This is Derek Miller Speaking on Business. Cushman and Wakefield is a leading global real estate services firm, with offices in 70 countries worldwide. Kip Paul is Vice Chairman of Investment Sales with the Salt Lake office and offers his insight into Utah’s fast-growing marketplace.
As you drive around downtown Salt Lake, you’ll see what seems like endless apartment construction. Currently we have approximately 9,000 apartment units under construction with another 9,000 units in various stages of planning, including four new high-rise projects.
What is driving this development? Simply stated – it is demand.
Last year, about 160 people a day moved to Utah and new households were being created at a record-breaking pace. With that pressure, rental rates increased around 12 percent as supply barely kept up with demand. Our current vacancy rate stands at two percent, which is creating further pressure to increase prices.
While these rate increases are not good news for renters, developers are also facing dramatically increasing construction costs, which also adds to the pressure to increase rental rates. The forecast moving forward is more of the same.
Salt Lake City has been discovered. And there is no closing the door.
To help keep prices in check, Governor Cox has proposed legislation that would cut regulations that needlessly increase Utah’s housing prices. Legislators are also considering the Governor’s proposal to spend more $200 million for affordable housing projects. I’m Derek Miller with the Salt Lake Chamber, Speaking on Business.