Monday Report
Wasatch Front Qtr 1.08 Housing Summary May 26th, 2008

Bonneville Research Website




Wasatch Front Housing Market

Utah's real estate market continues to cool down from record levels as First Quarter 2008 data indicates. Buyer apprehension, coupled with tighter lending restrictions have dampened new home sales along the Wasatch Front. New home inventory continues to maintain high levels, with a large percentage of complete unoccupied homes (standing inventory). Additionally, new home closings posted a decline compared with previous quarters. However, bright spots remain, as job growth continues and interest rates are still considered to be favorable.

Wasatch Front Housing Summary - Qtr 1.08

1/01/2008 - 3/31/2008

CountyVacant LotsHomes Under ConstructionComplete UnoccupiedNew Home Closings
Salt Lake5,9511,111977 715
Washington5,33344 6348228

Source: NewReach - Builders Decision

New Home Closings

The number of new home closings within the Wasatch Front continues to see declines. Tighter lending standards and steep price appreciation forced many first-time buyers out of the market. Buyer apprehension continues to feed the problem. However, price reductions have resulted, thus increasing buyer traffic and new home reservations. With this indicator, new home closings show signs of future improvment. Although we cannot expect the same sales volume experienced in 2005-06, improvement can be expected.

Wasatch Front Housing Summary - Qtr 1.08

Top 15 Projects - New Home Closings

RankProjectQtr 1 .08CityProduct Type
1Daybreak81 South JordanAtt/Det
2The Ranches69Eagle MountainAtt/Det
3East Town Village54Midvale Attached
4Heights on Quarry Bend41Sandy Attached
5Zermatt36 MidwayAttached
6Silver Lake33Eagle MountainDetached
7Bellevue29 DraperDetached
8Village on Dimple Dell28Sandy Attached
9Harvest Hills25Saratoga SpringsAtt/Det
10Belle Monet24Pleasant GroveAttached
11Whistler Ridge23Orem Attached
12Suncrest22 DraperAtt/Det
13Cambria21 Pleasant GroveAttached
14Rose Creek Crossing20Riverton Attached
15Rosecrest 19HerrimanAtt/Det

Source: NewReach - Builders Decision


  • Plow & Hearth
  • Plow & Hearth operates nine locations throughout MD, NC and VA.
  • The stores, offering unique products for the home and garden, occupy spaces of 6,000 sq.ft. to 8,000 sq.ft. in freestanding locations.
  • Growth opportunities are sought nationwide during the coming 18 months, with representation by Winick Realty Group.
  • The company prefers to locate in high traffic areas in downtown business districts.
  • Major competitors include Home Depot.
  • For more information, contact
    • Jeff Winick,
    • Winick Realty Group,
    • 655 Third Avenue, 8th Floor,
    • New York, NY 10017
  • Western Tool Supply
  • Western Tool Supply, Inc. trades as Western Tool Supply at 75 locations throughout CA, CT, ID, MA, ME, MT, NH, NV, NY, OR, UT, VT, WA and throughout Alberta, British Columbia and Saskatchewan, Canada.
  • The stores, offering tools for construction, machinery and woodworking fields, occupy spaces of 5,000 sq.ft. to 10,000 sq.ft. in freestanding locations.
  • Growth opportunities are sought throughout MT, UTand WA during the coming 18 months.
  • The company prefers to acquire sites and to locate near industrial parks.
  • For more information, contact
    • Kevin Kiker,
    • Western Tool Supply, Inc.,
    • PO Box 13430,
    • Salem, OR 97309;
    • Web site:
  • Fast Frame
  • Fast Frame USA, Inc. trades as Fast Frame at 300 locations nationwide and internationally.
  • The stores, offering custom framing, art work and accessories, occupy spaces of 1,500 sq.ft. in strip centers.
  • Growth opportunities are sought nationwide during the coming 18 months.
  • Typical leases run five years with options.
  • The company prefers to locate in upscale shopping centers with major anchors.
  • For more information, contact
    • Brenda Hales, Fast Frame USA, Inc., 1200 Lawrence Drive, Suite 300, Newbury Park, CA 91320; Web site:
  • Red Mango
  • Red Mango operates 18 locations throughout CA, NV, NY, OR, UTand WA.
  • The frozen yogurt shops occupy spaces of 1,000 sq.ft. to 2,000 sq.ft. in endcaps with a patio, lifestyle centers, colleges, universities and theme parks.
  • Growth opportunities are sought throughout CA and NV during the coming 18 months, with representation by Ira Spilky & Associates.
  • The company also prefers to locate in entertainment venues near multi-screen theater complexes and strip centers.
  • The company will also consider conversions of underperforming dessert shops.
  • For more information, contact
    • Ira Spilky,
    • Ira Spilky & Associates,
    • 2566 Overland Avenue, Suite 660,
    • Los Angeles, CA 90064


Wasatch Front Housing Summary

What is selling?

What isn't?

Who is down?

Who is up?

Bob Springmeyer

Bonneville Research

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    • Global Business Confidence
    • Global business confidence remains very weak and fragile, but it has taken on an ever so slightly brighter hue so far in May. Expectations regarding the six-month outlook and assessments of current conditions have improved. The inventory correction has abated; businesses aren't adding to inventories, but at least they aren't aggressively cutting them. Pricing pressures also remain very well contained given soaring energy and other commodity prices. Hiring intentions have not improved, however. The survey results in the U.S. remain uniformly negative, suggesting the economy is contracting; they remain measurably better in Asia and, to a lesser degree, in South America.
    • ABC News/Washington Post Consumer Comfort Index
    • Consumers have very little to be optimistic about as gasoline prices climb toward $4, layoffs accelerate, and house prices decline. The ABC News/Washington Post consumer comfort index came in at -49 in the week ending May 18, down from - 47 the previous week and within a single point of its record low. The details of the report were generally weak, with two of the three underlying components declining over the month. Consumer confidence is at a level consistent with a more severe economic downturn.
    • Conference Board Leading Indicators
    • The Conference Board index of leading indicators rose 0.1% in April, following a similar increase in March. This is the first time the index has risen for two straight months in more than a year and a half. The leading index is consistent with an economy that has stalled but not collapsed.
    • Risk of Recession
    • The U.S. economy is contracting but incoming data suggest that the current downturn will be short and shallow, similar to the eight-month downturn of 2001. The data suggest that the pace of deterioration in the economy is not accelerating and financial markets are gradually improving. The Moody's probability of recession eased to 51% in April, compared to March's 56%. Further, tax rebate checks are showing up in consumers' checking accounts, which will provide a much-needed boost to spending and the overall economy in the second half of this year.
    • PPI
    • Producer prices for finished goods rose by 0.2% in April, following a 1.1% increase in March. Inflation among food and energy products paused during the month. Excluding food and energy, prices for core finished producer goods rose by 0.4%. Price increases remained more rapid at earlier stages of processing. Core prices for intermediate products rose by 1.2%, while core prices for crude materials rose by a large 7.9%.
    • OFHEO Purchase-Only House Price Index
    • The OFHEO purchase-only house price index fell by 0.4% on a monthly basis between February and March, reversing the price gain in the previous month and leaving house prices down by 3.4% compared to March 2007. The fall in prices is parallel with the fall in the quarterly home price index and indicates that the trend in decreasing house prices accelerated from February to March, and that the bottom of the housing market has not yet been reached.
    • OFHEO Home Price Index
    • House prices have fallen in many regions, according to OFHEO's repeat-purchase house price index for the first quarter of 2008. Prices were down in 43 states and all Census divisions. Not surprisingly, California, Nevada, Florida and Arizona had the largest declines. The regions where house prices continued to rise tend to be smaller, more rural states. For the nation, prices were down 3.1% y/y, the largest decline in the index's history.
    • New Residential Construction (C20)
    • Housing starts increased 8.2% to 1.032 million units in April, above Moody's's expectations. Housing permits increased 4.9% during the month. Despite the increases from a month ago, starts and permits remain well below their year-ago levels. Expect the market to remain soft throughout at least the first half of this year.
    • MBA Mortgage Applications Survey
    • The MBA market composites ended down for the week ending May 16 as the mortgage market continues to look for a bottom. The market index fell by 7.8% compared with the week before as contract rates began to edge upward, as did the refinance index, which fell by 8.7% compared with last week. Finally, the purchase index fell by 6.9% compared with last week to reach its lowest point since early 2003.
    • Jobless Claims
    • Initial claims for unemployment insurance decreased by 9,000 to 365,000, erasing the prior week's increase. Initial claims have leveled off in recent weeks, no longer having the clear upward momentum shown since the fourth quarter of 2007. They do, however, remain at an elevated pace.
    • Mass Layoffs
    • The number of layoff involving at least 50 workers from a single establishment in April was 1,308, compared with 1,571 in March. They involved 133,914 workers, compared with 157,156 in March. All numbers are seasonally adjusted. Despite the drop in layoffs, the rate remains well above year-ago levels.
    • Chain Store Sales
    • Chain store sales began fiscal May on a very weak note. Sales fell 0.4% in the week ending May 17, according to the ICSC. This was the third consecutive weekly decline and fourth in the last five weeks. Despite the decline, however, year-over-year growth rose to 1.5%. Sales suffered from unseasonably cold and wet weather and soaring gasoline prices.
    • Oil and Gas Inventories
    • Crude oil inventories fell by 5.4 million barrels for the week ending May 16, according to the Energy Information Administration, compared with expectations of a 0.6 million barrel build. Gasoline inventories fell by 0.8 million barrels, below expectations of a 0.7 million barrel build. Distillate supplies rose by 0.7 million barrels, less than expected. Refinery operating capacity rose strongly to 87.9% from 86.6%. This report is bullish and should send prices higher.
    • Weekly Natural Gas Storage Report
    • Underground storage of natural gas rose by 85 billion cubic feet during the week ending May 16, in line with consensus expectations. Working gas in underground storage was 1,614 bcf as of May 16, 302 bcf lower than a year ago and 3 bcf below the five-year average for this time of year.

    Source: 2008

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