UNAFFORDABLE UTAH

‘I got frustrated and gave up’: High mortgage rates keep some Utah homebuyers on the sidelines

Apr 24, 2024, 4:50 PM | Updated: 7:04 pm

SALT LAKE CITY — It’s a difficult time for Utah homebuyers as high mortgage rates are keeping some of them on the sidelines.

Mortgage rates sat at nearly 7.4% nationally as of Wednesday afternoon, according to Mortgage News Daily. That’s a difference of hundreds of dollars in monthly payments on a typical Utah home compared to just a few weeks ago.

Breman Nope, a husband and father of four, has been looking for a home for several years. But recently, he stopped.

“I got frustrated and gave up,” Nope said.

Nope said he and his family rent an apartment in South Jordan for $2,700 a month. While he would like to buy a house, he can’t find anything even near that price point because of high mortgage rates.

“Especially because of the way groceries are right now and the cost of feeding a family of six,” he said, “I can’t justify spending that much more on a house.”

Utah has more ‘million-dollar cities’ as home prices climb

Resigned to reality, Nope just re-signed a year lease with the apartment complex – and hopped out of the market.

He’s not alone. Nationally, mortgage applications fell 2.7% last week, according to the Mortgage Bankers Association.

“Mortgage rates continued to move higher last week, reaching their highest levels since late 2023 and putting a damper on applications activity,” said Joel Kan, the association’s vice president and deputy chief economist, in a statement Wednesday. “Purchase applications declined, as home buyers delayed their purchase decisions due to strained affordability and low supply.”

Rick Anderton, a mortgage lender in Orem, told KSL TV “There are a lot of people waiting” to buy a house while rates remain high.

But, he said, he’s also seeing another side.

“I saw more activity—more loan applications this weekend—than I think I’ve seen in the last six months of last year,” Anderton said. “Just in one weekend.”

Anderton said some buyers are choosing to jump in – high rates or not.

“Regardless of rates, I think some people are just done,” said Anderton. “They have to buy.”

Indeed, the “spring wave of house-buying has started,” said Dejan Eskic, housing analyst at the Kem C. Gardner Policy Institute at the University of Utah.

Utahns face higher mortgage rates ahead of spring buying season

Utah’s market is doing better than expected even with higher rates, Eskic said. But with persistent inflation, any real relief seems far away.

“I expect some release later in the year,” Eskic said, “but I’m not as optimistic about that release as I was two months ago.”

As for Nope, he said he will look for a house again, later. He still holds out hope that something – someday – will eventually improve.

“I hate that I’m still in an apartment with a family of six,” he said.

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‘I got frustrated and gave up’: High mortgage rates keep some Utah homebuyers on the sidelines