Heber leaders say they want to do what they can to address unattainable home prices in the city. In the most recent legislative session, lawmakers sought to give them and other Utah municipalities another tool to incentivize affordable development.
H.B. 572, which passed in March, allocates $300 million to small, regional builders for housing developments. Under the terms of the bill, at least 60% of the new homes must be deed-restricted for a minimum of five years.
Steve Waldrip, Gov. Spencer Cox’s senior advisor for housing strategy and innovation, spoke with councilmembers Tuesday, June 18, about the state’s housing crisis and how the new legislation is meant to help.
He said the housing crunch could have dire consequences for Utahns.
“The greatest threat to our future as a state, as a nation, is the loss of opportunity,” he said.
Waldrip said home prices have soared far beyond what’s reasonable for most Utah residents. Median home prices used to be about triple the median household income. Now, home costs are about 6.5 times higher than salaries.
“We will wait a long time before wages catch up to home prices for it to go back to [a] three to one [ratio],” he said.
On top of that, Waldrip said homeowners aren’t moving due to rising interest rates, so there’s little turnover in the market.
He said deed-restricted housing is one tool to improve the state’s outlook, and the new law puts some control in city leaders’ hands. Waldrip said the local emphasis is a key aspect of the law, because communities know their own needs.
“If you can guarantee… that these are going to be homes that your teachers and your firefighters and your workers can live in and be a part of your community, that’s what you want,” he said.
Councilmember Scott Phillips said he likes the law’s requirement for owner occupancy to prevent affordable housing from turning into short-term rentals.
“You know, I’m trying to help people out,” he said. “I’m not trying to enrich them and now when they sell their home, they’re coming back on the market as VRBOs and Airbnbs.”
It’s up to the city to manage the terms of the deed restrictions: it can make the period longer than five years or the percentage of affordable homes higher than 60%.
The new law also permits cities to create a 10-acre “Home Ownership Promotion Zone.” That would allow cities to get a tax increment for infrastructure improvements if homes in the zone meet certain density requirements and sell at 80% of median income.
Waldrip said the goal of the legislation is to foster more economic diversity in Utah cities.
“This is growth with intent to enrich and enhance communities,” he said.
The discussion at Tuesday's meeting was for the council to learn more about its options with the new law. Councilmembers will continue to work with Waldrip to brainstorm how to implement the legislation in Heber developments.
