Utah Foundation’s 2020 Utah Priorities Project found that housing affordability is a top issue to Utah voters. Previous Utah Foundation research indicated that housing affordability was of much greater concern among renters than homeowners. While the increasing cost of owning a home is potentially offset by record low interest rates, there is no such offset for renters.
The U.S. Department of Housing and Urban Development uses a national survey to calculate the Fair Market Rent, set to reflect the cost of rent for below-average, but reasonably-quality rental residences including utilities (read more about the methodology).
In 2021 the Salt Lake metro area had a fair market rent of $1,690 for a 3-bedroom residence. This is among the most expensive areas calculated in the U.S. – more expensive than 94% of the other areas measured. However, when comparing the Salt Lake metro area’s fair market rent over the past five years to other regional metropolitan areas, it falls among the middle of the pack.
The data tell a similar story when looking at the fair market rent’s rate of increase over the past five years.
The coronavirus pandemic introduced a lot of uncertainty into the picture in 2020 and 2021. If the pandemic had produced a standard economic recession, rental rates would have been expected to fall (backup link) as families would have been forced to move out of existing housing and double up with friends or family. However, this has not been the case as rental prices have continued to increase across all five metro areas from 2019 through 2021. This could be due to the quick economic recovery Utah experienced, the availability of rental assistance, or moratoria on evictions.
Additionally, while rents are still increasing, trends across large metro cities in the West do show the rates of growth falling beginning May and June of 2020. Cities in the U.S. Census West region of the United States saw rents increase from 4% to 6% annually from 2017 to 2019, but current rates of growth (January 2021) are under 2%.