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April 2021

The Wild Housing Ride p. 10

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Turning Houses into Homes®

Second homes and vacation retreats are now becoming permanent residences p. 20

Table of Contents Features 10 The Housing Market Is Crazier Than It’s Been Since 2006

Nicole Friedman 14 The Agent Behind the First 3D-Printed Listing

Catherine Mesick 20 Vacation Homes Evolve to Meet Hyper Demand

Barbara Ballinger 24 2020 Major Investors 26 The Top 10 Commercial Real Estate Markets for 2021

The National Association of Realtors®

Columns 7 Four Things to Remember When Showing Listings

Matt Ulrich – President’s Message

Departments 8 Happenings 8 In the News 28 Housing Watch

On the Cover: Cover: mikkelwilliam©/ iStock Photo left: iofoto©/ Adobe Stock

This Magazine is Self-Supporting Salt Lake Realtor® Magazine is self-supporting. The advertisers in this magazine pay for all production and distribution costs. Help support this magazine by advertising. For advertising rates, please contact Mills Publishing at 801.467.9419. The paper used in Salt Lake Realtor® Magazine comes from trees in managed timberlands. These trees are planted and grown specifically to make paper and do not come from parks or wilderness areas. In addition, a portion of this magazine is printed from recycled paper.

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The Salt Lake REALTOR® (ISSN 2153 2141) is published monthly by Mills Publishing, located at 772 E. 3300 South, Suite 200 Salt Lake City, Utah 84106. Periodicals Postage Paid at Salt Lake City, UT. POSTMASTER: Send address changes to: The Salt Lake REALTOR,® 772 E. 3300 South, Suite 200 Salt Lake City, Utah 84106-4618.

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Hannah Cutler Coldwell Banker Residential

President Matt Ulrich Ulrich Realtors®, Inc.

Laura Fidler Summit Sotheby’s

First Vice President Steve Perry Wise Choice Real Estate

Amy Gibbons KW South Valley Jennifer Gilchrist Utah Key Real Estate

Second Vice President Rob Ockey Century 21 Everest

Tony Ketterling Equity Real Estate

Treasurer Carlye Webb Summit Sotheby’s

Claire Larson Woodside Homes John Lucky Coldwell Banker Residential

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Managing Editor Dave Anderton Publisher Mills Publishing, Inc. www.millspub.com President Dan Miller Art Director Jackie Medina Graphic Design Ken Magleby Patrick Witmer

Sales Staff Paula Bell Paul Nicholas

Office Administrator Cynthia Bell Snow

Salt Lake Board: (801) 542-8840 e-mail: dave@saltlakeboard.com Web Site: www.slrealtors.com The Salt Lake Board of REALTORS® is pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the nation. We encourage and support the affirmative advertising and marketing program in which there are no barriers to obtaining housing because of race, color, religion, sex, handicap, familial status, or national origin. The Salt Lake REALTOR® is the monthly magazine of the Salt Lake Board of REALTORS®. Opinions expressed by writers and persons quoted in articles are their own and do not necessarily reflect positions of the Salt Lake Board of REALTORS®. Permission will be granted in most cases, upon written request, to reprint or reproduce articles and photographs in this issue, provided proper credit is given to The Salt Lake REALTOR®, as well as to any writers and photographers whose names appear with the articles and photographs. While unsolicited original manuscripts and photographs related to the real estate profession are welcome, no payment is made for their use in the publication. Views and opinions expressed in the editorial and advertising content of the The Salt Lake REALTOR® are not necessarily endorsed by the Salt Lake Board of REALTORS®. However, advertisers do make publication of this magazine possible, so consideration of products and services listed is greatly appreciated.

Four Things to Remember When Showing Listings Professionalism matters, especially in a frenzied real estate market like this one. Realtors® should pay close attention to these four areas: 1. Only show homes with permission. Showing a home without permission of the seller is trespassing and an ethics violation. Home sellers can be caught off guard or put in embarrassing situations when a buyer’s agent doesn’t secure permission to show a property. Even if a home is vacant, permission is needed. Listing agents can add an extra measure of security to a seller’s home by enabling a CBS (call before showing) code. When this feature is enabled on the Supra Keybox, agents who are seeking access to the key will be asked to provide a code after entering their PIN. Agents who want to show the property will need to contact the listing agent for the code. 2. Remember to lock doors and secure the listing key to the Supra Keybox. Kellie Tinnin, career development director for ERA Sellers & Buyers Real Estate in Albuquerque, New Mexico, tells of a time she listed a home in a popular Albuquerque neighborhood. “One morning, I received a call from the police department,” Tinnin recalled. “An intruder had turned my client’s home into his retreat, and a half-day standoff with the authorities followed. After several gas bombs and the presence of a police tank, the intruder gave up. My seller was lucky there was minimal damage to the property. It is hard to say if the situation could have been avoided or not. I know it would have been harder for the intruder gain access to my listing if the agent who had shown the property the evening before had locked the door when leaving.” 3. Agents are ultimately responsible for their clients when viewing a seller’s home. When a client touches personal items during a showing, or worse, takes something from a home, ultimately the Realtor® is liable. Remember to set clear boundaries with buyers before viewing properties. 4. Assume that you are being watched. Security cameras are everywhere. If you are showing a home, chances are you are being watched or recorded. Many homes today have security cameras or even hidden cameras that capture everything. Keep confidential discussions between your clients away from listings. Remember, simple respect can avoid big problems.

Matt Ulrich President

OFFICIAL PUBLICATION OF THE SALT LAKE BOARD OF REALTORS ® REALTOR® is a registered mark which identifies a professional in real estate who subscribes to a strict Code of Ethics as a member of the NATIONAL ASSOCIATION OF REALTORS®. October 2005

April 2021 | Salt Lake Realtor ® | 7

Happenings

In the News More Homeowners are Remodeling Many Americans turned their attention to their homes during the pandemic. Home improvement big-box retailers reported a swarm of traffic as homeowners looked to spruce up their nests while sheltering in. What were homeowners working on? Outdoor spaces were fueling much of the demand, according to Houzz, an online home remodeling platform. For example, new decks or patios, pools, and fences have gotten a lot of attention.

Salt Lake County’s Median Single-Family Home Price Could Exceed $500,000 within 15 Months The median price of a single-family home in Salt Lake County in the fourth quarter increased to $438,000, a nearly 15 percent rise compared to the same period in 2019. Based on annualized appreciation trends, the median price of a single-family Salt Lake home could exceed $500,000 within the next 15 months. The median price of a multi-family home in the county climbed to $326,819, a nearly 17 percent increase year over year. Home sales in the county accelerated in the final quarter of 2020. There were 3,709 singlefamily homes sold, a 13.4 percent increase over the fourth quarter of 2019. Multi-family home sales skyrocketed, with 1,521 condos, twin homes, and townhomes sold in the quarter, a 29.1 percent rise year over year. New listings in the fourth quarter were 12 percent higher than a year earlier. This contributed to 2020’s record breaking sales. Nearly 19,200 homes were sold in Salt Lake County in 2020, the highest number for a calendar year in the history of the MLS.

Homeowner Justin Sullivan shared with CNBC his feelings about his pool, home gym, and sauna projects. “When you’re not able to go out, your house is an enjoyable space where you can live bunker-style and still be active, still feel comfortable, and still enjoy,” Sullivan said. “The kids will have spaces to make sure they can work from home, and when it gets really hot in the summertime, they’ll have a place where they can cool off.” Also, demand for interest in fence installation and repairs jumped 166 percent, Houzz noted. The desire for more space has been common for homeowners during the pandemic. That may explain why Houzz has seen a 52 percent increase in professionals being called in for home extensions and additions. Kitchen and bath remodels also have been popular, seeing a 40 percent jump in demand in June compared to a year ago, Houzz reported.

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Unemployment Rates in February Fall in Many States Utah had the second lowest unemployment rate in February, according to the U.S. Bureau of Labor Statistics. Just 3.0 percent of Utahns were unemployed. Nationally, the unemployment rate was 6.2 percent. South Dakota had the lowest rate at 2.9 percent. Hawaii and New York had the highest unemployment rates in February, 9.2 percent and 8.9 percent, respectively. Unemployment rates were lower in 23 states and the District of Columbia, higher in 4 states, and stable in 23 states.

8 | Salt Lake Realtor ® | April 2021

Homeowners don’t appear to be done sprucing up their nests. More than three-quarters of homeowners recently surveyed say they plan to tackle a new house project over the next 12 months, according to Porch.com, a home remodeling website. Their top motivators were “finally having time,” “adding value to the home,” and a desire to make their home “feel more cozy.”

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The Housing Market Is Crazier Due It’s to limited this story is only available in Than Beenrights, Since 2006 ®

the print issue of the Salt Lake Realtor magazine.

Limited inventory, low interest rates and bidding wars are driving A copy of this is available on the Wall Street prices sky-high. Manyarticle homeowners are reluctant to sell because they worry about competing home in the same market. Journal website for butanother charges may apply. By Nicole Friedman

Less than a day after real-estate agent Andrea White listed a three-bedroom home for sale in Sacramento, Calif., in March, she received an allcash offer. The buyer—who had not even seen the home in person—was ready to pay $520,000, Ms. White said. That was $21,000 above the asking price and 37 percent more than the seller had paid for the ranch-style home only two years ago. Accepting the offer was the easy part. Ms. White then had to call 17 other agents who had scheduled tours of the house to let them know it was off the market. Ms. White, who works for brokerage Redfin Corp. and has been an agent since 2014, has never seen anything like the sales mania gripping her Northern California city. “It’s exhausting,”

10 | Salt Lake Realtor ® | April 2021

she said. “I’m speechless. It’s heartbreaking for buyers; it’s celebration for sellers.” The past year has been the hottest for sales activity in 14 years. Home values are rising in practically every corner of the U.S., and median sale prices in dozens of metro areas have posted double-digit percentage increases from a year ago, according to Zillow Group Inc. In Boise, Idaho, the median sale price rose almost 25 percent in January from a year earlier, while in Stamford, Conn., it rose 19 percent. “Prices are up virtually everywhere,” said Mark Vitner, senior economist at Wells Fargo & Co. “It is surprising to see home prices rebound this quickly, by this magnitude, this early into an economic recovery.”

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While the pace of home price gains has been dizzying, it’s not hard to understand what is driving the frenzy. Mortgage rates sit near historic lows. Millions of millennials are entering their early 30s, the typical age of first-time home buyers. And the pandemic has spurred new demand: Some buyers want more space Due to limited rights, this to work from home while others are willing to move farther from their offices. Many story is only available inworkers the who kept their jobs in 2020 were able to save print issue of the Lake up for down payments due Salt to stimulus checks, ® student loan payments and less forbearance on Realtor magazine. spending on travel and entertainment.

A copy of this article is

Supply, meanwhile, has never been tighter. available on theplummeted Wall Street New-home construction during the 2007-09 recession and remained low in the Journal website but charges following years. Homeowners are also staying in their houses longer, in part because aging baby may apply. boomers are staying healthier later in life and choosing not to downsize. The number of homes for sale in March was roughly half of what it was a year ago, according to Realtor.com. In Austin, Texas, Jacksonville, Fla., and Raleigh, N.C., the year-over-year inventory decline topped 70 percent. (News Corp, parent of The Wall Street Journal, operates Realtor.com.) The market has rarely been this competitive, especially for first-time home buyers or those with limited budgets. Bidding wars are common, and new listings don’t last for long. Nearly three in every four homes sold in February sat on the market for less than a month, according to the National Association of Realtors®. Single-family house prices across the nation rose 12 percent in January from a year earlier— marking the biggest annual increase in data

12 | Salt Lake Realtor ® | April 2021

going back to 1991, the Federal Housing Finance Agency said this week. All nine regions of the country tracked by FHFA posted year-over-year price gains of more than 10 percent. In February, the median existing-home price rose 15.8 percent from a year earlier to $313,000, NAR said. But even with house prices rising quickly, many homeowners are reluctant to sell because they worry about competing for another home in the same market, said Daryl Fairweather, chief economist at Redfin. With mortgage rates so low, many households decided to refinance last year instead of moving. More inventory could come on the market this spring, which is typically the busiest season for home sales, real-estate agents say. But there are unlikely to be enough new listings to cool the market. Nationally, there was a two-month supply of homes on the market at the end of February, according to NAR, near an all-time low. Even high-priced cities where sales plunged last spring are showing signs of growth. Manhattan co-op and condo sales in the first quarter of 2021 exceeded year-earlier levels for the first time in four quarters, according to brokerage Douglas Elliman. In San Francisco, home sales in February rose 19 percent from a year earlier, according to Redfin. Home builders are trying to increase construction to meet the booming demand. New construction has rebounded from its recession-era lows in recent years, but the nation still has a shortage of millions of units. Home-building activity slowed last spring and ramped up over the summer. But the construction pace is limited by high lumber

costs, material bottlenecks and a shortage of land and labor, according to builders and economists. Buying interest is so strong that many builders are restricting how many homes they sell at a time. They want to make sure they don’t sell more than they can build. Economists and executives expect demand to remain robust this year, and they anticipate the demographic-driven strength to continue for years as the large millennial and Gen Z generations get older. Still, there have been some recent indications that price growth could slow as more homes come on the market. Rising mortgage rates—which sit at the highest level since June and have been climbing steadily in recent weeks—could price some buyers out of the market later this year. Even buyers exhilarated by the prospect of owning their first home have been wiped out by the undertaking. Samantha and Doug Hawkins, both 32 years old, moved out of their one-bedroom apartment in Boston when the pandemic struck and into Ms. Hawkins’s parents’ house. They built up their savings by not paying

rent, and Ms. Hawkins paid off her student loans. But when they started house hunting late last year, they found it tough to compete against other bidders. They were told that sellers wouldn’t consider offers with down payments of less than 20 percent, said Ms. Hawkins, who works in human resources. After increasing their budget and expanding their search area, the Hawkinses had their sixth offer accepted in March, for a four-bedroom house in Westford, Mass., farther from Boston than they had originally looked. They’re under contract and expect the deal to close in June. “We’re really proud that we’re able to do this, and excited to take the next step in our lives,” Ms. Hawkins said. “But to have it be such a competitive market…. It’s just taken a little bit of the joy out of the process.” Reprinted by permission of The Wall Street Journal, Copyright © 2021 Dow Jones & Company, Inc. All Rights Reserved Worldwide. License number 5042591213239.”

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The Agent Behind the First 3D-Printed Listing 3D technology could make home construction mainstream. The process is three times faster than traditional wood-frame construction and reduces construction costs by as much as 70 percent. By Catherine Mesick Stephen King’s cellphone began ringing almost immediately on Jan. 25 after he submitted the listing information for the Riverhead, N.Y., three-bedroom, two-bath home to the MLS. The flurry of interest wasn’t merely because wellpriced new-construction properties were hard to come by in his Long Island market. The listing itself was a notable feat: the nation’s first legally permitted 3D-printed house to appear on a multiple listing service. Considering the exciting technology involved, it was little surprise that CNBC, CNN, and Fox Business were clamoring for an interview with King, a salesperson with Realty Connect USA in Patchogue, N.Y., and a 2021 30 Under 30 honoree with the National Association of Realtors®. King was also inundated with calls from potential buyers drawn to the affordable $299,999 price tag for the 1,400-square-foot house. “On Long Island,” said King, “inventory doesn’t exist for $300,000 or less.”

14 | Salt Lake Realtor ® | April 2021

By early March, the house was under contract, even though it had yet to be built—errr, printed. A rendering of the three-bedroom home that’s expected to be printed in April. King said that he and SQ4D, the Patchogue, N.Y.–based 3D printing company that will produce the Riverhead house, received “hundreds of offers,” adding that it took some time to sift through all the potential clients. According to King, it was important to the builders to have the home be owner-occupied, rather than sell it to an entity that would buy it as an investment property and rent it out. Thanks to upgrades to be provided by local businesses, King said, the house sold for more than its asking price, though he adds it still went for less than market value. Affordability is critical in a time when the U.S. remains mired in a housing shortage. National (continued on page 18)

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3D Technology (continued from page 14) housing inventory plummeted 49 percent in February compared with the same month last year, and median home prices also rose 13.7 percent annually, to $353,000 in February, according to a recent realtor.com® report. Strong buyer demand and low interest rates are driving prices up. But the soaring cost of materials is also a contributing factor. According to the National Association of Home Builders, lumber prices have risen 180 percent since April 2020, adding an estimated $24,000 to the price of the average new single-family home. 3D printing offers a solution to these issues, said Lawrence Ruisi, who serves on the board of directors of SQ4D. Printing for the Riverhead home is slated to begin in April; the house should be ready to move into in June. The company’s autonomous robotic construction system squeezes out concrete like toothpaste to create the structure of the house, including the footings, foundation, interior and exterior walls, and utility conduits, which make up 41 percent of the finished product. The process is three times faster than traditional wood-frame construction and reduces construction costs by as much as 70 percent. Only three laborers were required from SQ4D to create the model version of the Riverhead house, said Ruisi, which was printed in 48 hours. The roof, electricity, HVAC, and communications were added after printing, bringing total construction time to a few weeks. The results, Ruisi said, are revolutionary in the construction world, which, unlike the telecom and computer industries, has remained largely

18 | Salt Lake Realtor ® | April 2021

static. “We build the same as we did seventy-five years ago,” he said. “We wanted to find a way to build homes for less.” Getting the Riverhead listing ready to market has taken time—in fact, more than three years. According to King, the builders had to identify a town that would issue a certificate of occupancy, purchase land there, and print test models. Zoning wasn’t really an issue, he said, since the house was a standard concrete construction. “The challenge was in the inspection,” King said. “Inspectors are used to coming out to a project for an hour once every two to three months to inspect each process as it’s completed. That doesn’t work when you can print a structure in 48 hours. We had to find a place that could get creative with the inspection process and adjust the schedule.” King was brought into the project early through a networking group he’s involved in. “The owner of SQ4D reached out to me to pick my brain,” he said. “I jumped at the chance to be involved.” When asked what an agent needs to know to sell a 3D-printed house, King laughed. “All I can say is, ‘all hands on deck.’ This is all new, and there are many things we can’t predict.” As for marketing, King said that the Riverhead house essentially sold itself. “My marketing can’t touch the power of the national media.” King has been showing clients the model home that was completed for the town of Riverhead to convince them of the project’s viability. When the publicity began, area businesses donated upgrades to the house, such as windows, doors,

countertops, and solar panels, all of which will be incorporated into the finished home, he added. King’s listing may usher in a new era of 3D-printed homes that will soon be available on a wider scale. Construction tech companies Mighty Buildings in Oakland, Calif., and ICON in Austin, Texas, have produced 3D-printed houses, but they’ve apparently not been marketed on an MLS. Mighty Buildings has sold several 3D-printed houses using a modular home model. The homes range in size from 400 to 1,400 square feet, and customers can order the houses online and have them shipped and installed—but the customer has to provide the land. Mighty Buildings is also planning a community of 3D-printed homes to be completed next year in Rancho Mirage, Calif. In March of 2020, ICON completed the 3D-printed Community First! Village in conjunction with the nonprofit Mobile Loaves & Fishes in Austin. The community was planned to provide housing for people transitioning out of chronic homelessness; the first resident moved in last September. ICON announced on March 4 that it is offering partially 3D-printed homes for sale in Austin

in conjunction with the Kansas City, Mo.–based developer 3Strands. The community, East 17th Street Residences, comprises four homes that have a 3D-printed first floor and a traditionally constructed second floor. According to the community’s website, one house has sold already and another is under contract. ICON even has plans to take construction to a higher level—literally. The company has received funding from NASA to begin research and development of a space-based construction system that could support future exploration of the moon. As for the future of homebuilding here on Earth, King said it’s already arrived. “3D technology has to become mainstream,” said King. “Rarely do you get cheaper, better, faster, stronger all at the same time.” Catherine Mesick is a writer and a member of the National Association of Realtors® Advocacy Group. She can be reached at cmesick@nar.realtor. Reprinted from Realtor® Magazine Online, March 2021, with permission of the National Association of Realtors®. Copyright 2021. All rights reserved.

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April 2021 | Salt Lake Realtor ® | 19

Vacation Homes Evolve to Meet Hyper Demand Second-home locations—viewed as a safe destination when the pandemic disrupted how people live—have gained full-time residents, and houses are changing to meet the demand. By Barbara Ballinger As COVID-19 spread, many people made a beeline to their more isolated second homes or vacation rentals to hunker down and stay safe. Slowly, the idea that those destination homes would be short-term gave way to the notion of making them a permanent residence. People enjoyed the safety, space, fresh air, and outdoor recreation at their retreats. They found efficiency working remotely and having their children learn virtually. And many found it propitious to buy with low interest rates and a strong stock market. “Buying a house is a feel-good purchase, and it became the right time after many put it off,” said Diane Saatchi, associate broker with Saunders & Associates in East Hampton, N.Y. Since the pandemic started, Mimy von Schreiner with John R. Wood Properties in Southwest

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Florida, has had three clients purchase vacation homes who then made them permanent residences.

Less Inventory Whether homes are for full- or part-time use, all the demand has led to a dearth of inventory, now exacerbated by the spring buying season and many people planning their summer vacations. Along Utah’s Wasatch Front, active listings in early April were down 77 percent from a year earlier. Utah, along with other mountain states of the West, is the beneficiary of a renewed affordability migration. “With home prices soaring and remote working the new norm, Americans have been taking a hard look at where they live – and many have decided

lower price. “Many don’t anticipate going back and forth as frequently, if at all,” said Jennifer Grimes, whose Red Cottage Inc. in Grahamsville, N.Y., offers vacation rentals, and her Country House Realty represents homes for sales in the Catskills. In the last year, she’s seen her rural Sullivan County become the epicenter of escape for people coming from New York City, 110 miles away. “It was last to the party in popularity after better-known Dutchess, Ulster, and Orange counties, but interest has surged as a destination and demand has far outpaced supply,” she said. To meet demand in recent years, Grimes has added 10 agents. Architect Mike Aziz, AIA, a partner at New York City-based Cooper Robertson, an architecture and urban design firm, says many of his firm clients will drive farther, as well—two to three hours from a major city, especially for a primary residence. The same is true on the West Coast where Chris Neighbor, president of SummerHill Homes in San Ramon, Calif., sees huge interest in his firm’s infill townhouses from tech workers leaving the expensive Bay Area and their tiny apartments.

to move out of pricey coastal markets,” Jeff Ostrowski, an analyst at Bankrate.com, said in a written statement. Von Schreiner said inventory in her market is down 56 percent from a year ago, which she attributes to frenzied pandemic sales and rentals, an expanded pool of younger buyers, and existing homeowners staying put. Deb Martin, CEO of ERA Cape Cod Real Estate in Denis, Mass., has also seen inventory shrink for similar reasons. But those reasons are compounded by another trend beginning before the pandemic: retirees not selling as they once did to move near grandchildren or head to senior-living facilities. Because of these tough market conditions, agents must help clients by encouraging them to prioritize their wish lists, stay on top of what’s available, and communicate often. These five questions will help real estate pros guide the discussion. 1. How far from your current home are you willing to go? Many buyers and renters now are willing to travel farther to find the right home and a

“The average tech employee no longer works on a campus for 14 hours a day. They can get more space,” he said. In other markets, particularly for long- and shortterm rentals, some people are now willing to drive to rural sites once under the radar, such as parts of Kentucky, Michigan’s upper peninsula, and the area around Deep Creek Lake, Md., said Jeffrey Breece, whose San Francisco-based Beyond Pricing firm manages rental properties. 2. Does peak season matter to you? Many locations are experiencing extended rental seasons with bookings made further out than pre-COVID-19. For example, in Florida, salesperson Angela Waldrop with Dale Sorensen Real Estate in Vero Beach, has seen bookings extend beyond the typical April 30 cutoff into summer. “Except for a minor blip when the coronavirus emerged, we’ve not had a break. Many people also book for longer three- to sixmonth periods,” she said. Jason Milovich, broker-owner of Bluefish Vacation Rentals in southwest Michigan, about 74 miles from Chicago, has also seen lines blur between high and low seasons. “The busiest rental time used to be from Memorial Day through Labor Day, followed by a shoulder through November. But it has stayed busy from last December until now,” he said. The difference in rental costs has also diminished

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between the high season, weekends, and holidays, and the low season and weekdays, Grimes said. Even the idea of a best time to buy has vanished. “Sales now happen at all times if there’s inventory,” Waldrop said. 3. What’s your price range? With little inventory, houses often sell at full price or above, and oftentimes on the day listed. “Buyers tire of repeatedly missing out, and many overpay to make a sale work,” Grimes said. As an example, she cited a property listed at $425,000 that went 35 percent higher for $575,000 without an inspection three days after hitting the market. It was seen by 25 potential buyers, and the winning bid was all cash. In von Schreiner’s Florida market, average sales prices in January were up 18.2 percent from a year ago, she said. Neighbor has seen listings in his California area climb 20 percent above the asking price with as many as eight to 12 offers. Rental costs reflect a similar uptick. “Many are going 25 percent above the (normal) price. A pool brings a premium,” Breece said. In Waldrop’s Florida market, luxury homes have been renting “nonstop” since the start of the pandemic, she said, for $20,000 to $35,000 monthly, or 30 percent above a year ago. 4. What types of homes and amenities are you looking for? Single-family homes generally appeal more than condos since they eliminate sharing elevators, lobbies, pools, dog parks, and gyms.

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Exceptions abound, especially when designs focus on keeping renters or buyers apart. Developer Valor Capital, which is constructing Serena by the Sea in Dunedin, Fla., near Clearwater, went back to the drawing board when the pandemic hit to add touchless features, individual condo air-intake systems, and a concierge service to deliver spa treatments, walk dogs, organize closets, said Regina Sotomayor, chief sales officer. More than half the 80 units have been pre-sold. When it comes to homes, many buyers and renters seek greater square footage to accommodate more family and fit their new mindset. “They no longer think of it as a vacation house but a primary home that needs to be comfortable for long-term,” Saatchi said. That was the case with the home that designer Staci Munic bought when she switched her primary residence from Chicago to Palm Springs, Calif., and sold a California condo that was previously her vacation getaway. “I found I loved being here and having a relaxed lifestyle with morning bicycle rides,” she said. But she was glad she rented first. “It gave me the opportunity to experience an area in different seasons and alleviate buying under pressure,” she said. Other buyers who don’t know whether their home will be temporary or permanent also desire more space. “About 95 percent of SummerHill’s buyers are first-time homeowners who like getting a second bedroom, office, fireplace, space for their Peloton bicycle, and balcony—especially after years of renting a tiny apartment,”

Neighbor said. He expects many will stay postpandemic, even if they commute occasionally to a corporate office. For Tish Horton, a warmer winter climate and chance to live near a daughter drew her to a second home in Newland’s masterplan Nexton community in Summerville, S.C., 30 miles from Charleston. She plans to commute to her other home and daughter in Dayton. Working from home has led people to stay longer, often with extended family members. Buyers and renters alike are looking for Zoom nooks and smart designs for ease of daily living. Other amenities in high demand are garages, ample storage, fenced yards (for pandemic-era adopted pups), closed rather than open kitchens, greater access to outdoors, and wellness programs. “Well-living is the new green,” said Manny Gonzalez, AIA, LEED AP, principal at KTGY Architecture + Planning’s Los Angeles office. “People look for air and water filtration, home monitoring, and sustainability.”

said. Milovich says his area’s listings with pools already are booked. Yet, some of the any-price-goes mentality is beginning to wane, Saatchi said. “I see more buyers get sober, stick to a budget, and decide not to bid up prices so high,” she said. Fall may bring a return to what’s more normal, Milovich said. “It still should be strong but not quite what it was a year ago.” Barbara Ballinger is a freelance writer and the author of several books on real estate, architecture, and remodeling, including The Kitchen Bible: Designing the Perfect Culinary Space (Images Publishing, 2014). Barbara’s most recent book is The Garden Bible: Designing Your Perfect Outdoor Space, co-authored with Michael Glassman (Images, 2015). Reprinted from Realtor® Magazine Online, April 2021, with permission of the National Association of Realtors®. Copyright 2021. All rights reserved.

Living in a conservation-minded development where all houses are focused on those principles is another option gaining traction, Aziz said. As an example, he cites architect Drew Lang’s Hudson Woods with 26 modern, sustainable homes on 131 forested Catskills acres. Also, the more turnkey a listing, the greater the appeal since it’s become harder to find contractors and materials. 5. What amenities are you looking for in nearby towns? Depending on the location, more stores are remaining open during what were once nonpeak times because of the increased traffic. Waldrop attributed the popularity of her area’s Central Beach downtown to the bustling activity of an open farmer’s market, ice cream shops, restaurants, and parks. In the Hamptons, art galleries have opened after testing the waters with pop-ups, said Saatchi. The Cape, once empty in winter, is experiencing growing pains as residents seek services, said Martin. “The Cape is going to have to pivot and figure out how to do this,” she said. In Harbor Country Michigan, increased population has led to a need for more trash pickups, said Milovich. In Palm Springs, the dining scene has ratcheted up, Munic added.

What’s Ahead in Hot Markets

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For now, the pace remains dizzying. “In the first two months of this year, Grimes’ rental company hit 50 percent of its total 2020 revenue,” she

April 2021 | Salt Lake Realtor ® | 23

The Top 10 Commercial Real Estate Markets for 2021 By The National Association of Realtors® The National Association of Realtors® identified the top 10 commercial real estate markets for 2021. In alphabetical order, the markets are: Austin-Round Rock, Texas Cape Coral-Fort Myers, Florida Charleston-North Charleston, South Carolina Las Vegas- Henderson-Paradise, Nevada Nashville-Davidson-Murfreesboro-Franklin, Tennessee Phoenix-Mesa-Scottsdale, Arizona Raleigh, North Carolina Salt Lake City, Utah Seattle-Tacoma-Bellevue, Washington Tucson, Arizona “The top commercial real estate markets that are expected to outperform the rest of the nation are generally affordable and able to draw new residents with a greater flexibility to work from home,” said NAR’s Chief Economist Lawrence Yun. “These growing markets also offer much lower office and retail rents and are, therefore, able to attract new and expanding businesses.” NAR selected the top 10 markets after considering 25 indicators on an area’s economic, demographic, housing and commercial market conditions in the multifamily, office, industrial, retail and hotel property sectors. Some of the (continued on page 30)

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FEBRUARY HOUSING WATCH Low Inventory Causes a Drop in February Home Sales

“Despite the drop in home sales for February – which I would attribute to historically-low inventory – the market is still outperforming prepandemic levels,” said Lawrence Yun, NAR’s chief economist.

Home sales in Salt Lake County in February fell nearly 8 percent because of record low inventory levels. There were 1,087 sales of all housing types in the month, down from 1,180 sales in February 2020. In the first two months of 2021, home sales were down 0.3 percent compared to the same period in 2020. Overall inventory of homes for sale in Salt Lake County in February fell to 1,091 units, down 54 percent from 2,352 units in February 2020. Pending sales for the month fell 10 percent to 1,125 contracts signed, down from 1,248 contracts signed a year ago.

Nationally, sales decreased 7 percent from January to a seasonally-adjusted annual rate of 6.22 million in February. Yet, sales in February increased 9 percent year over year, according to the National Association of Realtors®. “Despite the drop in home sales for February – which I would attribute to historically-low inventory – the market is still outperforming pre-pandemic levels,” said Lawrence Yun, NAR’s chief economist. He cautioned of a possible slowdown in growth in the coming months as higher prices and rising mortgage rates will cut into home affordability. “I still expect this year’s sales to be ahead of last year’s, and with more COVID-19 vaccinations being distributed and available to larger shares of the population, the nation is on the cusp of returning to a sense of normalcy,” Yun said. “Many Americans have been saving money and there’s a strong possibility that once the country fully reopens, those reserves will be unleashed on the economy.” Salt Lake County’s median home price jumped 14 percent in February to $410,000, up from $360,000 a year earlier. The median U.S. existing-home price for all housing types in February was $313,000, up 16 percent from February 2020 ($270,400), as prices rose in every region. February’s national price jump marks 108 straight months of year-over-year gains, according to NAR. Across the country, first-time buyers were responsible for 31 percent of sales in February, down from 33 percent in January and from 32 percent in February 2020.

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April 2021 | Salt Lake Realtor ® | 29

Top 10 Commercial Real Estate Markets (continued from page 26) indicators included GDP growth, unemployment rate, median household income, consumer spending, number of business openings, population growth, homeownership rate, rental vacancy rate, building permits and apartment rent, among other variables. NAR unveiled the top commercial markets during its first-ever Commercial Real Estate Forecast Summit. The event featured a panel of leading economists who discussed the pandemic’s impact on commercial real estate, including, the multifamily, office, retail and industrial sectors as well as real estate investment trusts, or REITs. Yun predicted that the U.S. economy will continue to improve in 2021 and expects the commercial real estate market will follow. “A recovering economy and the near certain job growth will steadily lead to the absorption of commercial properties,” Yun said. “The apartment rentals market could once again experience very low vacancy rates by year’s end.”

solid operating fundamentals when the crisis erupted. “Some sectors have been harder hit, especially lodging, resorts and retail REITs, while sectors that support the digital economy - including data centers, cell towers and industrial and logistics facilities - have enjoyed a surge in demand.” Gay Cororaton, NAR’s senior economist and director of housing and commercial research, anticipates the multifamily, industrial and retail sectors will drive the commercial real estate recovery this year, but says it may take longer for office occupancies to reach pre-pandemic levels. “Multifamily and industrial remain the commercial market’s bright spots,” Cororaton said. “With wide differences in commercial and apartment rents across metro areas, development will turn to less expensive markets that are closer to the gateway cities. “However, office vacancy rates will remain elevated, even with full office-job recovery by the middle of 2022, due to some shifting toward a nationwide work-from-home culture.”

Calvin Schnure, Nareit’s senior vice president of research and economic analysis, explained that REITs have performed well overall in spite of COVID-19, although some variance exists depending on the market segment.

“I expect continued retailer fallout,” added Brandon Hardin, NAR’s research economist. “And as tactical store closures and bankruptcies increase, adaptive reuse and conversions will create opportunities for investors and developers.”

“The impact of the pandemic on commercial real estate varies widely across property types,” Schnure said. “REITs have been resilient due to their strong balance sheets and liquidity and

The National Association of Realtors® is America’s largest trade association, representing more than 1.4 million members involved in all aspects of the residential and commercial real estate industries.

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