Utah
may not spring to mind as a region Australian developers and planners should
study in more detail but I came away from speaking at an American Planning
Association conference there last month wondering why it doesn’t feature more
prominently in our thinking. It is more comparable and relevant to Australian
conditions than say Vancouver or Portland plus its economic and housing market
fundamentals present the sorts of metrics we aspire to.
Utah is one of the fastest growing
economies in the USA today. A recent
article by Forbes described it as the fourth fastest growing region in the
country at 6.93%. And it is tech and financial services driving that growth,
with companies like Goldman Sachs transplanting 2000 employees to the state and
countless other tech firms doing the same. It is a strong economy and it’s
attracting knowledge based industries at a rate that cities in in Australia
would be jealous of.
Its population growth is broadly double the
average for the USA and parts of the region are growing at close to 6% per
annum. A big attractant is the state’s low unemployment and very affordable
cost of living. Housing costs are said to be one tenth that of New York and a
fraction of what cities like Seattle, San Francisco, Portland, or Los Angeles
are commanding.
Centred around the capital Salt Lake City
are numerous regions and city authorities. Much like the our metro regions, there
are multiple jurisdictions each with their own planning controls and
development plans. Salt Lake City itself is home to only around 200,000 people
while the wider Salt Lake metro region is home to around 1.2 million people.
This in turn is part of a largely contiguous area that stretches some 200
kilometres from end to end, which is home to around 2.5 million people.
These numbers are reminiscent of south east
Queensland, and like south east Queensland the corridor of growth is largely
contained by water (plus a desert in Utah’s case) on one side, and mountains on
the other. It’s an elongated urban growth corridor for this reason.
Given then
its high growth, strong economy and low unemployment characteristics, combined
with broadly similar population numbers, how is it that the region has
maintained such affordable housing? The median house price across the Salt Lake
County region is a multiple of only around 4.2 times median household incomes. Sydney’s
housing is a multiple of 12 times median household incomes, Melbourne 9 and
Brisbane is 6 times median incomes.
The typical response of some commentators
in Australia is to dismiss US cities with excellent affordability as “places
where no one wants to live” but Utah and the Salt Lake region is growing fast –
faster than any Australian urban economy. So that excuse doesn’t cut it.
Talking to some of the Utah planners it
became clear that when they speak of increasing urban density, they’re having an
entirely different conversation to us in Australia. There are no urban growth
boundaries as such in Utah or the Salt Lake-Provo-Ogden-Wasatch area. They are promoting
higher densities of residential development but this is largely a voluntary thing
negotiated between developer and city planners. Some of those cities in the
region have minimum subdivision sizes of three acres. Yes, three acres. Others
promote higher densities but there is a strong cultural connection to the
single family (detached) house on a large(ish) block of land. It sounds much like
we were once - although the quarter acre block largely disappeared in Australia
in the 1970s. A quarter acre would be considered small by many in Utah.
Land is plentiful - for now - and planning
restrictions nowhere near as objectionable as they have become in Australia.
Land is taxed differently and leniently. Growth is a good thing, not an evil
that must be contained and brought to submission under the regulator’s rule
book. The one thing that left many of the people I spoke to in Utah speechless
was the idea that in Australia, the land can be worth more than the cost of
building the house. When I pointed out the average lot size was getting down to
around 400 to 500 square metres, the jaws dropped further.
However, there are some pioneers of housing
density in Utah that are setting high quality benchmarks and winning the
homebuyers over in large numbers. The master planned community of Daybreak (first
developed as an initiative of our own Rio Tinto) at South Jordan (roughly 20
minutes’ drive south of Salt Lake City) is one such project. Covering 4000
acres (1600 hectares) it will provide 20,000 dwellings for 50,000 people and
extensive retail and commercial space once complete. Connected to the region’s
rail (‘Trax’) network and serviced by extensive highway connections (got to
love the Americans for this) the masterplanned community puts impeccable
eco-credentials to work and has been widely and professionally recognized for
its innovation and leadership.
Designed along new urbanist lines by the
renowned Peter Calthorpe (among others) Daybreak exudes a charm that is
understandably attractive to young families and seniors alike. Over a quarter
of the site is devoted to open space but this is woven throughout the
neighborhoods in wide foot paths, pedestrian connections, shared common area
lawns and other natural features, some which serve to help retain 100% of storm
water on site.
House and land combinations here are priced
from around $400k to $500k (Australian), which is higher than the regional
median for Utah. Typical lot sizes for entry level three bedroom homes are
around 460 square metres, up to around 550 square metres for larger homes.
Attached town homes or town houses obviously are on smaller lots still (an
attached ‘twin home’ might be on less than 350m2). So Daybreak is proving that
smaller lot sizes and higher median prices are achievable, even in a region
known for its love of large housing lots and its antipathy forwards
multi-family housing (even townhouses are viewed with suspicion: our approach
to high density would be viewed with horror).
Daybreak are meeting a community demand for
quality neighbourhood environments and open space that is delivered in a
relatively high density format for detached living. They are not being told to
do this by regulators nor are they being forced to comply with some arbitrary
minimum number of lots to the acre. In fact, I’m told Daybreak’s ‘new urbanist’
design principles met with significant regulatory opposition in the early days
and there are still doubters in public policy circles.
The point is that the light regulatory
touch in Utah has not prevented innovation or world leading design in urban
development. While parts of the region pursue more traditional growth patterns,
others (especially in and around downtown Salt Lake City) are pursuing higher
density options while others still like Daybreak are successfully pursuing high
quality community building around small lots which run counter to convention.
The market is free to work, and consumers are free to choose. Prices are
competitive and supply is not artificially restrained. Affordability is
excellent by Australian standards and the economy powering ahead at rates of
growth that leave many Australian urban regions for dead.
Utah has a lot to offer as an example of a
less regulated land market with a strong and modern economy, substantial
population growth and affordable housing. Australian urban planners would do
well to expand their horizons and have a look for themselves at what can be
achieved with minimal intervention.
…………
For a gallery of some images of Daybreak with captions, please click here.
If you are interested, I can also put you
in touch with the lovely people from the American Planning Association, Utah
Chapter. The people at Daybreak have also told me they are happy to show
Australians around their project. Let me know and I will put you in touch with their
External Relations person.
The Daybreak development’s web page is here.
There are countless stories on the strong
economy and growth story of Utah. You can find them all here.
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