SALT LAKE CITY — Two measures to make it easier for first-time homebuyers to enter the housing market passed the Utah Legislature Wednesday, and are on their way to Governor Spencer Cox’s desk.
The Utah Senate tacked on an amendment to HB 572, which makes it easier for small banks to participate in the Utah Homes Investment Program.
On a vote of 22-to-1, with 6 absent, HB572 went back to the Utah House. The measure makes use of State surplus money to reduce the developers’ costs to borrow money to build starter homes.
Developers taking part in the program would have to commit to having 60% of the homes built with program funds be starter homes, defined as 1,400 square feet and about $350,000.
The Utah Homes Investment Program originally called for the State to provide 80% of the money for the program and the banks to provide 20%, but State Senator Curtis Bramble attached an amendment that has the State providing 100% of the funds for the programs, so smaller banks could participate.
Bramble's concern was that smaller banks would have to borrow money to participate in the program but couldn’t do so at an interest rate lower than what the State will make money available.
Thus, having to actually pay money to be part of the program. With the successful passage of the amendment, HB572 went back to the House, where the amendment was accepted.
The bill now goes to the Governor’s desk.
Also passing the Legislature Wednesday was HB13, which creates Infrastructure Financing Districts, which will provide lower interest loans through publicly issued bonds, to help developers put in streets, curb and gutter, sewer, and other infrastructure.
The bond money would be less expensive than commercial loans.
Steve Waldrip, Senior Advisor to Governor Spencer Cox on Housing Strategy and Innovation says both bills are a great first step to helping first-time homebuyers get into the housing market.
"No one has ever tried it before. We think we've got it right. We'll see. We have great partners in our in our banks, our credit unions and our builders. They're committed to making it work. Our cities are committed to doing their part. We think we've got the right formula. We're pretty optimistic about the opportunity," he said.
The Governor is expected to sign both HB572 and HB13.
