This isn't a surprise to anyone looking for a new home, but maybe you should sit down anyway.
Utah is the nation's ninth most expensive housing market now, with an average home price sitting around $506,000 — but the price of sought-after single-family homes is nearly $550,000.
That means the dream of ownership is still out of reach for 87% of the state's renters.
While solutions have come in fits and starts, and lawmakers continue to push, the current state of the housing market in Utah is "dull," in the words of Dejan Eskic, a senior research fellow at the Kem C. Gardner Policy Institute.
Housing prices ticked up 3.6% in the last year, according to the institute's new report. And while the market is cooler than it was in 2020 to 2022, when housing prices skyrocketed 44% in just two years, it's baffling to Eskic how tough it is to enter homeownership.
"There's less buyers, there's more supply," he said. "Which is kind of weird, because usually, in a normal environment, when your demand is frozen out, and your supply goes up, you get price drops."
But prices aren't dropping. Part of that, Eskic said, is because the housing market doesn't look anything like it did during the 2008 financial crisis. People snagging homes for sale have good credit. There aren't mass foreclosures or job losses. People aren't trying to sell because of financial pressure. Instead, they're comfortable waiting for the right buyer who will pay a higher price.
Even though sales of existing housing stock increased 7% over the last year, there is significantly less new construction. So the homes that are for sale, Eskic said, likely have someone already living there. New residential units fell to 21,966, the lowest level since 2016, according to the report.
There are a few culprits. Interest rates are high, which discourages buyers and builders. Additionally, President Donald Trump's tariffs have stifled construction.
"It's hard to estimate what your costs are going to be right now because of the tariff policies," he said.
The lack of new buildings concerns Steve Waldrip, senior advisor for housing and innovation to Gov. Spencer Cox. He believes the market is in a holding pattern. But the problem could worsen, Waldrip said, especially since Utah hasn't met the current demand for housing supply. In order to do that, he said the state would need to add about 28,000 housing units of all kinds each year. Utah is short 30 to 40,000 units.
"We're falling even further behind," he said. "[It's] going to lead to stagnant prices, if not rising prices for the foreseeable future."
The governor set a goal to build 35,000 starter homes priced under $400,000 each by 2028, but they're far from the finish line. Developers contracted by the state built about 5,000 homes in 2024. Waldrip said the state needs to build about 7,500 homes per year to meet the self-imposed deadline.
There are a handful of challenges standing in the way, though. The largest one is zoning. Many municipalities throughout Utah don't authorize smaller plot sizes and high-density housing. The average home size in Utah is 2,800 square feet.
"That's not attainable for somebody who is working as a nurse or working as a police officer, a firefighter, or even a married couple that have a teacher and nurse in their family," Waldrip said.
Loosening up zoning regulations, Waldrip argues, would allow developers to build smaller homes and high density housing, like condominiums and townhomes. But he added that there is a lot of fear around the impact of density and that fear "is driving local policies." As a result, he said, "it's hurting our long-term future."
The governor doesn't have the power to change zoning ordinances. That's in the hands of local governments or the Legislature. Cox has pleaded with cities to make it easier to build various kinds of housing, but there haven't been many takers.
Some lawmakers have repeatedly tried to pass sweeping changes to zoning, including mandating smaller lot sizes or allowing accessory dwelling units statewide, but it never makes it to the governor's desk. Waldrip said the Legislature has been reluctant because "there is such a preference for local control and having each community determine their own needs."
Waldrip said they are trying to do as much as they can with what they have. For example, he said the Legislature passed a bill this year to turn surplus land owned by the Utah Department of Transportation into affordable housing. He said there is also unused state-owned land that could be transformed into housing.
"We're documenting and cataloging all of the public land that we own, and then we're going to put it out to the market and see what we can do to use that to create additional supply," he said.
There are "literally thousands of acres" that aren't being utilized, he said. The hope is a website listing public parcels will be up and running by the end of the year.
But as Waldrip and his team try to find innovative ways to increase supply, he is ringing the alarm on housing. He said only 8% of non-homeowners can afford a median-priced home in Utah. With homeownership out of reach, he's deeply worried that people will be unable to build generational wealth.
"It will change our society fundamentally in ways that make the American dream really go away."
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