BUSINESS

Priced Out: How did the Utah housing market get so expensive?

Apr 12, 2021, 5:00 AM | Updated: Apr 13, 2021, 9:21 am
Utah housing market priced out...
(PHOTO: Canva)
(PHOTO: Canva)

Editorial note: This is part one of a series on affordable housing, called “Priced Out.” You can see the other parts of our coverage here

SALT LAKE CITY — Prices in the Utah housing market have skyrocketed even during the pandemic – great for homeowners and landlords, but anyone trying to buy a home or rent an apartment is having a tough time. 

In the first part of  KSL Newsradio’s series Priced Out,  we look at what’s pushing Utah’s red-hot housing market.

Has the Utah housing market been overtaken by Californians? 

Can we blame people moving here from California with buckets of cash for pushing up rents and home prices? Utah Foundation researched that question, and Senior Research Analyst Christopher Collard said it’s more the result of people from Utah who didn’t leave.

“So people stopped leaving Salt Lake City and the Salt Lake City metro area at the same rates they had over previous years, y’know, back to 2015,” Collard told KSL-TV, and that put some additional pressure on the housing markets.”

Why so high, then? Turns out Utah’s strong economy over many years is responsible for the long-term growth in housing prices. James Wood is a senior fellow at the University of Utah’s Gardner Institute. He says it’s now reaching a fever pitch.

“The last 8 months have been the most heated period that I’ve seen in almost fifty years of following the market,” Wood told KSL Newsradio.

Pricing low-wage workers out of the housing market

The net result is that low-wage workers are priced out of the market. Typical rent for a two-bedroom apartment in Salt Lake City today is about 12-hundred dollars. If affordable is defined as paying no more than one-third of your income for housing, Tara Rollins with the Utah Housing Coalition says low-wage workers – those making 30-percent of the area median income (AMI) – are hit the hardest.

“We have 70% of people pay more than 50% of their income to housing,” Rollins said. “When you get up to the 50% of AMI, we have 27% paying more than 50% of their income.”

Even with a moratorium on evictions during the pandemic, it’s been tough for workers in that pay range to find and stay in an apartment.

Those earning a higher income are struggling too

Finding a place to live isn’t simple even for professionals with higher incomes. Ryan Rhodes moved to Utah from Illinois a couple of years ago.

“I eventually signed for an apartment in Marmalade, so just west of Capitol Hill, so that was really nice.”

This year, Ryan and his husband have been working to become homeowners, and got into a situation with several potential buyers submitting competing bids for the same property. We’ll have more on that in upcoming segments of our series Priced Out: Finding an Affordable Home in Utah. 

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Priced Out: How did the Utah housing market get so expensive?