St. George • In addressing members of the Southern Utah Home Builders Association on Tuesday, Utah Gov. Spencer Cox asked them to imagine a dystopian future — not one plagued by another pandemic, economic collapse or even a zombie apocalypse.
No, the Orwellian world Cox conjured for the packed crowd of builders at the Hilton Garden Inn in St. George is one where housing costs remain so high that an entire generation or two never get an opportunity to realize the American dream of owning a home.
Without action, Cox warned, that nightmare could become the reality for Utah and the nation.
“This is an existential crisis,” the governor warned. “It’s a crisis on par with anything that we face economically as a country. It’s more of a slow-rolling crisis, so we may not see it the same way we did, like the Great Recession.”
Former Utah legislator Steve Waldrip, the governor’s senior adviser for housing strategy and innovation, seconded his boss’s nightmarish assessment, telling homebuilders that as he meets with cities and counties about the problem, he plays the role of the “proverbial Jewish grandmother” and shames them for not doing more.
‘A moral issue’
In a recent presentation to some county commissioners, whom he did not name, Waldrip said his message to them was that the lack of affordable housing in Utah was not an economic development or policy issue. “This is a moral issue. This goes to the heart of the morality of who we are and what we care about,” he told them.
The simple fact, Cox and Waldrip attested, is that homeownership is increasingly out of reach for many Utahns. As Robert Spendlove, R-Sandy, informed lawmakers last legislative session, the median price of a home in Utah is $501,652 compared to the national average of $342,941.
While no single bullet will slay or solve the problem, Cox said increasing the supply of homes will do more than anything to bring home prices down. According to a 2023 legislative audit, Utah needs to build 28,000 homes per year to keep pace with growth. Utah’s current housing shortage is estimated to exceed 37,000 units.
Cox particularly lamented the lack of starter homes, noting builders across the country quit building them after the Great Recession of 2008 and now focus on constructing large apartment complexes and large homes, the latter for the people who can afford them. That’s why the governor set a goal in December to build 35,000 starter homes over the next five years.
As big a problem as the housing supply poses, the governor was ebullient about the Utah Legislature’s recent passage of HB 572, which enables the state to use its budget surplus to reduce the cost of loans that builders need to build starter homes.
Essentially, the legislation created a $300 million fund to supply builders with lower-interest loans through their bank or credit unions. In exchange, builders must agree that 60% of the homes they build with the funds must be starter homes.
They also must inform prospective buyers about down payment assistance available through the First-Time Homebuyer Program. In addition, the legislation allows cities to place a deed restriction on the homes that require them to be owner-occupied for five years so large outside investment companies can’t buy them and turn them into rentals. It is estimated the legislation could result in the construction of 10,000 homes over the next several years.
That said, Waldrip said the program requires buy-in from builders, cities and counties to work. That’s tough, he acknowledged, to ask developers to build a starter home and make $25,000 instead of sticking with the status quo by building a more palatial abode and pocketing $200,000.
Aside from securing cheaper loans, Waldrip said builders can make up most of that difference by — with cities’ permission — building more starter homes and in higher densities. They can make up even more of the shortfall by making the remaining 40% of the homes they build much larger.
State could step in without changes
Cox and Waldrip also decried the NIMBY (not in my backyard) narrative prevalent in many cities throughout Utah and called on elected municipal officials to approve home builders’ applications quicker and to relax overly restrictive zoning and other requirements that exacerbate construction costs and housing prices
“How many cities are requiring garages because we can’t stand the sight of cars,” Waldrip said. If “[parked cars] are twenty feet away, they are totally fine. But once [cars] hit that driveway, that is like looking at Satan incarnate.”
Neither Cox nor Waldrip singled out any particular city at the event. If they had, they wouldn’t need to look far. In nearby Ivins, city officials conducted a survey in December 2022 that found more than 70% of residents were opposed to higher-density housing.
Cox called on Utahns and their elected leaders to overcome NIMBY attitudes and get serious about rising to the challenge of solving the state’s housing crisis. While the governor stressed the carrot aspects of the new legislation, he raised the specter of employing the stick if cities and residents don’t do their part voluntarily.
If Utahns and their elected leaders do not step up to the challenge, he warned, the state would have no choice but to step in to “change zoning laws” and “take a more active approach” to avert an even worse crisis.
“I hope we never have to go there,” Cox said. “But we are very serious about this.”
