In November 2024, a legislative audit highlighted Utah’s critical need for more housing. Auditors estimated the state needs nearly 28,000 new housing units built yearly to keep up with projected population growth. The audit warned that Utah could face severe housing shortages without significant changes to zoning laws, leading to skyrocketing prices and reduced affordability. In response, Utah lawmakers are working on several bills to increase the housing stock through upzoning and other measures.
Key bills addressing housing stock
Several bills are currently being considered to address Utah’s housing crisis:
- Statewide housing plan: This comprehensive plan includes upzoning elements to increase the number of affordable, owner-occupied homes. It aims to allow higher-density housing in certain areas and promote the development of accessory dwelling units (ADUs) to provide more housing options.
- Permitted use for single-family homes and ADUs: Proposed by Representative Ray Ward, this bill would make single-family homes and ADUs a “permitted use” on any residential lot size in urban cities. This change aims to simplify the approval process and increase the availability of affordable housing.
- Short-term rental regulations: Representative Neil Walter has proposed re-evaluating the state’s regulations on short-term rentals. The goal is to balance the benefits of short-term rentals with the need for long-term housing availability.
These bills reflect a concerted effort by Utah lawmakers to address the housing shortage and ensure that the state can accommodate its growing population.
Impact on the construction and real estate
Higher-density development will create new opportunities for developers, contractors, sub-contractors and others in real estate and construction. They will need to adapt to the increased demand for multi-family units and ADUs, which may require new skills and approaches. Collaboration with local governments and community stakeholders will also be crucial to ensure that new developments meet the needs of residents and align with broader urban planning goals.
Getting projects off the ground will still be challenging
Adjusting to this shift in housing priorities, laws, and regulations will require new approaches. Still, getting the projects off the ground will still require business agreements, contracts, documentation and problem-solving. Disputes are a part of the construction business, perhaps more so as everyone pivots to address the legislative changes to zoning that are coming in 2025.