Legislature amends housing laws to promote affordable small lot residential development

On December 27, 2024, Utah lawmakers introduced H.B. 37, a legislative bill aimed at addressing the state's growing housing crisis by promoting increased residential development in designated areas. The bill seeks to facilitate the construction of affordable housing by allowing municipalities to implement density overlays in housing-eligible zones, which could lead to more efficient land use and a greater variety of housing options.

One of the key provisions of H.B. 37 defines "small lots" as residential lots measuring 5,400 square feet or smaller and outlines what constitutes "undeveloped" land. The bill permits municipalities to designate certain undeveloped areas for increased density, enabling them to impose requirements that ensure a portion of the new residential units are affordable. Specifically, the bill mandates that some units be deed-restricted for owner-occupancy for up to five years or be sold or rented at prices affordable to households earning no more than 120% and 80% of the area median income, respectively.

The introduction of H.B. 37 has sparked discussions among lawmakers, housing advocates, and community members. Proponents argue that the bill is a necessary step toward alleviating the housing shortage in Utah, which has seen a significant increase in population and housing demand in recent years. They emphasize that the bill could help lower-income families access homeownership and affordable rental options.

However, the bill has also faced criticism. Some opponents express concerns that increased density could lead to overcrowding and strain local infrastructure. Others worry that the focus on small lots may not adequately address the broader issues of housing affordability and availability in urban areas.

The implications of H.B. 37 extend beyond immediate housing needs. Experts suggest that if passed, the bill could stimulate economic growth by attracting new residents and businesses to the state. Additionally, it may contribute to a more diverse community by providing housing options for a wider range of income levels.

As the legislative session progresses, H.B. 37 will likely undergo further scrutiny and debate. Its potential to reshape Utah's housing landscape makes it a significant topic for residents and policymakers alike, highlighting the ongoing challenge of balancing development with community needs.