SALT LAKE CITY (KUTV) — A recent study revealed a harsh reality for would-be home buyers in Utah: You now need a six-figure income to buy a home in the state — a feat that was achievable with an $80,000 income just five years ago.
According to a Bankrate.com study, potential homebuyers in Utah need to earn $134,000 a year to afford a home with an average price of $525,000.
Currently, in about half of U.S. states, you need a six-figure income to buy a home.
MORE: How much do you think you need to earn per year to buy a home in Utah?
Utah and Wyoming topped the list of states that saw the biggest increase in the annual income needed to buy a home since 2020.
Adrian Lane, a part-time chef who works multiple jobs, symbolizes the struggles in Utah: Even though he and his wife, Jacqueline, earn a combined annual salary of about $80,000 and run several small businesses, including a daycare, homeownership remains out of reach.
“We didn't qualify for anything,” Lane said. “We looked on the market and couldn't find anything within our budget.”
Al Bingham, a veteran loan officer in Utah, verified the information in the Bankrate study.
“In many cases, we're seeing parents come in and cosign and help their child pay,” Bingham said.
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The housing market downturn is the result of a confluence of factors, including an influx of cash-rich West Coast buyers who purchased homes in Utah before the pandemic.
Then, the housing shortage was exacerbated by falling interest rates due to the pandemic.
As interest rates rise in 2022 and 2023, buyers like Mr. Lane feel even more squeezed by rising home prices.
“The real issue here is we're going to lose an entire generation of home buyers and home owners,” Bingham said.
Read more: Utah: Most affordable state in the nation, but third least affordable for homebuyers
Bingham said he was concerned that young people who don't buy homes now will miss out on assets that could help fund their future retirement.
“That's scary,” he added.
Bingham advised those without family support or a six-figure income to be patient and persistent when searching for affordable housing.
Despite the daunting prospects, people like Layne are determined to continue pursuing their dream of homeownership.
“I'm a little nervous,” Laine admitted. “We're going to keep trying. That's our dream.”
As the housing market continues to evolve, many Utahns are faced with the harsh reality that homeownership is becoming increasingly out of reach.
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