By: Dejan Eskic
Note: The opinions expressed are those of the author alone and do not reflect an institutional position of the Gardner Institute. We hope the opinions shared contribute to the marketplace of ideas and help people as they formulate their own INFORMED DECISIONS™.
For the better part of the last decade, housing demand in Utah has far outpaced its supply. The term “housing shortage” or “housing gap” is ingrained in our everyday lexicon. Utah’s estimated housing gap in 2020 is 44,500.[i] This gap, combined with strong economic growth and historically low interest rates, has pushed prices to new highs, bringing new affordability challenges to all incomes.[ii] The economic challenges resulting from the pandemic have created a very competitive and unhealthy housing market, leading to a drop in existing for-sale supply and further exacerbating housing challenges in our state and the nation.[iii]
The housing shortage is further evident in the below 5% apartment vacancy and single-digit days-on-market of existing homes for sale.[iv] Additionally, the months of supply for both new and existing homes for sale sit at less than one month. In other words, if no new supply came on the market today, we’d sell out of everything currently for sale in less than a month.
U.S. Census Bureau housing statistics show Utah had 109,688 vacant units in 2019, significantly higher than the housing gap. The number of vacant housing units for Utah has ranged from 101,000 to 111,000 over the last decade (see Figure 1). From 2010 to 2019, vacant units grew at an annual rate of 0.8% in the state. While the number of vacant units has increased over the last decade, the vacancy rate has declined. The Census Bureau vacancy rate in the state was the highest in 2011 at 11.0% and has trend