Could Accessory Dwelling Units Address The Affordable Housing Shortage?

Feb 8, 2021

Credit KPCW News

A bill tackling affordable housing in Utah is making its way through the legislature. However, local representatives across the state have raised a number of concerns with the piece of legislation.

 

 

The bill, sponsored by Republican Rep. Raymond Ward, would allow single-family homes to build on accessory dwelling units - allowing people to rent out their basements. 

Currently cities and municipalities can restrict construction of these units. Ward said by removing these regulations the state could solve key issues with affordable housing. 

“When we restrict supply and demand goes up, the cost goes up,” Ward said. “As we scramble and twist and look at all different programs to try and solve our affordable housing problems... Instead of just only thinking about how to build one more unit, it's also really important to think, how to use the units that we have already invested in, in a way that's efficient.”

By allowing homeowners the right to build on, he said it could save the government money. 

“Building a new unit of affordable housing, if you just pay for it straight out cost the state about $250,000 a quarter of a million bucks,” he said. “Whereas to a homeowner just wanting to get a kitchen to their basement and rent it out that might be $25,000 a 10th of that cost, and they're not going to ask the state to pay for it, they're gonna pay for it this up for themselves.”

The bill requires that the unit be entirely inside of the existing footprint of the house, and the homeowners still have to live inside the building. 

During a committee meeting last week, a number of council members from different municipalities brought up concerns about an increase in population which could lead to zoning issues with water pipes, parking and public safety. 

Summit County Economic Development and Housing Director Jeff Jones serves on the Governor’s Commission on Affordable Housing. He said there’s no doubt that there’s a need for affordable housing.

“Estimates show that the state is between 45-50,000 units short to where we need to be,” Jones said. “So we obviously need to increase production as well. But that production increase needs to be targeted towards the sectors that need it the most.” 

Jones said last month when the bill was presented to the commission, he voted against it. One of the issues he said is that the bill didn’t target area median income also known as AMI. 

“And we know we have cities out there, like Vancouver in BC, where 35% of the city has accessory dwelling units, or single family homes have accessory dwelling units, but affordability is still an issue there,” he said. “Because those accessory dwelling units were not deed restricted to a specific AMI target.”

The average earning per job in Summit County for a single family home is about $58,000, which is almost $13,000 less than the statewide average. And almost 80% of the earnings per job falls between 40-60% of the AMI. 

Jones said the bill should have deed restrictions to make sure the accessory dwelling units are 80% of the AMI or less. 

“So that really ought to be our target,” he said. “And it would seem to be a shame that if we were developing a bunch of housing stock that was in excess of that. We still have leads in other AMI as well.”

The other issue, he said, is that there is nothing stopping short term rentals. 

“If you're a property owner, and you can get a greater return on investment, from a short term rental, as opposed to long term rental, most people are going to move in the direction to where they can recover the greatest return on investment,” he said.

He said if those two issues didn’t exist...he probably would’ve voted favorably. 

The bill was put on hold by the House Business and Labor Committee, but discussion will resume Monday, Feb. 8. 

 

The Legislative Report on KPCW is made possible, in part, by the law firm of Hoggan Lee Hutchinson at HLHParkCity.com.