Red-hot real estate market contributes billions to Utah’s economy – Cache Valley Daily

With the average single-family home price in Cache County now exceeding $500,000, it’s no surprise that Utah’s hot real estate market is contributing billions to the state’s gross domestic product. Beehive.

SALT LAKE CITY – It should come as no surprise to anyone that Utah’s real estate market is contributing more to the Beehive State’s economy than any other portion of the business sector.

In the second quarter of 2022, the real estate, rental and leasing industry in Utah contributed more than $29 billion to the state’s gross domestic product, according to a recent report by paper experts of credit at Capitol on Tap.

Coming in second in the same period was Utah’s manufacturing industry, which contributed more than $28 billion, followed by the finance and insurance business, which contributed more than $22 billion.

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“For small business owners,” said Damian Brychcy, chief operating officer of Capital on Tap, “GDP is an important indicator of the overall health and potential for growth of the economy. From that perspective, the outlook is generally positive.”

Utah’s economy mirrors national growth trends in 2022.

The national GDP for all industries in the second quarter of 2022 was $25.2 trillion. The real estate industry contributed $3.1 trillion to that total, which amounts to 12 percent of GDP.

As in Utah, the manufacturing sector also came in second nationally, contributing 11 percent. ($2.7 trillion)

Capital on Tap used data from the US Bureau of Economic Analysis to identify which industries produced the most money in each state, Brychcy explained.

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Here in Utah, the real estate market remains strong through 2022, despite some fatal systemic changes, according to James A. Wood, an analyst at the Kem C. Gardner Policy Institute at the University of Utah.

Declared in 2021, there has been a change in the type of building permits issued across the state, Wood explained, with the construction of multi-family apartments taking precedence over condominiums and single-family units.

With strong demand but fewer single-family units available, prices for those units have risen sharply.

The median price of a new, detached single-family home in the Greater Salt Lake area was $465,000 in 2022, a 36 percent increase.

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Here in Cache County, the median home price has doubled that percentage to $518,648, according to the June 2022 Housing Crisis Task Force report organized by the County Executive David Zook.

Those kinds of fluctuating prices, which have reached record highs, have made real estate difficult for consumers to navigate in 2022, Brychcy said. But those prices are now starting to decline, which is promising for buyers in 2023, as well as for the real estate industry in general.

“I think there is a question about whether that growth (real estate industry) can be maintained in 2023,” Brychcy pointed out. “This is something that everyone needs to follow closely.”


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