Could modular, factory-built homes help Utah’s housing crisis?

Stock image | Photo by © Viktor Kintop/iStock/Getty Images Plus, St. George News

Utah lawmakers are considering legislation to make it easier to build and sell modular houses — or homes that are built in factories in sections and then assembled on the lot — in hopes that it will pave the way for more houses to be built faster and at cheaper price points.

With the affordable building amendments bill, designated SB 168 in the 2024 state Legislature, Sen. Lincoln Fillmore, R-South Jordan, wants to set a statewide building code for modular homes and off-site construction — a wonky but important change that homebuilders believe could help increase their ability to more commonly build and sell these types of homes across Utah.

“Currently, Utah is one of less than 10 states that requires manufacturers like us to get approval from more than 240 cities and towns in order to sell our homes,” said Nicole Graham, representing a modular home builder ZenniHome that currently operates a factory just across the Utah-Arizona border in Page.

“This bill aligns with 40 other states who have streamlined the process to one location for approval at the state level,” Graham told the Senate Economic Development and Workforce Services Committee in the bill’s first legislative hearing Wednesday.

Graham said ZenniHome builds “beautiful, one-bedroom homes for $90,000 and beautiful two-bedroom homes for $120,000.”

In this file photo, residential construction is underway in a part of Washington County, Utah, circa 2023 | Photo by Aaron Crane, St. George News

“Please support this bill, particularly if you want more affordable housing options for yourself and for the people that you love,” she said.

Kam Valgardson, general manager at the Spanish Fork-based Irontown Modular, also spoke in favor of the bill. Today, Irontown’s factory builds modular homes for projects in and out of Utah — including states of Arizona, California, Colorado, Idaho, Montana, Nevada, Oregon and Wyoming.

Valgardson told Utah News Dispatch it’s currently more cost-effective to build entire subdivisions of modular homes than it is to build smaller, stand-alone projects. But if Utah were to set a statewide code for modular housing, that could streamline the approval process, increase demand and therefore help businesses like his scale their efforts to produce more homes and bring down their prices.

Fillmore, co-chair of the state’s Commission on Housing Affordability, negotiated SB168 as part of a trio of heavily negotiated bills drafted in partnership with a variety of housing industry partners, from home builders to city officials meant to tackle regulatory reforms to help lower housing costs.

Under the bill, modular housing projects would still be subject to approval under city zoning processes.

Cameron Diehl, executive director of the Utah League of Cities and Towns, said the league supports the legislation to “facilitate expansion” of the modular housing industry, “which we think will make a difference over time across the state” in bringing down the cost of housing.

“We think it’ll make a difference in being able to provide housing units in rural Utah where there’s a shortage of contractors or laborers or other aspects of the residential construction industry,” Diehl said. “But I also think it’ll make a difference to bring down the price of housing, in new construction around the urban areas as well.”

Lawmakers including Sen. Mike McKell, R-Spanish Fork, spoke in favor of the bill, noting Irontown Modular’s factory resides in his district.

“We’ve got a problem to solve,” he said, noting it will likely take a multi-year effort with many different partners to address Utah’s housing affordability crisis. “It’s all hands on deck.”

The Senate committee voted 5-0 on Wednesday to endorse the bill. It now goes to the full Utah Senate for consideration.

Written by KATIE MCKELLAR, Utah News Dispatch.

Utah News Dispatch is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Utah News Dispatch maintains editorial independence. Contact Editor McKenzie Romero for questions: [email protected]. Follow Utah News Dispatch on Facebook and Twitter.

Check out all of St. George News’ coverage of the 2024 Utah Legislature by clicking here.

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