Information Effect; The Housing market

Everyone needs somewhere to live, someplace they can call home. The American dream
is to own that home. Buying your first home is a major stepping stone in life. Unfortunately, here
in Utah, that dream is becoming nearly impossible. First time home buyers can’t find that home
they can afford so they can’t get into the market. This market has never been an easy one to get
into, but Utah's market is at an all-time high, making it almost impossible for first time home
buyers. According to Mark Oliver from KSL News “The average cost for a home in the U.S. has
almost doubled since 1990. Our salaries, in the meantime, have remained relatively stagnant,
only increasing in proportion to inflation”. As this imbalance continues to get larger, it makes it
harder for more people to afford houses in Utah 50.7% of house owners would not be able to
afford homes now. Many people aren’t aware of what is causing the market to rise as it is. There
are a few things contributing to the market rising, the growth in population and limited space are
the two largest. There are many things that Utah is trying to do to help with this issue.

Utah’s economy is great and many businesses are moving here. With businesses coming
it brings lots of people with it. “In Utah, the impact of a thriving economy and growing
population is that prices increased 14% in just one year,” (Egan). This rapid growth in population
is changing Utah’s housing landscape.“Utah is projected to double its population by 2065. That
unprecedented growth is expected to have an even larger impact on housing in communities—
and those trends of the future are already starting to show up today” (Madison). Houses are in
large demand and builders just can’t keep up with them. In the valley, there is not enough space
to hold the many people wanting to move in. “We can’t just keep growing outward because we
hit mountains and lakes and federal land,” said Ari Bruening chief operating officer at Envision
Utah. Most cities can continue to grow outward but here in the Salt Lake valley, we have a
limited amount of space. The lack of space makes the land more expensive and lots are getting
smaller in hopes to keep them affordable. They are also building more hi-density housings like
condos and multifamily units. “We’re seeing a real boom in condos. That’s a reflection of
affordability. People want to get into ownership, but they can’t afford single-family, particularly
if they’re a young household” (Madison). If buyers want to buy homes they have to look further
out to find homes they can afford.

What is Utah legislative doing to help with this problem in the housing market? The most
recent thing that has been done to ease the stress of the market is passing a bill SB39. This
provides $33.5 million to help build/ preserve low-income housing throughout the state.
“According to SB39′s sponsor, Sen. Jake Anderegg, the state’s leading housing analysts estimate
that Utah lacks 45,000 to 55,000 single-family homes and rental dwellings within the financial
reach of blue-collar workers and residents earning below-average wages” (Semerad). SB34 is
another bill that is trying to be passed, “it would create a new incentive for cities to zone for
affordable housing, amid a time when experts say Utah is facing a more than 45,000-unit
affordable housing gap” (McKellar). The Legislature admits that neither of these measures is
enough and more needs to be done. Utah's legislature vows to continue to address the housing
market issue in future sessions.

For the generations beginning adulthood and the generations following behind them, the
American dream becomes even farther out of reach. "Millennials will have to sacrifice twice as
much of their paychecks to make mortgage payments as their parents did in 1990... Prices cannot
rise above a level where buyers cannot afford a home. If real wages do not continue to raise the
price of real estate will, at some point, become unsustainable.” (Oliver) Like all markets, it will
rise and fall but will it collapse but will it fall to a point of affordability? Until that collapse
happens we will not know what will happen and how many more people will be affected. When
the collapse happens homes may become more affordable but the other consequences may not
make it worth it.

Work Cited
Egan, Ladd. “Report: Utah Ranks 2nd In Nation For Rising Home Prices.” KSLTV.com, KSL
News , 11 May 2019,
 ksltv.com/413783/report-utah-ranks-2nd-in-nation-for-rising-home-
prices/.

Madison, Rachel. “BUILD OUT: Population Growth Will Reshape Utah’s Housing Landscape.”
Utah Business, vol. 32, no. 2, Feb. 2018, p. 50. EBSCOhost,
search.ebscohost.com/login.aspx?
direct=true&db=bwh&AN=128084695&site=eds-live.

McKellar, Katie. “Utah Lawmaker Pushing Bill Requiring Cities to Zone Affordable Housing If
They Want State Dollars.” Deseret News, Deseret News, 2 Feb. 2019,
www.deseret.com/2019/2/1/20664798/utah-lawmaker-pushing-bill-
requiring-cities-to- zone-affordable-housing-if-they-want-state-dollars.

Oliver, Mark. “Could You Afford the House You Live in If You Had to Buy It Today? For More
than Half of Salt Lake City, a Study Says, the Answer Is ‘No’.” KSLNewsRadio,
KSL News Radio, 23 Jan. 2019,
kslnewsradio.com/1897102/housing-prices-unaffordable-utah/.

Semerad, Tony. “New Utah Housing Bill Would Put $35M into Rental Assistance and More
Low-Income Apartments.” The Salt Lake Tribune, The Salt Lake Tribune, 9 Feb.
2020, www.sltrib.com/news/2020/02/09/new-utah-housing-bill/.