For those that continue to insist that home prices around Seattle are high because “supply isn’t keeping up with demand,” I would like to point out the 2007 King County Buildable Lands Report.
This is what the report has to say about building activity in King County from 2001 through 2005:
- King County gained more than 49,000 net new housing units in the UGA during the second five-year Buildable Lands review period (2001-2005). Accounting for assumed vacancy rates, this translates into about 47,300 net new households in Urban-designated King County, which is about 31% of the 22-year Household Growth Target added in 23% of the planning period. This growth occurred despite an economic recession and significant job loss during four of the five years of the analysis period.
- During the six years from the April 2000 US Census to April 2006, Washington State’s Office of Financial Management (OFM) estimates that King County’s population grew by 98,300 persons, from 1,737,000 to 1,835,300. This increase is nearly 32% of the 2002 OFM population projection for the planning period (2001-2022), which is the basis for the Household Growth Targets, during six years or 27% of the planning period.
– Chapter IV, p. 1
Quick calculation… 98,300 people in six years is roughly 82,000 people in five years, which translates to approximately 35,650 households (assuming an average of 2.3 persons per household—2000 Census showed 2.39). 35,650 new households (county-wide) vs. 49,000 new housing units (UGA-only). Whoops. Looks like supply has actually been easily exceeding demand, just like I said it was.
Going forward, the picture looks much the same:
- The King County UGA has capacity, based on current plans, for approximately 289,000 additional housing units accommodating an estimated 277,000 additional households—more than twice the capacity needed to accommodate the Household Growth Target of about 106,000 for the remainder of the 2000-2022 planning period.
- At projected household sizes, the 289,000 new housing units, together with the existing housing stock in 2006, could accommodate more than 400,000 additional persons within the UGA. This is more than twice the population growth needed to meet the remaining part of the 2002 OFM projection of 2,048,000 total population for King County in 2022.
– Chapter V, p. 3
Translation: the Growth Management Act and Urban Growth Boundary have not and will not result in an artificially-constrained supply of houses in King County for the foreseeable future.
Here’s a little blurb from the P-I (which is about all I expect to see, since the facts in this report don’t back up the oft-repeated “constrained supply” claim the papers love to tout):
According to the report, King County cities and towns grew slightly faster than projected from 2001 through 2005 and still had enough capacity for twice as many households as remain in the projection for growth through 2022.
In fact — thanks to rezoning, denser construction and increasing potential for redevelopment — there was more capacity at the end of the five years, despite development of 5,000 acres during that time.
Can we please stop claiming that “restricted supply” will prop up local housing prices now? I can write articles all day long about how beautiful the pretty pink sky is, but that doesn’t and won’t make it true. It just makes me annoying and ignorant.
(P-I Staff, Seattle P-I, 09.20.2007)