Expository 2010 1st Place
Imagine that you are offered a new higher-paying job as an assistant principal in another city. You tell the boss that you are working for that you are quitting, and then you leave to look for housing in your new area. Imagine your heartbreak when you find that even with a new higher-paying job, you won’t be able to afford housing in the new area. You won’t be able to accept the new job offer after all. Stories like this are becoming more common in Southern Utah.
What is the driving factor behind these problems? Recently, Southern Utah has been experiencing a housing price boom. Last year real estate prices in Cedar City alone rose 23.2% according to Justin Ragona who has been a realtor for three years. St. George was higher with a whopping 28.34% rise in prices (Anderton). Housing prices continue to rise at an accelerated pace. Some people are adamantly opposed to the rapid rise of prices, while others are strictly for it. But with prices skyrocketing as they are, who can afford to buy a house? The rapid increase of property values isn’t good. It is altering the dynamics of Southern Utah by negatively affecting people in certain categories: the young and the old, families with one middle-class income, and providers of important services in the community.
Why is there a housing price boom in Southern Utah? There are four main causes: low interest rates, fewer building materials, an influx of people with lots of money, and the attractiveness of Southern Utah as a place to live. Low interest rates contribute because they allow people to borrow more money and buy more expensive houses. This causes builders to build more and better homes that are more costly, since houses are selling so well. As a result, it is harder to get building materials. Another contributing factor in the scarcity of building materials is that America is sending lots of building materials to help the citizens of Iraq rebuild. The scarcity of building materials causes them to cost more. The third factor in the rapidly rising prices is that people from places like California and Nevada, where housing prices are even higher, sell their houses for very large amounts of money and then purchase homes in communities where prices are lower. The fact that they can afford to pay more for housing contributes to rising prices for everyone else. The fourth major reason is tied to the third. Because Southern Utah is an attractive place to live, people are choosing to buy homes here. Here they can enjoy four seasons, clean air and water, a safe community, a university, many social functions, a small town atmosphere, and so forth. Currently there is less supply than there is demand in the Southern Utah housing market, driving prices up even higher (Englestead).
The quickly rising real estate prices are adversely affecting both the young and the old. People just starting to live on their own, including newlyweds, cannot afford to buy a house in the community. Even though housing prices are rapidly rising, wages are either slowly rising or they are not rising at all. The average house on the market now costs around $200,000. This is a problem because newlyweds cannot get a loan for that much money making it impossible to buy a house unless they have some other source of money (Ragona). According to Ron Englestead who has been a realtor for 24 years, young adults who were raised here will not be able to afford to buy a house here unless they have a really high-paying job. This means that young people will either have to rent, or they will have to leave the area and go somewhere else where they can afford housing. Renting is not so bad, but it is only a temporary solution. If they wish to raise a family, they are going to need a more permanent solution and more space. If a lot of young couples leave the community in order to be able to buy homes, there will be fewer young families in the area, which would cause the community to be imbalanced. There are some programs set up that help people afford housing. Some people believe that this solution is good enough (Page). The problem is that these programs require a lot of waiting and can only help a small number of people (Weaver).
It is not just the young that are affected but the elderly as well. The fact that the majority of elderly people already own a home does not spare them from suffering. Since property taxes are based on the value of their houses, the amount they must pay in property taxes continues to increase. This is a problem, because most elderly people are on a fixed income. If their property taxes are constantly and significantly rising, eventually they will not have enough money to pay property taxes, let alone survive. In other states, some people have already been forced out of their homes because of this problem. The elderly people in this community may be next. Some people may contend that there will not be fewer elderly people; there will just be different elderly people. Elderly people who built this community and gave it a strong foundation will eventually be forced to leave it if the trend continues in its present manner. Who has the right to do that to them?
Another category of people that is adversely affected are those families with only one middle-class income. Englestead states that it is hard for a person with a middle-class wage to buy a home. If a family with only one middle-class income wants to buy a home, then they will definitely either need to go somewhere else or have both parents working. It would change the dynamics of the community to have so many families with two working parents. Without the mother at home, raising children will be different. Children will spend less time with their parents causing them to be affected more and more by other influences such as schools, the community, and television. This could prove to be bad, since children could learn different or lower morals. The examples of how to live, which are shown on television and in other places, would be more present to them than the examples of their parents. It would also mean that it would be easier for children to get into trouble because they would have more unsupervised time. Parents and children would have a harder time forming strong relationships and families, since they would spend less time together. All of these things would change the community to an extent. On the other hand, going somewhere else means uprooting the children from their friends and the atmosphere to which they have become adjusted.
Some people believe that it will not be necessary for people to move elsewhere or to have many families with both parents working. They say that the current influx of people and residential boom will bring commercial and industrial booms, and thus higher wages. This would make it so that middle class workers could once again afford housing (Page). There is truth to this argument, but so far “most people coming into Cedar City now are generating no new money. They are on a fixed income” (Englestead). The majority of the people coming in are not working-class people, but retired people. We may, however, yet see a large amount of new jobs created.
Rapidly rising property values are also negatively affecting people who provide important services in the community, such as policemen, teachers, nurses, and road and water department workers. This, in turn, will change the community. With real estate prices rising as they are, it is becoming constantly harder for people in these professions to afford housing in this area. They may soon be forced to relocate or change their jobs, causing the number of people working in these professions to drop. The consequences of lower numbers of people working in these areas can easily be seen. With fewer policemen to enforce the law, crime rates will rise. Policemen will be spread too thin. With fewer teachers around, the students will not learn as well. There will be more students in classes, and there will not be enough teachers for all of them. This will make it harder to have one on one learning moments. With fewer nurses around, hospitals will be more disorganized. Doctors will have to take on more responsibility, and thus be busier and harder to reach. The demand of doctors will be even greater, causing prices for health care to rise even more. The quality of health care will decrease and some people may not even be able to receive it at all. If there are fewer road workers, then it will take them longer to keep the city’s streets orderly and in working order. The quality of streets will begin to decrease, and the city will lose some of its beauty, making it a less desirable place. And finally with fewer workers in the water department, it will be harder to manage the community’s water and keep it in a clean and healthy state. As can be seen, these are vital services to the community and something needs to be done if we intend to keep them in proper order.
Some people believe that the higher property taxes will help these groups of people to afford the cost of living here. However, only part of the property taxes is used in the above fields, and they do not necessarily go towards the wages of the people who work in these fields. It would be helpful to these people if they did, though.
In conclusion, it is a good thing that more people are moving into the area, but it is a bad thing for the community that large numbers of the current residents may be forced to go somewhere else because of rapidly rising real estate prices. In order for both new people to come into the area and current residents to stay if they desire, a solution that would help the three categories of affected people is needed. Recruiting companies that can provide high paying jobs will benefit young people and middle class families. With these jobs, they could afford housing. Putting a cap on property taxes for the elderly will decrease their financial burden and allow them to live here. Finally, using money that has recently been brought into the community through higher property taxes, people who provide important services could receive wage increases. This would allow for them to afford housing as well. Helping these categories of people in these ways would allow the community to flourish, benefiting all of its residents.
Anderton, Dave. “Home Prices Soar.” Deseret Morning News 2 Sept. 2005: D12.
Englestead, Ron. Personal interview. 27 Sept. 2005.
Page, Scott. Personal interview. 27 Sept. 2005.
Ragona, Justin. Personal interview. 27 Sept. 2005.
Weaver, Jennifer. “Director: City Needs Housing Options.” Cedar City Daily News 30 Sept. 2005: A1, A10.