Rent in Utah County may seem high to renters, but local contractors say it's not high enough to make constructing apartments profitable.

According to the Utah County Housing Development Task Force's report, construction of multiunit housing is not keeping pace with demand because it is not a good investment for developers. Construction also is inhibited because obtaining adequate financing is difficult. The report says more than 200 new housing units will have to be built annually to keep pace with demand."It's not profitable to build multiresidential units under the present financial arrangements and rental rates," said Dave Gardner, chairman of the zoning and building regulations committee.

The county Council of Governments organized the task force in May because vacancy rates dropped below 1 percent, rents increased sharply and landlord-tenant disputes increased dramatically. Four committees evaluated the extent of the countywide housing problem and recommended possible solutions in the report.

Gardner said the county's main effort should be toward providing more housing for low- to moderate-income families. Student housing is still profitable, and developers are devoting most of their resources in that direction.

Some believe the student-housing market will slow once Brigham Young University reduces its enrollment over the next few years. But Gene Carly, chairman of Utah County Housing Authority, said BYU's enrollment cap will be offset by increased enrollment at Utah Valley Community College. He said college officials, government officials, investors and builders should work together to solve the housing shortage. "Only as a last resort should UVCC and BYU on their own construct housing," Carly said.

The report says land costs will remain stable if cities allow multiunit construction in more areas. Construction of more upper-level housing would free housing for those less able to afford new housing.

The finance committee said money is available to qualified buyers, but many cannot qualify for a loan. A lender source book, containing information about loan requirements, should be made available to prospective buyers through real estate agents, builders and lenders.

The assisted housing committee said the housing shortage creates higher rents, which in turn reduces the amount of housing available to low-income families. Landlords also prefer to rent to individuals with a more stable income. The federal government's role in subsidizing low-income housing is more critical in a supply-short market, the report says.

The report says the existing housing shortage justifies local government officials actively seeking funding from the Department of Housing and Urban Development for public housing projects.

The alternative housing committee says manufactured housing plays a major role in providing adequate housing for the poor and elderly. However, many cities have ordinances that discourage manufactured-home parks because cities fear them becoming rundown and unsightly. The report recommends that cities adopt codes to keep mobile-home parks from deteriorating.

Jeff Mendenhall, chairman of the alternative housing committee, said most cities have manufactured-housing ordinances that would not stand up in court. Most are similar to Salt Lake County's, which recently was the subject of a federal lawsuit.

"It would be well for the smaller communities to take a good hard look at that," Mendenhall said.

Carly said a study to more accurately quantify and measure Utah County's housing problems will begin soon and the results should be available in March. Once the study is complete, it will be easier for government officials to tackle housing needs.


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Recommendations of Utah County Housing Development Task Force:

- Cities change master plans to allow for more multi-unit housing.

- Cities should provide incentives to builders who construct housing for first-time buyers.

- A developer/renter coalition should be created to assist financial institutions in making investment decisions regarding multi-unit developments.

- A source book that describes a lender's terms and financing requirements should be created.

- Local governments should lobby for reinstatement of capital-gains tax breaks and accelerated depreciation schedules.

- Local housing authorities should seek more federal funding for low-income housing projects.

- Communities should create non-profit organizations to encourage affordable housing for low-income families and the elderly.

- Cities should review manufactured housing ordinances to make sure they are not discriminatory.

- Congregate living guidelines and a review committee to help disabled or elderly who want to remain independent should be established.