Utah’s about to become more renter-friendly
Jul 18, 2023, 5:00 AM | Updated: 12:07 pm
(Scott G Winterton, Deseret News)
SALT LAKE CITY— New data suggests that Utah’s housing market is about to become a lot more renter-friendly.
A recent report by market intelligence company Yardi Matrix shows that Salt Lake City’s rental prices, population growth, and owner transactions have decreased over the last several months.
“Net inbound migration has gone down a little bit for the Salt Lake area as opposed to the last few years,” explains Doug Ressler, manager of business intelligence with Yardi Matrix.
This means the population density has reduced from what it was during the pandemic.
The report states that by the end of February, there were over 18,000 rental units under construction in Salt Lake City. Another 45,000 people were in the planning and permitting stages. However, some developers may delay plans until next year or later.
Ressler says that an increase in property supply with a decrease in population growth means renters are likely to have more bargaining power.
“We anticipate that because of the new supply coming on board, it will be a much more renter-friendly type of environment,” he says.
Part of this renter-friendly environment will include certain concessions.
As developers look for people to fill their new supply of apartments, they will be more willing to provide better rates, causing the rental rate to continue to decrease.
“You will see concessions. Again, very renter-friendly type of things where you’ll be able to negotiate more concessions towards Q3 and Q4 this year,” Ressler states.
Even though data shows Salt Lake City’s competitive edge may be softening, it’s still among the top competitive cities in the nation.
Competitive renter-friendly cities
A study by RentCafe, sister company to Yardi Matrix, analyzed 137 rental markets in the nation. Salt Lake City ranked 34th most competitive.
They created a Rental Competitivity Index (RCI) for each city using five different factors:
- The number of days apartments were vacant
- The percentage of apartments that were occupied
- How many renters applied for the same apartment
- The percentage of renters who renewed their leases
- The share of new apartments completed
This rental season, they calculated the nation to be “moderately competitive.”
Although softening somewhat, Utah’s capitol city remains to be more competitive than its neighboring markets.
“Salt Lake City is one of the most competitive markets in the west,” says Ressler.
With an RCI score of 64, Salt Lake only falls behind Montana and Alberquerque. Ranking higher than Boise, Denver, Las Vegas, and Phoenix.