This story appears in the 2025 Advisor, a publication sponsored by Colliers Utah.
Clark Ivory, CEO of Utah’s Ivory Homes, is waiting for innovation in the housing market. The last major idea to boost home accessibility, he says, was the development of the 30-year mortgage just after World War II.
Closing in on a century later, the housing market across the country is in a bind, tied up by changing work and cultural habits that are exacerbating outdated policies and infrastructure.
Residents in the United States are watching their cost of housing increase while inflation and wages have struggled to keep up despite slow growth at mid- and lower-bracket income margins. During the pandemic, many people drove up the cost of housing nationally by moving out of cities; in rural areas, a lack of available housing has followed, even for those who can afford it.
In this context, Utah has become one of the states hardest hit. As a high growth state with new businesses and startups opening each year, the population increase and changing infrastructural needs have amplified the problem.
A 50,000-unit housing deficit
“We need to create 27,000 homes a year in our market over the next 10 years to keep up with what the demographers are suggesting will be the number of households created,” Ivory says. “We only produced 22,000 this year, so we’re 5,000 short. And we probably have somewhere between a 40,000-50,000 deficit already. People are doubling or tripling up, and they can’t get into housing; they can’t afford it.”
For Ivory, a lot of the problems stem from inconsistency in the market for building new homes. Pointing out that much of the regulation and approval for individual housing projects happens at the municipal level, he argues it can be challenging to create statewide change to allow new construction to flourish.
In some areas, he says, local officials can oppose new housing overall and maintain rules that make it difficult or inefficient to create new housing. One rule that stands out to him is localities that require new homes to be built with a garage — which can add significant costs to construction and the eventual purchase or rental of homes.
“There needs to be a movement toward design that figures out great ways to deliver smaller homes. [Regulators are] not really focused on the mid-range. And the truth is, what we have to start talking about that will really unlock supply is housing affordability matters at every level.”
— Clark Ivory
“The bottom line is, we have a supply deficit right now,” says Steve Waldrip, senior advisor on housing strategy and innovation to Gov. Spencer Cox. “So our focus is on creating supply, and then within that supply, we’re focused on creating ownership opportunities.”
Some of the ideas being discussed by policy experts and industry players include repurposing public lands that are not being used, loosening regulations to create mid-tier housing accessibility, tapping into state resources to ensure interest rates can remain low, and restructuring commercial real estate for housing use.
Utah’s business community sees these changes as a way to ensure continued growth for companies across the board.
“We see it as not just a critical issue for the state of Utah in terms of our long-term economic prosperity for the middle class to be able to afford to live here, but also to retaining great companies and attracting great companies,” says Scott Cuthbertson, CEO of the Economic Development Corporation of Utah. “We just don’t have enough housing. And this is a nationwide issue, but it’s particularly acute in the Intermountain West and Utah specifically.”
Waldrip points out that affordability is a major limiting factor.
“For 90-100 years, as a general rule, the cost of a home has been three times the median wage,” Waldrip says, saying that only major cities on the country’s coastline acted as outliers. “That’s how our whole financial system is set up. … That’s what allowed everybody to finance homes, save money for down payments, and it was a reasonable ratio.”
In Utah, housing costs are now 6.2 times the median wage, he says.
“Utah is the third highest behind Hawaii and California,” Waldrip says. “Essentially, we’ve cut affordability in half.”
Incentivizing mid-tier housing development
One possible solution is the state’s rainy day fund, says Dejan Eskic, senior research fellow at the Kem C. Gardner Policy Institute. This fund has reserves that can offer low interest rates to home buyers.
“The state has taken like $300 million of that to do a pilot program where, if you have projects that meet certain thresholds on affordability, we’ll give you a low interest rate loan to help develop your infrastructure or help offset some of your costs,” he continues.
Eskic argues the current regulatory environment makes mid-tier housing projects inefficient for developers.
“Builders are building the bigger stuff because that’s the product they can move right now,” he says of high-end housing. Eskic points out that more affordable homes are not ideal for developers because of local requirements they have to meet.
“You’re going into a greenfield development, and you’re going to have a huge battle with the city, but at the end, you’re going to make about the same money — maybe a little less because you’re going to single-family,” he continues.
Urban density vs. costly suburban sprawl
For Waldrip, this environment has created a dynamic where the state has to adjust its role.
“The government used to only have to get involved in subsidized housing and the lower economic strata,” he says. “Because of these seismic shifts in the market structure, we’re going to have to be more thoughtful about how we intervene, or — probably more accurately — remove obstacles to the creation of more housing.”
Cuthbertson points out this can also be approached through city planning and urban design. Culturally, a lot of focus has been on housing in suburbs, which can come with major transportation needs. But he suggests that there are solutions within cities themselves.
“If you don’t want to sprawl, then you need to go up vertically,” Cuthbertson says. “The sprawl problem adds congestion, adds to commute times and creates problems. It’s costly.”
This hits home for Ivory. He argues that many developers want to access the middle of the market.
“There needs to be a movement toward design that figures out great ways to deliver smaller homes,” Ivory says. “[Regulators are] not really focused on the mid-range. And the truth is, what we have to start talking about that will really unlock supply is housing affordability matters at every level.”