What will happen to rents in Utah?
The Salt Lake Tribune, in partnership with the Kem C. Gardner Policy Institute, will host a forum examining the Utah rental market.
This story is part of The Salt Lake Tribune’s ongoing commitment to finding solutions to Utah’s biggest challenges through the work of the Innovation Lab.
Walking through downtown Salt Lake City, it’s hard to believe that Utah is in the midst of a housing crisis.
New luxury apartment towers are dominating the landscape and they all appear to be promoting open plan rentals. If the theory of supply and demand is true, doesn’t that mean renters in SLC should feel some relief soon?
The answer is: somehow.
If you want to learn more and better understand the strange rental market landscape we find ourselves in right now, The Salt Lake Tribune, in partnership with the Kem C. Gardner Policy Institute, is hosting a community forum on the subject at the Thomas S. Monson Center in Salt Lake City. Personal attendance registration is no longer possible. But a livestream feature is available here, from 8am to 9:30am on Thursday April 6th.
Construction of rental housing in downtown Salt Lake City has boomed, and thousands of new apartments will be completed and available this year, bringing some relief to renters, said Dejan Eskic, a senior research fellow at the Gardner Institute.
“We had a lot of momentum building,” Eskic explained. But as the Federal Reserve continued to raise interest rates, developers “took a break.”
That means the relief in some parts of Salt Lake City may only be temporary as the population continues to grow. “I still expect our housing shortage to get worse,” Eskic said, “because we’re going to have 40% fewer units this year than we built in 2021.”
A policy brief published by the Gardner Institute in February found that over the past five years, “rent prices have increased twice as fast as renters’ incomes.”
Contribute to this pressure? Families and individuals looking to exit the rental market and buy a home may not be able to at this time.
Luann Lakis, a broker at Keller Williams Utah in Salt Lake City, has worked in the industry for 33 years and says she’s “never seen a market like this.”
“There are fewer buyers for homes above a certain price range,” Lakis said, but home prices remain stubbornly high and finding a single-family home for under $500,000 is a challenge.
“It’s hard to buy a house, and it wasn’t like that before,” Lakis said. “And I don’t see a lot of relaxation because people are moving to Utah along the Wasatch Front because there are good job opportunities here.”
Though Utah has many housing affordability issues, some solutions are in the works.
In the past legislature, Utah increased its contribution to a state low-income housing tax credit program that encourages developers to build more affordable housing. Lawmakers have also allocated funds to help first-time homebuyers with down payments. Salt Lake City is providing developers with $8 million in soft loans to build eight distinct projects that will include rent-subsidized housing.
Also, Eskic says, the more expensive luxury rentals coming online could tempt higher-income earners to relocate and open spots in buildings with fewer amenities but more manageable rents.
“There’s a liberating effect,” Eskic. And hopefully, “we’ll all move up a little bit.”
https://www.sltrib.com/news/2023/04/05/whats-happening-with-utah-rents/ What will happen to rents in Utah?