Are Californians To Blame For Utah’s Surging Home Prices?
Apr 9, 2021, 7:06 PM | Updated: 8:58 pm
SALT LAKE CITY, Utah – It’s a common story heard throughout Utah’s housing industry: Californians are arriving with plenty of cash in hand, outbidding local homebuyers and driving up the costs of housing; but an analysis by the Utah Foundation finds that does not seem to be the reason for steep increases in home and rental prices.
“Why are we seeing these increases? The Utah Foundation has looked whether it might be due in part to any influx of Californians. That does not seem to be the answer,” the report stated.
The rate of people moving into Utah’s larger metropolitan areas is actually down, the report went on to say.
“However, the increase in demand is actually due in part to fewer residents than normal leaving – particularly in the Salt Lake area – thus pushing up housing costs and rent,” wrote Christopher Collard, a senior analyst with the Utah Foundation.
Collard looked at three sources that show where people were moving in 2020: the U.S. Postal Service’s change of address service and moving companies Atlas and United.
“Everybody agrees that people are leaving California,” Collard said. “When we’re looking at the states where most people are moving, it turns out Utah isn’t one of the top ten states, but most of our neighbors are.”
Collard then examined another method to track migration patterns — consumer credit information — and found something interesting.
“The Salt Lake metro area bucked the national trend. It saw the fifth highest growth per 100,000 people out of nearly 100 cities,” the study said. “But is it Californians driving that growth? Not likely.”
Are Californians moving to #Utah to blame for surging housing prices?
A new study puts the blame elsewhere.
“People stopped leaving the Salt Lake metro area at the same rate that had over the previous years” said @UtahFoundation's Christopher Collard.
FULL STORY now on @KSL5TV pic.twitter.com/SLmUceFeEj
— Ladd Egan (@laddegan) April 9, 2021
Unlike other metro areas across the country, the Salt Lake metropolitan area — which encompasses all of Salt Lake and Toole counties — experienced population growth in 2020.
“People stopped leaving the Salt Lake metro area at the same rate that had over the previous years,” said Collard. “It’s kind of functionally the same thing as if we had a big surge of people moving in.”
“Utahns don’t leave because we love it here,” said real estate agent Adam Kirkham
Kirkham, a managing broker with Summit Sotheby’s International Realty and treasurer of the Utah Association of Realtors, said he agrees with the Utah Foundation’s analysis.
“We love to blame California for a lot of things, but in this situation, in-migration of California residents to Utah is definitely happening, but it’s only part of the reason that housing is increasing,” he said.
Kirkham said out-of-state buyers are adding fuel to the fire when it comes to home prices and that homegrown buyers are sometimes at a disadvantage when it comes to how much they are willing or able to spend.
“Typically, a buyer from California is used to a higher-priced home than what they’re going to find here in Utah,” he said.
The moving company Atlas classified Utah as an inbound state for the first time since 1995 and changed California to an outbound state for the first time since 1995.