What BYU students, alumni have to say about Governor Cox’s new homebuyer program
Utah Governor Spencer Cox’s “Utah First Homes” program for new homebuyers is a generally welcome — though still unheard of — idea, according to BYU students and alumni.
“I believe the single largest threat to our future prosperity is the price of housing. Period,” Governor Cox said in his 2024 State of the State address on Jan. 18. “No one has figured this out yet, and I truly believe that we can.”
The “Utah First Homes” program announced on Dec. 5, 2023 is the first attempt at fixing this threat, Governor Cox said.
BYU alumna Sarah Wilson agreed the market has been a threat since she bought her first home in Provo as a single woman in 2017.
“From what I’ve heard it’s still very competitive. There’s a lot more people that want homes than are homes available,” Wilson said. “It seems like it’s very difficult to find anything under $350,000-$400,000 for a starter home, which is crazy.”
Built in the 1920s, her first and current house was purchased at $285,000 and has gone up to almost $500,000.
Besides the competition among few homes for sale, another major concern Wilson described is the purchasing power of large investor companies that buy out young couples.
“The thing that I wish would be more limited or controlled are these big huge companies that come in and gobble up land and then build these cookie cutter houses on them and sell them to people,” Wilson said. “There’s a lot of land and real estate being purchased by large corporations, and so individuals and families don’t get as much of a chance.”
Davin Olsen, a current BYU student, is a homeowner with two rental homes just south of BYU campus. He shared concerns from when he and his wife, Rachel Olsen, purchased their first home.
“The crazy thing is every house that we went to, there would be like, 40 other people looking through that house and wanting to buy that house. And the craziest bit is there were people that would represent big asset-management companies and big hedge funds and things that would come in and just buy the house in cash,” Olsen said.
The only reason they ended up finding a house was because they stumbled upon one just 15 minutes after it went on the market — before big investors had a chance to check it out, he said.
“We basically said name your price, but whatever price you’re gonna say let’s go under contract right now … I think we had to pay like $25,000 above asking price for it, and it was built like 120 years ago. It was like built by Brigham Young, like ancient,” Olsen said.
These concerns about home age, value, and competition appear in the “Utah First Homes” program, which allocates $150 million dollars of the proposed budget to support new home buyers, according to the Governor Cox’s official press release.
The program includes:
- A plan to build 35,000 new starter homes by 2028
- $50 million in first-time home buyer assistance to help with down payments, interest rate buy-downs, and closing costs
- $75 million to the State Infrastructure Bank to support water, sewer and roadway expenses that come with new homes
- $5 million to a Starter Home Innovation Fund to find and incentivize solutions for housing affordability
- $15 million to sweat equity programs
- $5 million to Community Land Trusts that help divide land ownership and impose deed restrictions to keep housing affordable
Neither Olsen nor Wilson had heard of this program previously. Both homeowners said the program sounded like a great idea but expressed some concerns about its effectiveness.
Increasing accessibility to new homes with first-time homebuyer assistance will crowd the market and still cause home prices to increase, Olsen said.
“If I were to talk to Governor Cox, I would be a lot more in favor of taking that funding and putting it towards building more houses as opposed to giving buyers more purchasing power,” Olsen said.
He said he hopes that doing so will increase competition between sellers, causing prices to fall for new homebuyers without decreasing the value for current homeowners.
“That is why I have proposed the ‘Utah First Homes’ program, with the audacious goal to build 35,000 starter homes in the next five years,” Governor Cox said in his 2024 State of the State address. “While we need more of everything, my focus is on affordable, attainable, single-family, owner-occupied, detached housing.”