This story is part of The Salt Lake Tribune’s ongoing commitment to identify solutions to Utah’s biggest challenges through the work of the Innovation Lab.
Senate President Stuart Adams isn’t giving up his ideal of the American dream.
“It felt to me like, previous to last session, we’ve been focusing on getting people into apartments and focusing on multifamily zoning, trying to get additional density in cities,” Adams told The Tribune. “It just felt to me like we’d lost the focus on the American dream. And that is actually homeownership.”
That’s why last year he sponsored a new first-time homebuyers program. The Legislature set aside $50 million for the program. Utah now offers those looking to buy their first homes $20,000 in down payment assistance for newly constructed homes that are $450,000 or less. A family can also use those funds to buy down the interest rate on a dwelling.
It’s now been seven months since the program launched. The Tribune took a look at the program’s numbers and spoke with Adams about what the Legislature might consider next.
How many people have taken advantage so far?
The average price of a home bought with first-time homebuyer assistance is $381,115, according to data the Utah Housing Corporation shared with The Tribune.
As of Jan. 23, 2024 nearly 500 people reserved funds to purchase a home. The average assistance amount is $19,923.
Only $11,142,602 has been spent through the program. More than $38 million remains.
Most of the homes purchased through the program so far are townhomes and attached planned unit developments.
At the end of January, 103 homes purchased were single family detached dwellings. Condos made up 101 of the dwellings bought with assistance.
Where are people buying units?
The Utah Housing Corporation listed Saratoga Springs, Spanish Fork, Magna, Eagle Mountain and Riverton as the top cities with properties that would qualify for assistance.
What are the downsides?
By restricting assistance to newly constructed homes, Adams hoped to spur more development of starter homes.
Arnab Chakraborty, dean of the College of Architecture and Planning and a professor of city and metropolitan planning, worries about ensuring that the new development doesn’t just happen further and further away from city and town centers.
When families are forced to “drive until you qualify” for homeownership, there are added infrastructure costs, congestion and quality of life issues.
“I think it’s hard to find a single-family home that’s under half a million dollars anywhere that’s new and within the proximity of Central City or major business districts,” Chakraborty said.
However, the first-time homebuyers program, Chakraborty said, is a step in the right direction when it comes to improving housing access.
“It’s important to bring these policies into alignment in a way that they are collectively working towards, yes, increasing access to housing, increasing homeownership,” but he’d also like to “address some of our other pressing needs through this by reducing congestion, reducing commute times and addressing air quality.”
Building more units per acre, allowing duplexes, triplexes and accessory dwelling units could all help spur more sustainable development while also increasing homeownership.
Lawmakers may not be as interested in tackling those solutions. Building Salt Lake reported that a bill that would have made it legal to build up to eight homes per acre in many cities and towns was “on its way to a swift death at the Utah Capitol.”
Will the Legislature put more money toward the program?
“I’m not sure there needs to be more money right now,” Adams said, “but I do think we’re seeing a change in the focus.”
A bill that made some adjustments to the first-time homebuyers program sailed through a committee hearing on Wednesday. SB 168 would allow buyers to use the funds on duplexes as long as one unit is owner-occupied and allows the Utah Housing Corporation to adjust the maximum purchase price based on geography or type of dwelling.
As interest rates lower, Adams believes demand for the first-time homebuyers program will only grow.
Plus, he’s “hoping that the cities will allow for smaller lots for the product line that allows people to get into a first home at that [lower] price point.”
Editor’s note Feb. 11, 2024, 2:09 pm • This story was updated to state that the numbers for the housing program ran through Jan. 23, 2024.
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