Has Utah been kind to real estate investors over the last few years?
Job Creation Fuels Utah's Growth
For a while now Utah has been the center of growth in the west—with 4 of Utah's cities being rated in the top 10 cities for entrepreneurs.
In the past, we've mentioned that over 5,200 apartments were built in downtown Salt Lake City between 1910 and 2010. And that between 2010 and 2020, another 5,200 will be built.
But now that we're more than half way through 2019, how is Utah meeting this rapid growth?
Utah has a registered vacancy at 3.9 percent for the third year in a row according to CBRE.
"The rate of annual rent growth came in at 5.1 percent, while the average monthly rent across all property classes was $1,157. The greatest rent increases occurred in Salt Lake County, which hit an average of $1,187 through the first six months of 2019."
Utah news station, KSL made a good point recently. While the above average price may seem high to a lot of the locals... those moving from California, NY, Dallas, and Chicago have been very pleased about the pricing because their costs before moving are much higher. As an investor, it is good to see that Utah's growth is coming from these other states because it means that vacancies during rent increases are less likely to change.
What we've seen in recent years is a demand that continues to eat up supply as soon as it is available. That is why the vacancy rates have remained relatively unchanged as investors continue to build new units.
"The market is continuing its record sales volume pace, according to data from the first half of 2019. Sales volume registered at just over $585 million as of mid-year 2019 and is now on track to exceed last year’s historic high of $1.44 billion, the report noted.
Multifamily continues its commanding presence and is the preferred investment vehicle over all other asset types — both locally and nationally" KSL