The real estate market in Utah has been experiencing dwindling inventory that’s been increasing prices, alongside with growth in the multifamily sector. But Utah is projected to double it’s population by 2065 and that growth will have a large impact on reshaping housing and communities.
Although the labor shortage is a current challenge, an emerging issue will be the lack of vacant land according to Ari Bruening, the chief operating officer at Envision Utah. “We can’t just keep growing outward because we hit mountains and lakes and federal lands,” he told Utah Business. “The lack of land is going to be an issue for a long time, and I think that raises the questions: are we going to find ways to accommodate limited land or not? Will people pay a lot for housing close to their jobs or pay less and live farther away?”
With land becoming less available, builders are choosing smaller lots to keep up with home affordability. The market shifted, land became more expensive, and builders started to focus on expanding their business model to include multifamily units, condos, and townhomes at a price people can afford.
Overall, why does a land shortage matter? Bruening says it matters because things like air quality will suffer by forcing people to drive longer distances to work, and workers could feel excluded because they won’t be able to afford to live in the communities they work in. He goes on to say “One reason we’ve done well economically compared to places like California is because we’ve been affordable for setting up business,” he adds. We don’t want to lose that competitive advantage. On the other hand, it’s a good challenge to have, because we’re a growing place where people want to be and our economy is doing well. We just have to recognize the constraints of land supply.”
The four Wasatch Front counties and Washington County will see the largest share of population growth over the next 40 years. As Utah’s population continues to grow there will always be people looking for affordability in exchange for a longer commute. But more people will also start looking into apartments, townhomes, and small lots.