Along the Wasatch Front, population growth has outpaced housing for years. In Salt Lake City, that shows up as infill duplexes and ADUs on the west side and near downtown, and as spec homes across the valley's growing suburbs.
In short: LendingStreet finances ground-up construction in Salt Lake City and the Salt Lake Valley for investors building 1 to 8 units, including spec homes, duplexes, homes with ADUs and small 5-8 unit buildings. Loans are sized on loan-to-cost with terms set per project, and funds are released through inspected draws. Seismic design, winter scheduling and the specific city's zoning are what we look at first.
Inside the city, infill is concentrated in neighborhoods like Glendale, Rose Park, Poplar Grove, Ballpark, Central City and parts of Sugar House, where older small homes sit on lots that can take a second unit or a new duplex. Salt Lake City allows ADUs in many residential zones and has adopted incentives for some multi-unit projects.
In the suburbs, spec builders work in cities like South Jordan, Herriman, West Jordan, Riverton and Lehi to the south, where land and new subdivisions are available.
Salt Lake County cities have grown quickly, and impact fees, utility connection charges and road requirements vary from one city to the next. A spec home in Herriman and a spec home in Millcreek can have very different fee loads even at similar sale prices. Ask each city for a fee estimate and compare it with recent new-build sales before choosing where to build your next project.
Common project types in Salt Lake City and the valley: Each type has its own exit and its own local issues.
| Project type | Where it is common | Local note |
|---|---|---|
| Infill duplex | Glendale, Rose Park, Poplar Grove | Rental exit is common |
| Home plus ADU | Sugar House, Central City, 9th and 9th | Confirm ADU rules for the zone |
| Spec single-family | South Jordan, Herriman, Riverton | Sale exit; compare to builder pricing |
| Small 5-8 unit building | Ballpark, Central City | Larger permit scope |
In Salt Lake City, plans go through the city's building services and planning divisions. Each suburban city in the valley has its own zoning and permitting office, impact fees and timelines, so a South Jordan spec home and a Glendale duplex follow different rules.
Utah does not have a state real estate transfer tax, which keeps closing costs simpler than in many states. Title and recording fees still apply.
The Wasatch Fault runs along the east side of the valley, and Utah building codes require seismic design that affects foundations and framing. Some lots have shallow groundwater or soils that need engineering. Winter snow slows exterior work, so plan foundations and framing for the right season.
Construction loans are sized on loan-to-cost (LTC): the loan as a share of the total project budget, including land, hard costs, soft costs and contingency. Terms are set per project, so the percentage depends on the plans, the budget, the location and your experience.
The finished value matters too. A Salt Lake City budget that works on cost but leaves little margin against the expected sale price or appraised value will usually be sized down, because the exit has to work.
This example is illustrative and not a quote. An investor builds a duplex in Glendale and sells it on completion. Land costs $250,000, hard costs are $650,000, soft costs are $100,000 and the contingency is $40,000, for a total project cost of $1,040,000.
At a sample 80% loan-to-cost, the loan is $832,000 and the investor puts $208,000 into the project. Most of the loan funds through draws as work is completed.
If the finished property sells for $1,250,000 in total and selling costs run about 6%, or $75,000, net proceeds of $1,175,000 repay the $832,000 loan and leave $343,000 before interest and carrying costs, against $208,000 of cash invested.
| Item | Amount |
|---|---|
| Land | $250,000 |
| Hard construction costs | $650,000 |
| Soft costs (plans, engineering, permits, fees) | $100,000 |
| Contingency | $40,000 |
| Total project cost | $1,040,000 |
| Loan at a sample 80% LTC | $832,000 |
| Investor cash in the project | $208,000 |
| Sale price | $1,250,000 |
| Selling costs at about 6% | $75,000 |
| Left after repaying the loan, before interest and carry | $343,000 |
Each draw follows an inspection. When a stage is finished, you request funds, an inspector verifies the completed work and the money for that stage is released to keep the job moving.
A draw schedule that matches the real sequence of a Salt Lake City build avoids cash gaps. Front-loaded schedules and vague line items slow approvals, so tie each draw to work an inspector can see.
A complete package gets a faster, clearer answer. Lenders generally pass on projects without plans or permits, and on borrowers with no build track record and no experienced general contractor.
If you are newer to building, pairing with a general contractor who has finished similar Salt Lake City projects can make the difference. Their resume, licenses and recent projects become part of your file.
Every construction loan needs a clear exit. Spec builders sell the finished property. Build-to-rent investors lease it up and refinance into a DSCR loan that qualifies on the property's rent, with no W-2s or tax returns, a 620 minimum credit score, LLC borrowers standard and 30-year terms available.
If a sale takes longer than planned, a leased property can still refinance into a DSCR loan, so it helps to design a home that would also rent well in Salt Lake City.
Our investor loans are business-purpose loans on non-owner-occupied property. Send your Salt Lake City plans, budget and land details through the form below, or call (877) 298-1001, and we will come back with how the project can be sized.
Salt Lake City allows ADUs in many residential zones, but the rules vary by zone. Confirm with the city before you buy the lot or design the project.
Utah does not have a state real estate transfer tax. You will still pay title, recording and lender closing costs.
Yes. We finance investor spec homes across the Salt Lake Valley, subject to plans, permits, a realistic budget and builder experience.
It can affect foundations, framing and connections. Your engineer's plans should include it, and those costs belong in the budget from the start.
No. Our investor loans are business-purpose loans on non-owner-occupied property.
In most cases, yes, or approved plans with a clear path to permit. Projects without plans or permits usually do not qualify.
Through a draw schedule. Each stage of work is inspected before funds for that stage are released.
Yes. Once the property is leased, a DSCR loan can pay off the construction loan, qualifying on rent with 30-year terms available.
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