Utah sees housing boom

Utah's estimated one-year housing growth of 2.6 percent outpaced nearly every other state, according to new estimates released today by the U.S. Census Bureau.

Only two states, Nevada and Arizona, grew at a faster pace than Utah, according to the estimates that cover housing unit growth from July 1, 2003, to July 1, 2004.

Utah gained an estimated 21,784 housing units from July 1, 2003, to July 1, 2004, growing from 826,953 to 848,737, according to the census report.

Washington County, meanwhile, was ranked 16th nationally, adding an estimated 2,639 housing units. The county's housing grew by about 6.2 percent to an estimated 44,909 units on July 1, 2004.

Utah's ranking is "a little surprising," said Robert Spendlove, manager of demographic and economic analysis for the Governor's Office of Planning and Budget.

"Our population growth, according to the Census Bureau, is not third," Spendlove said. Utah's population grew 1.6 percent for the same period — a rank of seventh in the nation.

Spendlove said the census estimates indicate that Utah has strong growth in secondary housing, such as condos or cabins.

The new data are consistent with several other areas of Utah's economy, Spendlove said.

The value of total permit-authorized construction in the state hit an all-time high of $4.9 billion in 2004, up 6.3 percent over the prior year, he said. Of that, residential construction comprised $3.4 billion — also a record high.

And from June 2004 to 2005, construction employment rose by 9.1 percent, adding 6,900 jobs to Utah's economy, Spendlove said. Overall, construction accounts for about 7 percent of Utah's economy, he said.

Chris Hart, president of the Homebuilders Association of Utah, said he's seeing "explosive growth," in southern Utah, which he says is driven by low interest rates and a large retirement population.

Realtors in the area are busy, to be sure, but so are construction crews.

"We've got half a dozen major developments either already moving dirt or in the process of being platted," said Vardell Curtis, Washington County Board of Realtors. "Resales are extremely strong, but so is new construction."

This "double-edged sword," as Curtis called the current level of growth, means more than good paychecks for those who work with real estate. It also means the cost of housing and the land it stands on is getting very pricey.

Curtis worries that California cash buyers may be artificially inflating the housing market, which could create a housing bubble.

"But let's don't discount greed in all of this," he added. "Some people are selling for more than their asking price."