Rental Suites Now Available to Help Buyers in a Tough Market

Rental Suites Now Available to Help Buyers in a Tough Market

At a time of high mortgage rates and still high prices, one Utah home builder is trying something new to attract buyers – and potentially help them more easily qualify for a mortgage.

Fieldstone Homes, based in Draper, has just launched new options in several communities for buyers to add accessory dwelling units to their homes – basically, a basement apartment.

The builder is already currently offering free finished basements, said vice president of marketing Kellie Little. For a little extra, she said, buyers can expand that to a full apartment that they can rent out for extra income.

“You get a walkout basement, you have a kitchen, and you have a full living quarter that’s separate from the primary residence,” Little told KUTV 2News.

The options are available in Fieldstone communities in Clearfield, Eagle Mountain, and Saratoga Springs, but Little said more areas may open up in the future.

Little said this option can be helpful for buyers at a time when mortgage rates are higher.

“They can use income to help qualify for a loan,” she said, “and so that helps increase their buying power.”

It's also a benefit for Fieldstone to try to attract and retain buyers in a market that has slowed dramatically due to higher interest rates. As KUTV 2News has previously reported, many builders have been offering various incentives to try to lure buyers.

The Utah Legislature two years ago loosened the rules on accessory dwelling units – sometimes referred to as ADUs – making it harder for cities to say no to them.

Rep. Ray Ward (R-Bountiful), the sponsor of that bill, called Fieldstone’s new initiative “fantastic.”

“That is the kind of thing I hoped would happen,” Ward said, who added that ADUs tend to be more affordable units for renters.

The four-term lawmaker, who was recently re-elected to another term in the House of Representatives, said he doesn’t have a bill this session dealing with ADUs. But he believes the conversation about homeowners renting out part of their homes is far from over.

“Even if they don’t want to rent their home out right now,” said Ward, “they realize, gosh, my kids are teenagers now, I might want to rent it out in five years. I might want to rent it out to my kids in five years. I’d really just rather have the home built so that I could do that.”

Dejan Eskic, senior research fellow at the Kem C. Gardner Policy Institute who studies Utah’s housing market, said interest in ADUs is rising because of the potential for homeowners to earn extra income, thereby lowering their housing costs.

“There are still barriers from financing to costs to local code that makes ADUs relatively difficult to build at the moment,” said Eskic, “but we are making progress.”

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