Every state in the nation has seen a seen a spike in the rate of foreclosures over the past several years. The state of Utah is not immune to the fallout from the mortgage crisis which precipitated the millions of homes that have been or are currently in some phase of the foreclosure process. The single difference in Utah is the percentage of residents that find themselves in this most un-envious position.
Among all states, Utah ranks 6th highest as thousands of homeowners receive their notice of foreclosure each month. The single most notable variable that sets Utah apart from other states that rank in the top 10 for foreclosures is the low population of Utah. With a relatively small number of residents, foreclosed homes are less absorbent by the communities as a whole and the greater real estate markets overall.
Utah has been ranked by Forbes list of best states for business as the number one best state in the country. This #1 Ranking is part of the reason that the number of foreclosures in Utah appear at first glance to be worse than in reality. Once the other variables have been added to the equation Utah proves to be the land of opportunity still and should bounce back from the housing crisis faster than most any other state.
What makes Utah such a business friendly state has also contributed to the above average number of foreclosures per household. With new residents moving into Utah in order to take advantage Utah business climate and high paying jobs. Utah has the second highest population growth in the nation with an annual growth of 2.1%; doubling the national average. The majority of growth coming from migration into the state.
The unemployment national average has jumped to 9.6% and Utah has seen its own unemployment figures increase as well, but by a far less degree. Unemployment in Utah is 6.8% a full 30% below the national average and less than half of states with less diverse and less advanced industrial bases such as Michigan and Ohio.
The low unemployment figures in Utah are a direct reflection of the population. Ranking thirty fourth highest population in the United States while ranking thirteenth in total land area gives Utah the advantage of having huge, untapped development potential. This disparity in size of population compared to the size of state creates a misleading numbers regarding the number of foreclosures.
Regardless of its size or population there is no avoiding that Utah has been negatively affected by the recent mortgage meltdown. From Salt Lake, West Valley, Provo, West Jordan, Sandy, Orem, Ogden, Saint George, Layton or Taylorsville or any small town in between, the current real estate market in Utah will take some time to recover. As prices continue their correction experts agree that the bottom will not be reached and recovery begin until the last quarter of 2012. In the meantime there will be thousands of foreclosure deals to be had and any investor that is able to purchase in this market and maintain the property via renting the home will experience an upswing not seen in decades.
As the economy of Utah began its tumble downwards in 2007 along with the rest of the Country, Utah's growing economy took a smaller hit economically than most states but the impact was felt by more of its residents as a small and concentrated population is more effected by disturbances in the market. A full 37% of all residents of Utah live in and around Salt Lake City. This condensed population creates opportunities for investment in the County of Salt Lake and especially the City of Salt Lake.
There is still 63% of the state living outside of Salt Lake and that dispersed population is separated into pockets in and around Utah's relatively few major metropolitan areas. other than Salt Lake the remaining major metropolitan areas are Bingham City, Cedar City, West Jordan, Sandy, Saint George, Provo and Ogden.
Utah offers such as vast array of positives it is no wonder that the population has grown at such as rapid pace in last decade but with such rapid growth comes the possibility of rapid decreases in percentage of population and departure from the state as newer residents return to their states of origin in reliance of their more established support systems. This is made most apparent when measuring the impact of the mortgage meltdown, the low jobless figures compared to the higher than average foreclosure rate.
The prices of homes in Utah will continue to be affected by the percentage of foreclosures and frequency of homes being foreclosed upon. The housing recovery however will likely be somewhat faster in Utah than the national average as the same variables that caused the population to increase in Utah will lead the state out of the housing crisis albeit not at the same pace. Diverse economies similar to Utah should also see a more rapid improvement over states that rely on a large single industry such as Michigan which will take decades longer to see the same improvement.
Foreclosure buying opportunities will continue as interest rates adjust on thousands of sub-prime mortgages that were taken on homes while downward pricing pressure virtually eliminates the possibility of refinancing. Experts agree that this perfect storm of foreclosures will increase over the next several years.
You should be buying foreclosure properties now. Read more about how to buy foreclosures and educate yourself on the communities you are most interested in buying a foreclosure and start shopping here for the foreclosure home that meets your needs. If you are facing a pending foreclosure call a local real estate professional and determine what types of options you have. Your options will depend on your particular situation. Other variables in Utah include where a home is located, density of that areas population, which can vary widely in Utah, how much is owed on the home and how much the particular home is worth in today's market.
Q. What does all this mean to the real estate investor or home buyer looking at foreclosure homes in Utah?
A. It means that housing prices are at an all time low, rehabilitation costs are also reduced as general contractors see additional competition for the same job.
Q. Does the higher percentage of foreclosures mean that opportunities for an investor to sell a home will be fewer?
A. No, in fact Utah has been the land of opportunity for all types of real estate with additional possibilities presenting themselves in the recent mortgage crisis. Utah has historically been a highly desirable destination for millions of migrants for both vacationing and relocation. The continued migration of new residents has slowed but it will return as the economy improves. The current Real Estate market in Utah should result in a greater upside in the near future.
Q. Has the average home in Utah lost more of its value than in other states?
A. Yes, but this is good news as the Real Estate market proves to more profitable in the years to come and opportunities are more plentiful in today's market. As People are more likely to let their home go to foreclosure and walk away the higher the percentage of lost equity and the more upside down they are on their mortgage. Recent Federal initiatives have also created an environment which has placed the majority of the blame on the banks and removed the financial stigma of being foreclosed on.
Q. Why is Utah more affected by the mortgage crisis than other states?
A. With a higher median household income, a relatively small population compared to land area, Utah is uniquely positioned to offer great foreclosure real estate opportunities while offering a high return on investment and therefore less risk associated.