Latest news with #HB151
Yahoo
25-02-2025
- Business
- Yahoo
Utah lawmakers shut down housing bill meant to give Utahns an edge over corporate home buyers
A home for sale in Salt Lake City is pictured on Monday, July 22, 2024. (Photo by Spenser Heaps for Utah News Dispatch) A bill meant to give everyday Utahns a slight edge over corporate buyers didn't survive its first legislative hurdle after lawmakers expressed concerns about restricting the housing market and potentially causing home sellers to face fair housing lawsuits. The House Political Subdivisions Committee on Tuesday voted 5-2 to hold HB151, a bill sponsored by Rep. Gay Lynn Bennion, D-Cottonwood Heights. It's not likely to gain traction in the 2025 Utah Legislature, with the session scheduled to end March 7. With HB151, Bennion wants to give Utahns a bit of an edge over corporate buyers of single-family homes in Utah's most populated county. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX To encourage Utahns to have first dibs on a home after it hits the market, HB151 would restrict a buyer from purchasing a home in Salt Lake County for 30 days after it's listed unless the buyer signs an affidavit of intent to live in the home for at least one year. To avoid taking too much of a heavy-handed approach, Bennion included a provision in the bill to allow sellers to sell to anyone in the first 30 days if they claim a need to sell the home faster, or if a renter would live in the single-family home on the day the buyer takes possession of it. 'This bill provides a cooling-off period for investors in (Salt Lake County) for the purchase of single-family homes, but also respects the seller and allows for the use of an exigent circumstance to accept any offer,' Bennion said. Her bill would also prohibit the bulk sale of foreclosed single-family homes to one buyer or more. 'The goal of this bill is to raise the moral question of home ownership to the transaction of the sale and purchase of single-family homes in (Salt Lake County),' Bennion said. How much of Utah's housing market is corporate-owned? This county is digging into the data She pointed to recent Salt Lake County data compiled by the Lincoln Institute of Land Policy that showed 10,666 homes changed hands from non-corporate owners to corporate owners between 2018 and 2023. Utah News Dispatch reported on that data in August. Across the nation, institutional investors impact some cities more than others — and they're not as nearly prevalent in Utah as they are in major metros like Miami, Houston and Atlanta. But Bennion argued it's still happening to a concerning extent in Salt Lake County, and that Utah lawmakers should act to find ways to help Utahns have a better chance of competing with corporate buyers that can often offer cash. 'For three years, people have shared their concerns with me that investors are cutting into home ownership in negative ways,' Bennion said. 'Some investors use algorithms, some use cash, but they all push out the individual who is coming into home ownership for the first time and doesn't have those tools and experience.' Lisa Thompson, a real estate agent, sat alongside Bennion as she presented her bill. She said it would give people intending to live in the home a 'first shot' in the market, 'because it's hard to compete' with investors that don't have to jump through the same financing hoops as other buyers. However, she also said investors aren't as active in Utah as they were in 2020, when the West experienced a home buying frenzy amid the COVID-19 pandemic and low interest rates. But several real estate professionals and business owners spoke against Bennion's bill, arguing it wouldn't have a practical impact on bringing down the price of homes in Utah — but rather it would cause homes to sit on the market longer. Chris Sloan, a past president of the Utah Association of Realtors and a broker and owner of a real estate agency in Tooele, said that he supports Bennion's efforts to encourage home ownership but argued her bill would 'cause some real concerns.' 'This bill essentially requires the owners to give up first right of refusal to owner-occupied purchasers for 30 days,' Sloan said. 'First right of refusals, contractual right between buyers and sellers, is something that generally costs the seller money. Delaying a transaction for any period is expensive.' Taz Biesinger, with the Utah Home Builders Association, also argued 'this bill will not help the affordability crisis that we have in Utah.' He said investors are 'not a big player in the marketplace, Utah is unique that way.' 'This is just not part of the equation of housing affordability,' Biesinger said. Chris Gamvroulas, president of Ivory Development and president of the Utah Property Rights Coalition, also spoke against Bennion's bill. 'The solution to an under-supply is not to interfere in the exchange of real property between a willing buyer and a willing seller,' Gamvroulas said. Utah lawmakers say no to 'preemption,' halt 2 housing bills aimed at allowing smaller homes But Clark Bolin, a Murray resident, urged lawmakers to support the bill, arguing that 'merely building more homes has not worked. That's something that we keep trying, and it's not happening.' 'I don't think this is a perfect bill. And I don't think it actually goes far enough, honestly,' Bolin said, urging lawmakers to consider taxing corporate buyers at a higher rate than private owners. However, he said Bennion's bill 'starts the ball rolling on a really important conversation of home ownership and really allowing the private investor to have a leg up and a head start over corporate ownership.' Jennifer Cottam, a real estate agent in Cottonwood Heights — a city known for its desirable real estate near the base of the Cottonwood canyons — spoke in 'strong support' of Bennion's bill, saying she's seen first-hand the impact from corporate buyers. 'I work with families who are doing everything right. They're saving. They're planning. They're working hard,' She said. '(But) especially when the market's tough and (for) lower-price point homes, they're outbid by cash offers from investors.' However, Rep. Neil Walter, R-St. George, motioned to hold the bill rather than allowing it to advance to the House floor. While he said he's supportive of the 'principle of home ownership,' Bennion's bill 'is just the wrong tool to accomplish that policy objective.' 'I'm concerned that we're trying to use sellers as a public policy tool to make concessions … we're trying to force sellers to make concessions as part of our public policy objective,' Walter said. 'They don't have an obligation or shouldn't bear that cost.' Walter also expressed concerns about requiring sellers to pay attention to who they're selling to, which he said could 'create an avenue where we're going to end up with a whole bunch of fair housing violations.' The majority of the Republican-controlled House committee agreed with Walter, with only Bennion and Rep. Jake Fitisemanu, D-West Valley City, voting against his motion to hold the bill. SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
28-01-2025
- Business
- Yahoo
Perspective: Little nudges might bring big benefits for Utah's housing market
Gov. Spencer Cox offered a clear-eyed vision of Utah's priorities in his 2025 State of the Union address. He has rightly highlighted lack of affordable housing as the most pressing problem facing the state. With its growing population, the pain is felt across the board, but is especially keen for young families who are finding it particularly difficult to get on the property ladder. To meet their needs, Cox proposes building 35,000 starter homes under $400,000, complemented by a raft of supporting initiatives, some of which were passed during last year's legislative session. One of those bills passed last year addressed an issue which caught my eye: the First Home Investment Zone Act, allowing new zoning regulations to facilitate the construction of starter homes, and allowing cities to insist any public investment be contingent on the zone only allowing projects where 50% of the homes are deed-restricted to remain owner occupied for 25 years. This restriction is important, for there has been a growing trend of large Wall Street investment firms scooping up such new construction to turn them into rentals, charging exorbitant rents in the process. Investment firms have robustly moved into the single-family housing market in addition to their traditional interest in multiple-family dwellings. Approximately 1 in 5 homes is bought by an investment firm now (in some areas, it's 1 in 3), and homeownership rates are dropping. In the 1970s, homeownership stood at about 63%; among young adults, it's now down to 37%, and that's not necessarily by choice. Investment bidding, cash in hand, on housing has driven up prices dramatically. So the deed restrictions on the starter homes Cox is hoping to build are an excellent step in the right direction. But what about existing homes? Is there some good way to nudge things toward owner occupancy there, so that the state and its families will be better off? In this legislative session, that nudge may well be HB151, entitled Home Sales Amendments, crafted by Rep. Gay Lynn Bennion, D-Cottonwood Heights. In a nutshell, the bill — which only applies to single-occupancy homes — proposes very little, but that little could make a real difference to Utah families. It states that for the first 30 days when such a home is put on the market, a would-be purchaser would be required to sign an affidavit of intent to occupy (unless the seller incurs an exigent circumstance). It would also prohibit bulk sales of foreclosed single-family homes, which are overwhelmingly sold to investors. After those 30 days, that affidavit requirement would terminate. Asked why she is sponsoring the HB151, Bennion says, 'Young people in Utah really want the Legislature to start this conversation. I know of a young couple that lost bids on 12 homes in Salt Lake County to investors before finally being able to purchase a home. Another young couple finished professional school out of state and want to move back to Utah. They found a home for around $450,000, but an investor outbid them and then offered the same home for sale a month later for $570,000. Realtors are seeing the frustration in the market, and want more of an even playing field for families.' Jen Cottam, a real estate professional with ERA Brokers Consolidated and an advocate for sustainable growth and home ownership, is one of those realtors. Cottam sees the problem every day: 'The Utah housing market is in crisis, particularly for first-time buyers and families looking for affordable homes. Between 2018 and 2023, Salt Lake County lost over 10,600 owner-occupied homes to rentals. Cities like South Jordan have seen almost exclusively build-to-rent developments over the past two years. This imbalance favors investors and large institutions, leaving Utahns struggling to compete for home ownership. The consequences are far-reaching: reduced civic engagement, declining family stability and financial insecurity. Renters in the U.S. have a median net worth of $10,400 compared to $400,000 for homeowners, according to the Aspen Institute. This wealth disparity threatens long-term economic equity for Utah families.' When asked specifically about HB151, Cottam commented: 'This bill is very moderate and seeks to level the playing field by giving individual buyers a window to purchase single-family homes before investors can step in. In a strong sellers' market, it is the first-time homebuyer that struggles the most. They have difficulty when it comes to competing with offers that waive inspections, have non-refundable earnest money, and waive financing and appraisal contingencies. It's a pragmatic step that helps give Utah families have a fair shot at home ownership. '(The bill) actually corrects a market distortion. Investors hold significant competitive advantages — access to cash, economies of scale, and minimal barriers — that ordinary Utah families cannot match. This bill is a step toward ensuring the market works for Utahns, not just for institutions.' Ray Colledge, an associate broker with 29 years in the Utah real estate market, agrees: '(The bill) gives those getting a mortgage an opportunity to make an offer without competing with a cash buyer ... I believe it is a crisis (and) measures need to be taken to equalize fairness. I believe the two most urgent issues facing Utah are the shrinking Great Salt Lake and the housing affordability crisis.' Some may wonder if sellers might be hurt by the bill. Cottam disagrees: 'Sellers will still get market value for their homes, but the buyer pool is temporarily prioritized to benefit families seeking primary residences. This is a small adjustment with a big impact. In addition, this legislation is creating an awareness for sellers to consider helping families over investors. If they have circumstances where waiting is going to negatively impact them, then they do not have to comply with the waiting period.' Both Cottam and Colledge believe that HB151 advances Cox's agenda on housing affordability for Utah families. Cottam notes, 'Gov. Cox has been vocal about the challenges of housing affordability and declining home ownership rates. This bill aligns perfectly with his priorities and his vision of preserving the Utah way of life. I believe he should support this bill as a meaningful step toward addressing the housing crisis.' Behavioral scientists have, in recent years, advocated such small 'nudges' like HB151 to get people to stop and think more about the decision they are making. Nobel Prize-winning economist Richard Thaler, along with Cass Sunstein, wrote an entire book about 'nudges' and how noncoercive alterations of a decision maker's environment could create significant changes in behavior. The key task for policymakers is how to gently alter the context for the decision, making some often-overlooked information more salient for the decider, or providing additional time for the decision to be made. HB151 is a textbook case of just such pro-social nudging. As a social scientist, I could even see other nudging initiatives that might help the Utah housing market tilt more towards families than Wall Street investors. Bennion's legislative research found that 'Some states, such as Idaho, require as part of their purchase agreement that the buyer disclose whether they intend to use the home as their primary residence.' This is for the purposes of determining whether the state property tax homeowner's exemption benefit is applicable. There is no reason a similar requirement for disclosure to the seller up front during the purchase process cannot be required in Utah. Another initiative that has been used by numerous municipalities across the country is endowing cities with the 'right of first refusal' to purchase run-down or foreclosed homes to strengthen particularly fragile neighborhoods. These cities then renovate the home to code and sell it on to first-time homebuyers, often with purchase assistance. As Utah tackles its serious housing crisis, the type of creative 'nudging' exemplified by HB151 deserves the governor's and the Legislature's attention and support. HB151 — track the bill this session; contact your state representatives about it. Give Utah families a little bit more of a chance to buy their own home.
