Utah Construction Update Dejan Eskic, Senior Fellow 7/13/2021
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Utah Construction Update
Dejan Eskic, Senior Fellow7/13/2021
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H Source: US Census, John Burns Real Estate
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
How Does Utah Compare?Housing Starts
0
500
1,000
1,500
2,000
2,500
0
5
10
15
20
25
30
35
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
US (T
hous
ands
)
Utah
(Tho
usan
ds)
Utah (L-axis) US (R-axis)
Source: US Census.
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Supply has Outpaced Demand Previously
0
50,000
100,000
150,000
200,000
250,000
1971-1980 1981-1990 1991-2000 2001-2010
Housing Units Households
Source: Kem C Gardner Policy Institute.
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Utah’s Housing Gap
-44,500
-70,000
-60,000
-50,000
-40,000
-30,000
-20,000
-10,000
0
10,000
20,000
30,000
40,000
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Dwelling Units Households Gap
Source: Kem C Gardner Policy Institute.
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Residential Activity
28,32531,744
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
(f)
2022
(f)
Perm
itted
Uni
ts
Source: Kem C Gardner Policy Institute.
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
What are we Building?
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Single-Family Multifamily
Source: Kem C Gardner Policy Institute.
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Where are we Building? Permitted Units 2020 & 2021*
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Single-Family Multifamily
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Headwinds
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Utah’s Months Existing Supply of Inventory
Source: Utah Association of Realtors.
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
More Utah HHs Continue to be Priced Out
Source: Kem C. Gardner Policy Institute.Note:, 3.11% 30-yr mortgage, includes PMI & Property Taxes
Priced Out
0%10%20%30%40%50%60%70%80%90%
100%
$300K $350K $400K $450K $500K $550K $600K $650K $700K
Shar
e of
Uta
h H
ouse
hold
s
Median Home Price
Pre-COVID Today
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Renters face a Tougher Path to Ownership
Priced Out
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
$300K $350K $400K $450K $500K $550K $600K $650K $700K
Shar
e of
Uta
h Re
nter
s
Median Home Price
Pre-COVID Today
Source: Kem C. Gardner Policy Institute.
Note:, 3.11% 30-yr mortgage, includes PMI & Property Taxes
Kem C. Gardner Policy Institute D A V I D E C C L E S S C H O O L O F B U S I N E S S U N I V E R S I T Y O F U T A H
Summary
Supply is improving, headwinds persist.
Housing affordability has decreased for all of us.
More Utahn’s are priced out than can afford.
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