SALT LAKE CITY — Finding a place that won’t strain your budget may become more challenging across the Salt Lake Valley as growing housing demand combines with a labor shortage, sending up the costs for a home, a new report indicates.
“The ability to deliver a new home under $200,000 in the Greater Salt Lake market is diminishing quickly,” said Eric Allen, director of Metrostudy’s Utah/Idaho region. “New home starts in this segment have decreased 17 percent compared to last year, while the majority of this activity is for attached product.”
According to Utah-based Metrostudy, Salt Lake builders reported a 17 percent jump in the volume of new home starts in 2016 over the 2015, for a total of 10,778 new units.
The survey also noted that were it not for a severe shortage of labor, the number of new homes built would have been even higher.
“New home production during 2016 was very strong, and while not back to peak levels, the market is definitely experiencing robust growth,” Allen said.
He also said builders are struggling to find enough skilled labor to build homes. Over the past eight years, the labor pool has thinned out significantly, he said.
“Since the recession, a lot of people have just left the (construction) business altogether,” he explained. “Even if (builders) wanted to hire more people, there just isn’t anyone to hire.”
Allen attributed some of the labor shortfall to the Trump administration’s tough immigration policies, which have impacted the undocumented immigrant population that often worked in a number of construction trades.
The threat of deportation may worry some laborers that would otherwise fill jobs on construction sites, he said.
“There are not as many people coming in from other countries,” Allen said. Additionally, the younger generation of the homegrown workforce doesn’t seem to be as interested in trade jobs, he said.