] Who's buying all of these expensive homes? When we look at real estate prices and we look at the prices that houses are selling for, so many people here are thinking to themselves, who can even afford any of these [music] homes? Well, it's these people specifically.

It's those that are earning higher incomes, in other words, higher than the median income that can actually afford to purchase these homes. And there are plenty of them to do so. Hence, the real estate market moves forward and continues to [music] appreciate.

Next up, it's those that work remotely. A lot of times, people have a remote work situation here in Utah, and maybe they're used to getting that higher salary in that higher income area that they used to live, and they're still making more money while taking advantage of living in Utah. For those people, it works incredibly well.

And it also works incredibly well for people that have a scalable income. If you can scale your income, whether you work for another employer or you work for yourself, Utah works really well for that. And finally, if you're flexible on location, this can play to your advantage as well.

If you don't mind living maybe 45 minutes to an hour away, like Eagle Mountain for example, you can get a lot more house for the money. And if you work remotely, you can really enjoy a really high quality of life. [music] And so, in essence, yes, Utah has become unaffordable for many people.

But for the people that choose to live here and [music] that want to move here, Utah simply became more selective. And it's that point of being selective, making sure that you're thoughtful behind where you're choosing to move to that's going to dictate whether you find this to be a success or to be a failure. [music] Now, we've talked about who Utah still works really well for, but [music] who doesn't it work for?

Well, first off, I think the people that are most impacted are firsttime home buyers. Now, [music] I'm happy to report I've helped countless families, especially young people under the age of 30, buy homes in the last handful of [music] months. This is really encouraging to see young people, being able to buy real estate and get into the market when they're really young because time [music] on your side is your best friend when entering a market so that 20 years from now, 30 years from now, 40 years from now, you have something with [music] value.

And another group of people that Utah doesn't work all that well for to a great degree is single inome households. And look, not everybody's blessed with the [music] opportunities that some people have where they can have a single income earner in the family. I'm blessed to have a wife take care of my kids and stay at home, but that's [music] not the case for a lot of people.

The reality is most couples, most households have to have two incomes in order to support the [music] lifestyle and the cost of real estate here in Utah. And it's just not a reality for a lot of people. And the last group of people that Utah doesn't work all that well for is renters without upward mobility.

If you don't have a pathway to earning more money relatively soon, you're probably falling behind [music] every single year. And this is precisely why I think it's so crucial that Utah solves the affordable housing crisis. I think we've got to do a major [music] step forward in making sure that we have increased supply that will offset the demand that we already have and future demand that will be coming [music] so that real estate prices do not continue to skyrocket.

But for all of these people that Utah doesn't work all that well for, this is the group of people where it feels like you just continue [music] and continue to fall behind. [music] So, is Utah still affordable? Well, the true answer is this.

For some people, in some situations, in some locations, yes, it is. But if you came in thinking that Utah is that cheap paradise that it once was, well, reality just might be disappointing. And for those that are coming in expecting it to be expensive, there are actually a lot of ways, programs, and incentives to get into homes that actually will beat your expectations and make sure that you're finding the right home for you specifically.

And that feeling is kind of empowering, especially if you're making that move for the first time in the state of Utah. Then look, if this type of content really helps you, make sure to subscribe to the channel [music] because I put out this type of content every single week to guide you and help you along the way. And as always, my team and I are here to be your real estate resource of [music] choice.

And now that you know who Utah works for and who it doesn't, hopefully that gives you just a little bit of clarity in moving forward. So reach out to me. Let's get the conversation [music] started.

You can find my contact information in the description below. And if you want to learn more about life in Utah, check out these videos next. And until next time, thanks [music] [music] >> [music] [music] >> Heat.