Salt Lake City SFR Market Update

Rents for single-family homes expanded 0.3% during Q2 2024 and 3.2% since year-end 2023.

While apartment rents continue to decline modestly due to a record number of deliveries, rents for single-family homes grew 3.2% in 2024. As of Q2 2024, the median rent for a single-family home in Salt Lake City was $2,995, compared to $2,900 as of the end of 2023. Rent growth slowed to 0.3% quarter-over-quarter; we expect rent growth during the year's second half to be minimal.

Owing to a lack of supply across the high-quality segment, the median rent for Class A homes is $3,781 per month, or 26% higher than the median SFR home. By contrast, rents for Class B homes are 4% below the median, while Class C properties are priced at a 16% discount.

Vacancy rates continued to hover around 5% for SFRs and have historically been stable, particularly given increases in the supply of single-family homes for sale and/or rent in Salt Lake City are virtually non-existent. With no land available for single-family home development within Salt Lake City proper, most new developments are within 25-30+ minutes of the city. This creates a dynamic where the growth in the supply of housing inventory with 3+ bedrooms in Salt Lake City itself is fairly small, which places upward pressure on rents for single-family homes. Furthermore, across the broader Salt Lake County, housing starts declined by 20% in 2022 and 5% in 2023, creating even more strain on supply levels.

Although we continue to observe growing pockets of opportunities in the apartment sector, we expect the SFR market in Salt Lake City to outperform multifamily in 2024 due to more favorable supply-demand fundamentals.