The Salt Lake City metro area is expected to need 16,478 new apartments by 2030 to keep up with local demand, according to a new study commissioned by the National Multifamily Housing Council (NMHC) and the National Apartment Association (NAA) and conducted by Hoyt Advisory Services. The study found that, nationally, 4.6 million new apartments are needed by 2030.
An aging population, international immigration and fewer home purchases are resulting in an increased need for new apartments, the report said.
The report said it’s important to note that locally:
• Salt Lake City will need to increase its existing number of apartments by 22 percent by 2030, and ranks No. 18 out of 50 metro areas in terms of the percent increase in demand for new apartments by 2030.
• The Salt Lake City metro area will need all types of apartments and at all price points.
• Hoyt estimates that there are currently 75,902 apartments in Salt Lake City, with residents that span the age and income spectrum.
• Salt Lake City apartment developers, owners and managers and their residents contribute $2.7 billion to the local economy annually.
“Nationally and here in Salt Lake City, we’re experiencing fundamental shifts in our housing dynamics, as more people are moving away from buying houses and choosing apartments instead,” said Paul Smith, association executive of the Utah Apartment Association. “Our local economy is strong, led by the professional services and education sectors. Today’s renters are younger, with smaller households and strong incomes. Salt Lake City’s rental stock has fewer older, more affordable apartment units compared to other metro areas. With only modest increases in migrations to the area, natural population growth will be the driver for new rental households. Demand for apartments is expected to steadily increase through 2030.”
The increased demand for apartments is due in large part to:
• The aging population. People 65-plus will account for a large part of population growth going forward across all states.
• Immigration. International immigration is assumed to account for approximately half (51 percent) of all new population growth in the U.S., with higher growth expected in the nation’s border states.
• Delayed house purchases. Life events such as marriage and children are the largest drivers of home ownership. In 1960, 44 percent of all households in the U.S. were married couples with children. Today, it’s less than one in five (19 percent).