This is an archived article that was published on in 2008, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Planners predicted it, but not this way - not this fast. Yet new urbanism - punctuated by a rush on downtown Salt Lake City - is sweeping a swath of northern Utah, a place long defined by suburban flight.

A new report reveals residential building permits in the south-valley boomtowns plunged 80 percent since last year. By contrast, the capital saw permits skyrocket to 194 this year from 13 in the first quarter of 2007.

Industry insiders say surging gasoline prices, a sagging economy and energy-policy uncertainty due to the presidential chase have combined to create the latest condo spurt. And it's no coincidence the new league of lofts are located near TRAX light-rail lines.

"People are more interested in moving into the city center rather than moving to the suburbs," said Jeff Hatch, Salt Lake County's auditor, who still is chewing on the economics of the sudden shift. "We'll see some smart growth happening because people are concerned about their pocketbook."

To be sure, stucco McMansions, three-car garages and powerboat parking strips will never go extinct. But $4 gas and the mortgage meltdown seem to be driving people to the city's smaller dwellings in droves - even in class-conscious Utah.

The report, from the Bureau of Economic and Business Research at the University of Utah, compared numbers from first quarter 2007 with first quarter 2008. It also showed permits in unincorporated Salt Lake County dove to 570 from 1,192.

Cities scrounge for cash: To offset the economic hit, suburban city councils in West Jordan and Riverton will hike property taxes. Riverton alone is proposing a 200 percent spike after building permits plummeted in the last year to just 100 from 1,000.

Bluffdale barely escaped a property tax bump. Draper was saved by sales tax, mostly from IKEA. But Saratoga Springs, in Utah County, has seen building-permit revenues retreat more than $1 million in the past year.

One anomaly is Sandy, which saw permits double to 62 from 31 over the same period. But part of that reflects a new condo project between Jordan High School and the end of the TRAX line, designed as a so-called transit-oriented development.

Eric Allen, a real estate and market-research consultant for Metrostudy, said the negative numbers may be inflated because several cities raised impact fees, prompting builders to pull their permits. He notes 25 percent of suburban buyers fell prey to the subprime crisis, while another 20 percent of housing starts came from investors who have disappeared.

"That right there takes us down 50 percent," Allen said.

Tack on slouching consumer confidence and the pivotal presidential election, and people are afraid to buy, according to Allen.

Still, even if you subtract the condo towers planned at City Creek Center, Allen acknowledges, a "more urban lifestyle is taking form here."

"A lot of the younger generation and the people who have moved here from out of state are used to that type of thing," he said. "They live and they work downtown or along the TRAX line."

TRAX spine gets lofty: Open-plan lofts and energy-efficient condos are sprouting along the TRAX spine on the fringe of downtown. There is the funky Angelina's Corner on the curve of 700 South and 200 West and ultra-green Rowhaus just north of the baseball park on West Temple, and there are hundreds of units planned at Market Station, a walkable development slated for the warehouse district in South Salt Lake.

"The really big suburban growth that we had been experiencing really dried up," Hatch adds. "From a community-development standpoint, it's pretty exciting - if it holds."

Legions of lofts also are near completion from the Main Library area to the streets surrounding Pioneer Park.

But James Wood, director of the U.'s research bureau, cautions that any trend requires more time than a single quarter-to-quarter comparison.

"It's way too early to make any conclusions," Wood said. "The amount of housing downtown is just a fraction. It's a niche market."

The rule of thumb, Wood notes, is that 1 percent of any metro area will live in the central business district. Branching out to include Davis and Summit counties, that equation still leaves room for just 5,000 additional downtown dwellers.

Plus, Wood said, loft prices are prohibitive.

"You'll be lucky to pay less than $250 a square foot, and not too many people can afford that."

Wood welcomes the focus on transit-oriented development - "there are people with that preference" - but says overall, residents must be convinced energy prices will be a long-term problem before making such a lifestyle change.

"It doesn't have anything to do at this point with gasoline prices or an interest in moving downtown in my view," Wood says. "Once the recovery comes, for better or worse, we're going to have more urban sprawl."

Busting the suburban boom?

* New building permits in West Jordan, Riverton and Draper down 80 percent since early 2007.

* Residential permits slashed in half in unincorporated Salt Lake County.

* Salt Lake City permits soared over the same period to 194 from 13. Despite downtown's boom, just 1 percent of the metro-area population lives in the central business district.