UTAH (ABC4) – It seems like they’re everywhere: shiny, new apartment and townhome complexes – most with the same blocky, modern facades. But although they certainly don’t add architectural diversity to our communities, these units haven’t arrived without reason.
It’s no secret that Utah is growing.
Between 2020 and 2021, the Beehive State experienced an annual population growth rate of 1.8% – which is the highest since 2017 – according to data compiled by the Kem C. Gardner Policy Institute at the University of Utah. This averages out to about 160 residents per day, Emily Harris, the Gardner Institute’s senior demographer, said in a press statement. Salt Lake County contributed 15.9% of this growth.
On the one hand, it’s important that the area is building more units to keep up with demand, but some parties are concerned that corporate-owned rentals — like the blocky buildings encroaching on our city — are having a negative impact on our already tight housing market.
“Housing is no longer a shelter, it is a portfolio,” says Tara Rollins, executive director of the Utah Housing Coalition. “The bigger the portfolio becomes, the more they want to make. So that’s what’s happening with these corporations coming in and purchasing apartment complexes and getting them under their wing.”
According to Paul Smith, executive director of the Utah Apartment Association, at least half of Utah’s 300,000 rental units are owned by Utahns. Most of these mom-and-pop rentals are single-family homes and duplexes. The majority of larger apartment blocks, on the other hand, are owned by corporations or management companies.
And although Smith says this housing makeup is very similar to the way it has been for the last 20 years, it’s no secret that housing prices have skyrocketed recently.
According to the Utah Association of Realtors, the average home price in Salt Lake County rose a whopping 22.7% between October of 2020 and 2021. Additionally, a report from Realtor.com ranked Salt Lake City as the top housing market going into 2022. According to the report, Salt Lake City’s current median home price falls at just above $564,000 and prices are expected to grow by 8.5% this year.
But, there are likely many reasons why prices are on the rise in Utah and in Salt Lake City, not just corporate rentals. According to Smith, it really just comes down to supply and demand.
“The number one thing that affects the landscape of rentals is lack of supply,” he says. “We have more people looking for places to buy and live in and rent and live in than we have supply.”
Still, corporate ownership is likely to not be innocent in all of this, either.
Rollins says, beyond simply having enough units, it does make a difference who owns these units. Not only do larger, corporate landlords have to charge each unit a specific amount for their management — which covers things like building security, landscaping, and lawn care — there’s a human disconnect between corporate owners and their tenants.
“It’s a big difference between a smaller landlord and a corporate landlord,” Rollins says. “When you see the smaller landlord, they care about the community and the people in the community.”
And, with the way the laws are written currently, Rollins says that landlords are favored more than tenants, so those who are struggling financially could easily be pulled underwater by restrictive and unforgiving corporate policies.
She cites the typical three-day “pay or vacate policy” that is put into effect in the instance that a tenant doesn’t pay their rent on time. This means that every day after those three days, if the tenant doesn’t vacate, they have to pay triple the rent.
In an example given by Rollins, if the daily rent was $50 per day, the tenant would have to pay $150 after 3 days, with late charges added.
“They’re making so much money off the backs of poor people, I mean, financially crippling them,” she says.
So, what can be done to help Utah’s housing situation?
Rollins says, in addition to developing laws that favor tenants and landlords equally, it’s important that the state invest in affordable housing for tenants.
And we might well be on the way. In her January 25 State of the City address, Salt Lake City Mayor Erin Mendenhall discussed the 345 affordable units that were built last year and announced plans for 735 more on the way.
But beyond affordable units, good jobs are also crucial to Utahns’ ability to continue living in the state. Bringing in higher-paying, career-oriented jobs will also help with our housing crisis, Rollins says.
So, with all the changes coming with population growth, hopefully more — specifically ones that will help Utahns afford to live in our state — will be on the way, too.