North Ogden • When Kim and Zach Bartlome began their homebuying journey three years ago, they had already started saving for a down payment.
They knew affording a house wouldn’t be easy — both work as educators. Zach currently teaches Spanish for Weber School District and Kim works with teenagers through the Utah State University Extension.
Still, they were tired of renting. They’d spent years in two-bedroom townhomes and their family was growing. Kim needed an office to work from home. They wanted a yard where their young boys could play. They were also careful spenders. “Kim and I have been really good with money for a long, long time,” Zach said, “so we had no debt going in.”
But as they scrimped and built their nest egg, home prices kept soaring. “We couldn’t save as fast as inflation was going up on house costs,” Zach said. And the couple felt especially discouraged after speaking to a loan officer. “It just felt like we couldn’t pay for anything,” Kim said.
Then earlier this year, the Bartlomes learned about a new shared equity program, praised by Gov. Spencer Cox, that helps educators and essential workers like them.
Qualifying homebuyers receive down payment assistance from California-based brokerage firm Landed. In return, the property owners share a portion of the property’s gain or loss with the company when they sell or refinance.
About six months after Landed launched its shared equity program in Weber County, the Bartlomes closed on a five-bedroom home in North Ogden, complete with a fenced backyard.
“We have a field just behind us,” Kim said, “and [the kids] love that there are cows and horses back there.”
Landed put down 15% on the house, which cost $398,000, while the Bartlomes put down 5%. The ability to make a 20% total down payment spared the family from mortgage insurance, freeing up their budget to paint the walls, add new lights and swap out the swamp cooler for air conditioning.
“We’re able to save quite a bit because of that, not having to pay mortgage insurance,” Kim said. “It’s a very big blessing.”
Landed has since expanded its shared equity program beyond Weber County to University of Utah employees, and it plans to eventually reach more essential workers in the state, including teachers, health care providers, first responders and other public service employees.
“In high-cost housing markets across the country, we find that the people who help cities function have a hard time buying homes in the communities they serve,” said Ian Magruder, head of partnerships at Landed. “A lot of times they need housing support. Specifically, they need down payment support.”
The idea is to help buyers like the Bartlomes reach a 20% down payment. Landed will provide as much as 15%, up to $120,000. For every 1% Landed contributes to the down payment, the company takes 2.5% of the equity. If the house ends up losing value, Landed also takes a share of the hit.
Landed has helped essential workers buy homes in pricey metro areas like Washington, D.C., Seattle, San Francisco and Los Angeles by partnering with local governments, school districts and other public institutions.
“We’re really committed to expanding to other cities that are starting to experience a housing challenge,” Magruder said. “Housing seems to be an increasing priority for employers across the greater Salt Lake region.”
Founded in 2015, Landed raised $31 million in Series B funding this month. The company also received a housing affordability prize in 2019 from Ivory Innovations, an academic institution that is part of the University of Utah’s David Eccles School of Business.
“Our whole goal is to find solutions to the housing affordability crisis that are scalable, doing something innovative, pushing different boundaries,” said Abby Ivory, managing director of Ivory Innovations, who worked to bring Landed to Utah.
Homeownership has traditionally served as a tool for the American middle class to build wealth, Ivory noted, but the middle class is shrinking. The amount of U.S. adults living in middle-income households declined from 61% in 1971 to 51% by 2019, according to Pew Research Center.
“What we see is people get consistently priced out of the market, year after year,” Ivory said. “We’re helping them find a way.”
Since launching in Utah, Landed has seen 71 Weber County residents and about 100 University of Utah employees participate in informational sessions, the company reports. Two have closed on homes, and about a dozen more are in the process of buying.
As one of the families who found a home of their own using Landed, the Bartlomes acknowledged plenty of barriers remain for middle-income buyers. Utah’s stock of houses for sale remains low. House hunters put offers on homes, only to see the property snatched up by others paying tens of thousands above asking, with cash. Meanwhile, prices continue to climb.
“That amount we saved that ended up covering 5% [as a down payment] would have covered 20% two years ago,” Kim said. “Then the market got crazy.”
Still, the Bartlomes offered some encouragement for those trying to navigate the tedious homebuying process.
“Save while you can and keep looking for a house that fits your family best,” Kim said. “It is possible, even on an educator’s salary.”