Holding for Now, but “The Crossroads of the West” Could be Heading For Trouble
by Carole VanSickle Ellis
At the beginning of this year, Zillow analysts predicted that Salt Lake City, Utah, would be one of the “hottest markets of 2025,” boosting the city nicknamed “The Crossroads of the West” eight spots from #18 to #10 on the annual list. This ranking placed Utah’s capital city solidly first in the western region of the United States and, unusually, placed a market known for consistently unaffordable housing in the “hot market” class.
“Salt Lake’s low inventory has famously driven up prices for years, and yet, people still want to buy homes here,” Zillow senior economist Orphe Divounguy told Axios at the time. He added, “Salt Lake’s ranking rose from #18 to #10 because it is still more affordable than some other western cities and has great amenities that keep driving up demand.”
Axios contributors Erin Alberty and Brianna Crane warned in their January coverage of the rankings, “The high ranking suggests Salt Lake’s housing crisis will probably persist, pricing lots of residents out of homeownership for yet another year.” The two also noted high volumes of new construction are needed in SLC, but observed new construction of single-family homes was about 32% below pre-pandemic levels during the first half of 2024.
With mixed metrics like these, it is no wonder that by June of this year, Salt Lake City’s housing market outlook faced a ranking far worse than its January showing. In a study released by LendingTree in June 2025, SLC was ranked fifth-worst for its housing outlook at the time of the study’s release.
According to Aaron Drussell, vice president of the Utah Association of Realtors, the SLC market is driven primarily by first-time home buyers, but, he added, “the housing is not quite there for that group.” Drussell continued, “The average [SLC] homeowner right now…only makes about 74% of the money needed to buy a home in their current area.” He also pointed out median home prices in SLC have risen more than $85,000 in the past decade, up to $536,000 in 2025.
The current market relies heavily on cash buyers, according to a report from the Kem C. Gardner Policy Institute at the University of Utah, because cash buyers are “not deterred by high mortgage rates.” In 2024, one in five home sales in Utah were cash purchases. In the same report, analysts said they expect “slower growth and economic uncertainty to lead to less demand for housing” during the latter half of 2025.
The SLC Rental Market Could be an Uncertain Bet
Even rental rates are stalling in the Salt Lake City area, reported the institute just one month after the LendingTree report was released. These rates did not rise significantly during the entirety of 2024, and, at the same time, new construction rates declined substantially. By some measures, rental rates have actually fallen slightly.
Although rents have not moved much in SLC over the past few years, many analysts say rental assets could be investors’ strongest bet if they wish to maintain a portfolio in Salt Lake City. According to Lima One Capital analysts, SLC’s largest industries — education, financial services, information technology, and outdoor industries — pair powerfully with the region’s highest-paying industries: mining, quarrying, oil and gas extraction, agriculture, forest, fishing, hunting, and utilities.
The city’s multifamily real estate market also has burgeoned since the 2020 COVID-19 pandemic, although lately analysts are expressing concerns that new construction in this sector is slowing as in other sectors of the market. Strong industry elements in the economy could continue to bring in new residents even if those residents are priced out of homeownership.
Easy Street Capital analysts concurred with the Lima One Capital assertion that local industries are likely to continue to grow the population, noting Salt Lake City is also a popular tourist destination with a wide offering of recreational opportunities, professional sports teams, and beautiful outdoor spectacles. Interestingly, Axios recently reported the bulk of SLC’s downtown economy is currently powered by the local “social scene.” In that article, Dee Brewer, executive director of the Downtown Alliance, observed, “Previously, the [downtown] area was seen as a vertical office park, but now much of its activity occurs between 6pm and midnight.”
But What’s Going on with the Great Salt Lake?
Naturally, one of the area’s biggest draws for tourists is SLC’s namesake, Utah’s Great Salt Lake. However, in 2022, Utah’s Great Salt Lake hit historically low levels, and warning bells began to sound. Lawmakers leapt into action, creating a new position, the Great Salt Lake commissioner, and developing a “strategic plan” they hoped would prevent the lake from drying up. If they are successful, their efforts would mark the first successful reversal of a saline lake’s decline in the world.
There are two established strategies for preserving and potentially restoring saline lakes: artificially reducing the surface area of the lake or litigating water delivery to the lake in order to increase volume. Unfortunately, both are difficult to implement and have not, as yet, been successful in actually reversing salt lake decline.
“Significant conservation can be achieved and saline lakes restored when there is sufficient social and political will,” observed the authors of an article on the topic published in Nature Geoscience in 2017. Robert Adler, a professor of environmental law at the University of Utah S.J. Quinney College of Law, noted the Great Salt Lake “contributes tremendous biodiversity” to the region, and a legal study published by the Environmental Law Institute warned continued decline of the lake could “reach well past industries directly dependent on the lake’s bounty, such as brine shrimp harvesters, mineral extractors, and birding and boating enthusiasts, and affect the bottom lines of publicly traded companies and the region’s overall economy.”
They predicted in a May 2025 article published in the Salt Lake Tribune that “the trajectory of a full-on lake collapse could wreak billions in damage over time to the outlook as well for property values along the Wasatch Front, tourism, the ski industry, health insurers, the ability of Utah’s technology sector to recruit vital talent, and far beyond.”
Since 2022, lake levels have risen roughly five feet and must rise roughly five more to “attain a minimum healthy elevation,” reported the New York Times earlier this year.
“We all have to understand it is all of us working together on this, and it’s our problem,” said Great Salt Lake commissioner Brian Steed in late July 2025. He believes the lake can be saved through concerted water-conservation efforts and water management. Investors should carefully monitor all of SLC’s current and often conflicting metrics and trends before making investment decisions in this area of the country.
Sidebar 1
By the Numbers
$536,000 // median sales price in Salt Lake City* (Realtor.com)
46 // median number of days on market in Salt Lake City* (Realtor.com)
5% // percentage decrease in the share of homes sold within two weeks in the metro area between April 2023 and April 2024 vs. 3% nationally (Axios)
17% // percentage housing inventory in SCL increased between April 2023 and April 2024 (Axios)
99.9% // sales-to-list-price ratio in SLC* (Realtor.com)
9 // the Utah housing market is the 9th-most-expensive in the United States* (Kem C. Gardner Policy Institute)
1 // Salt Lake City was Utah’s fastest growing city in 2024 (U.S. Census Bureau)
39% // increase in average number of monthly short-term rental listings in Utah between 2021 and 2023 (Kem C. Gardner Institute)
$1.32 Billion // estimated economic value of the Great Salt Lake as of 2017 (Nature Geoscience)
*As of June 2025
Sidebar 2
Salt Lake City’s Top 10 Largest Industries
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