St. George tops U.S. in runaway home prices
Houses appreciated by 38.40% for first quarter
For the three months ended March 31, home prices in St. George rose an average of 38.40 percent, compared to the same quarter in 2005, according to the U.S. Office of Federal Housing Enterprise Oversight.
St. George's appreciation was the highest of 275 U.S. cities, surpassing Cape Coral, Fla., at 36.9 percent, Phoenix at 36.52 percent and Bend, Ore., at 34.70 percent. Salt Lake City ranked No. 76 at 16.87 percent.
For all of Utah, home prices increased 14.68 percent in the first quarter, giving the state a No. 15 ranking in house-price appreciation nationally and surpassing the U.S. average rate of 12.54 percent. Utah ranked No. 18 in last year's fourth quarter.
Christopher Kyler, chief executive officer of the Utah Association of Realtors, said the fundamentals of the Utah housing market remain strong.
"I don't believe anything is hyperinflated in Utah," Kyler said. "In fact, the market still may be even playing catchup. When I hear the 15 percent rate of appreciation number for the state of Utah, that doesn't give me a lot of concern. Things are healthy, and I think things will remain healthy for the next few years at a minimum."
Vardell Curtis, chief executive officer of the Washington County Board of Realtors, said news of St. George leading the nation in home-price appreciation far exceeded anticipated projections.
"That surprises me," Curtis said. "The main change that we've noticed in our market has been a tremendous influx of new inventory. The scary part of it is there's more to come."
Allan Carter, director of developer services for Southern Utah Title Co., which tracks overall sales of property and homes throughout Washington County, told the Deseret Morning News earlier this year that by the end of 2006, more than 6,000 building lots would be recorded in that county, a 62 percent increase over the 3,710 lots that were platted in 2005.
Ed Bowler, who sits on the board of directors for Southern Utah Title, said as of April there was a 53-month supply of homes in Washington County priced at $750,000 to $1 million. That's up from a 27-month inventory of the same priced homes as of January.
"I would say we've had a pullback," Bowler said. "I'm not sure I've got the numbers that support that appreciation. I would say prices are plateauing for sure, and perhaps softening."
According to Bowler's analysis of Washington County, total real estate transactions in this year's first quarter were down about 18 percent, falling to 1,427 compared to 1,735 sales in the first quarter of 2005. But he contends the area's core market remains strong.
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