Seattle Advisory Committee to Study Affordable Housing

Hat tip to the West Seattle Blog, who yesterday posted about a City of Seattle advisory committee on affordable housing. The city is gearing up to attempt to “develop a bold agenda for increasing the affordability and availability of housing in our city by convening a Housing Affordability and Livability Advisory Committee.“

Here are some of their starting assumptions:

p. 6 – Existing housing does not meet the needs of many current residents. Households are increasingly burdened by their housing costs.

p. 10 – The gap between demand and availability of affordable housing is greatest for lower income households, including family-sized households. Workers in some of the city’s most common occupations are priced out of living in Seattle.

p. 15 – In a growing City, new housing supply is necessary but not sufficient to achieve affordability.

The claim that new housing supply alone is not sufficient to achieve affordability is based on data that shows that (unsurprisingly) typical new housing stock rents and sells for considerably more than existing homes.

I would argue that new supply could be sufficient to achieve affordability if there were enough new supply. The city is predicting that 70,000 new housing units will be built in the next 20 years. Imagine if the city adjusted zoning, permitting, and incentives such that 700,000 new housing units came on the market instead. There is no way that would not drive prices down dramatically.

I’m not saying that’s the best solution, but it definitely seems like something that could work.

You can give your own input in three upcoming evening meetings (6:00 PM – 8:30 PM):

Here’s their full slide deck.

Thanks to reader Shane for pointing me to WSB’s post.

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

31 comments:

  1. 1
    Mike says:

    There are plenty of options. Most of them have one theme in common: Make the area unappealing to the people who are currently paying high prices. This is a ‘free’ option and only requires cutting police and school budgets. Some of the savings could be used to fund bus tickets to Seattle for all people being released from state and federal prisons across the country. Follow these simple steps and affordable housing will be abundant.

    All you need to do is look at the areas withing the city where housing is currently affordable to see the solution. Crime, public housing, half way houses, drugs and prostitution and lack of upscale amenities – basically anything that scares out yuppies or makes their lives less enjoyable will lead to more affordable housing. Let’s start with replacing all of the Whole Foods and PCC’s with either Grocery Outlets or bodegas selling all pre-packaged food. Nobody feels sorry for those folks, they have their jobs and money, they can deal with the problems on their own.

  2. 2
    Brandon Adams says:

    If a dramatic increase in supply isn’t an option, maybe they could work the demand side. Start a disinformation campaign to discourage people from moving here.

    Did you know that it rains all year, even in the summer? Scientists blame Mt. Rainier, which is probably going to explode within the next six months.

  3. 3
    Deerhawke says:

    It is interesting that this set of meetings is well-known in the affordable housing community (read: subsidized housing community) but no-one from the city has reached out to market-rate developers and builders to let them know about it.

    Why? Because regular builders are being demonized by the city council as ethically compromised individuals who need to be taxed (and taxed heavily) in order to fund subsidies for affordable housing.

    Mike O’Brian has proposed a “linkage fee” that he claims
    1) will only impact developers and builders
    2) will not be passed on to consumers and so…
    3) will lead only to decreased builder profits without any rise in rents or housing costs for everyone else.

    It is being sold as a Robin Hood fee. Rob from the rich money-grubbing builders and give to the deserving poor with no collateral damage for the rest of us.

    One can go on and on about how this flies in the face of basic economics, but lets just keep this simple. If you want more of something you should incentivize it, not punish it. If you want more affordable housing, taxing new market-rate housing is hardly a rational solution to the problem. In fact, it is going 180 degrees in the wrong direction.

    Tim, your idea of seeing how we can get more housing supply is blessed by simplicity and basic economic common sense. I hope you stay out in front on this.

  4. 4
    wreckingbull says:

    I propose a network of human-size vacuum tubes so Seattle residents can import people to fix their cars, re-roof their homes, teach their children, cook their food, and extinguish their fires.

    At 4:55 PM, an alarm will sound city wide and the unwashed masses must find a free canister and be sucked off to the dirty suburbs with a soothing whoosh.

    Problem solved.

  5. 5
    Blurtman says:

    RE: wreckingbull @ 4 – Lack of compliance will not be treated lightly.

    http://www.badmovies.org/movies/boyanddog/boyanddog8.jpg

  6. 6
    whatsmyname says:

    RE: wreckingbull @ 4 – I will give you credit for uncomfortable and expensive, but this idea fails the Seattle requirement that no new transit system may efficiently cover more than a 3 mile stretch, except to go sort of near the airport.

    Fortunately the city is way ahead of you. At the current rate of gridlock expansion, Metro busses will soon reach outlying park and rides approximately one hour before departure is needed for return to work. With no practical ability to drive home and back, workers can eliminate car ownership (another city goal), freeing up car park space for lockers and showers. Marginally paid workers can, in effect, live on the bus. Certainly this added service and the elimination of rent and car payments would justify very large fare increases. Everyone wins.

  7. 7
    Huck says:

    *sigh* maybe instead of adding more policies against houseboats (especially the small apartment-sized ones), we can start using some of that wasted waterfront all around lake washington.

  8. 8
    boater says:

    Someone needs to point them to San Francisco so they can see what happens when you don’t go with massive supply increase and instead choose poor housing subsidies. You get a really bipolar city with no middle class.

  9. 9

    Housing Planning and Demographic Science Had a Chance in the Seattle Area About 1970, Earthday BTW

    The new foreign lobbyists that now pick our candidates from both parties [even local elections] have shut the talk up about “overpopulation” and scarce infrastructure to service the community. They now call it racism….LOL. It used to be called Democrat liberalism.

  10. 10

    RE: Brandon Adams @ 2RE: Deerhawke @ 3

    Interesting Opinion Deerhawk

    What’s missing is a few actual examples of your allegation that no controls be put on city zoning and planning when it comes to developers; and its good for us [or only them?]?

    And to Brandon:

    They don’t need to lie to convince moving in an over-priced Seattle downtown apartment/condo with no parking or available grocery stores is a good thing….most folks with a brain already know it.

  11. 11

    RE: boater @ 8

    San Francisco Thinks Turning This Country Into Another Overpopulated Japan is Cute

    Then they retire and move the hades out.

  12. 12
    Deerhawke says:

    Clearly, I am not saying that there should be no controls on development. It is in everyone’s interest to have buildings built to a certain set of standards, otherwise you will have people putting up uninsulated T-111 boxes with single pane windows and electric baseboard heat like in the early 70’s.

    But it is a little crazy when you want to build a simple 8-unit apartment building and you face 2 years of permitting (mostly just waiting) to get through neighborhood design review and appeals. The process for an 8 unit apartment building is no different than for a 60-story building being built by Vulcan or Amazon.

    As a result, we end up with a lot of the low-rise land being used for a few townhouses rather than a lot more apartments, condos and retail. I have a small piece of land on Capitol Hill. It would be perfect for a 12 unit apartment building. Instead I am building 3 townhouses. Permits in 4 months or in two years– easy choice.

  13. 13
    john says:

    fixing housing is as easy as pi.

    The thing is vested interests are far too strong for any real fixes to even be considered. for anyone who does not know, the greater seattle area has vast amounts of land that could be opened for development and built up within a few short years.
    The only valid argument against it , is protecting the asset base of existing property owners . This issue has been dealt with repeatedly across the globe, the solutions are clear , straight forward and require only the willingness to carry them out.

    As for me the status quo is fine, and I am not at all concerned that anyone in any electable position of government would be interested in resolving housing costs in and around the greater seattle area.

  14. 14
    murrcat says:

    Part of the supply problem is in the SF zones. The density in these zones, which take up 2/3 of the land area in Seattle, is suburban, not urban. SF zones should be allowed to have duplexes and triplexes, which could be converted from existing houses, and also should be allowed to have smaller short plats–2500 or 3000 square feet. This is an easy way to create more housing variety and quantity.

  15. 15
    Weasel says:

    Maybe it takes a fresh set of eyes to see this? We’re totally new to Seattle..

    Our family/work/kids situation with out going into boring details affords a house under 230k, and work is on 2nd Ave close to link and 10 mins from King Street station.

    What I take away from this little house buying + transit research exercise – Seattle’s transit needs massive improvement. Faster ferries to places such as Port Orchard and Southworth would open up some new areas. Express trains to the more southern stops like Auburn, Sumner and Puyallup and more buses timed with the trains. Forget busses for anything but shorter trips, they just get stuck in gnarly traffic, people at work who use the bus system are often late.

    Ended up buying a house in Puyallup, further than I’d like, but a decent house on a nice street, I can stand in my back yard and NOT see into 3 adjacent houses. Total commute time just over 1hr via short bus ride, Sounder and a 10 min walk up 2nd street. When I get bored of that I can probably find a half decent job in Tacoma.

  16. 16

    RE: Deerhawke @ 12

    The failings of Design Review process – i.e. the delay – is the incompetency of DPD to effectively manage the program. There is no reason that there couldn’t be more boards and shorter wait times.

  17. 17

    “I would argue that new supply could be sufficient to achieve affordability if there were enough new supply. The city is predicting that 70,000 new housing units will be built in the next 20 years. Imagine if the city adjusted zoning, permitting, and incentives such that 700,000 new housing units came on the market instead. There is no way that would not drive prices down dramatically”

    Just how would this work outside of a pipe dream?

    Which banks, investors and developers would contribute to a housing stock that arguably have to be unoccupied in order to have the net effect of reducing rents.

    Are you suggesting that “the market” would itself create housing supply conditions emulating an economic collapse where there is no demand for housing they produce?

  18. 18
    Mike says:

    RE: john @ 13 – This is another good strategy. Make the housing so inaccessible hardly anyone is willing to live there. It’s the ‘rural’ correlary to making the urban areas crime infested. Blow out the urban growth boundary, but allow nothing but dirt roads and limited utilities, no commercial zoning for so much as a gas station and or convenience store. The houses will be dirt cheap and uber affordable as a result!

  19. 19
    Mike says:

    RE: john @ 13 – This is another good strategy. Make the housing so inaccessible hardly anyone is willing to live there. It’s the ‘rural’ correlary to making the urban areas crime infested. Blow out the urban growth boundary, but allow nothing but dirt roads and limited utilities, no commercial zoning for so much as a gas station and or convenience store. The houses will be dirt cheap and uber affordable as a result!

    RE: Weasel @ 15 – Ehhh… you can pay for it. It’s ridiculous that we have dense city neighborhoods like Ballard already in existence, with no transportation infrastructure, yet people are arguing to run mass transit to places like Puyallup and Lynnwood. That’s insane. Those areas have nowhere near the density to pay for and operate a transit system, and if current growth is any indication they never will. Any lines we run out into the hinterlands are just going to end up as feeders for even more remote communities. Folks who insist on having the big back yard will say “hey, if I plan my commute around a 45 minute drive to the train station, and a 45 minute train ride, I can get an even bigger house, with a bigger yard for even less money!” Meanwhile, everyone’s commute will continue to deteriorate. Plenty of metro areas have already gone that route and seen it fail. Seattle, having little infrastructure besides an outdated freeway system is at a point where we could decide not to repeat that mistake. Hopefully the Seattle city Metro vote last week is the first step in breaking the county, and tri-county transit boondoggle. Seattle needs to handle their transit separately from the county. Trying to accommodate the rural cheapskates that feel they deserve an inexpensive house with a big yard AND an easy commute paid for by “the taxpayers” is a losing proposition. Big houses, big yards are a luxury. People who want that and a short commute need to be the ones ponying up the money for the transit. There should be no ‘loophole’ for people buying cheap low tax basis houses so they can stick the transit costs on everyone else.

  20. 20
    Matt the Engineer says:

    First, I haven’t been here in weeks and come back to a new site style, a post of one of my favorite topics, and I agree with half the comments. Very nice surprise.

    Second, my responses:

    RE: Mike @ 1 – There are exactly two ways to make housing more affordable: increase supply or decrease demand. I see you’ve gone for the second option. I prefer the first.

    RE: bill bradburd @ 17 – Tim’s numbers are a little extreme, but surely you agree there’s *some* number of additional supply the market would create through adjusted zoning, permitting, and incentives. The closer we come to matching the massive increase in jobs with a corresponding number of homes, the less housing prices rise. The market, if allowed, can take care of a very large portion of that. The rest we add using a general property tax (income tax would be ideal but not legal, development tax would be counter-productive and slow development).

  21. 21
    wreckingbull says:

    I say it every time this comes up. So many of these problems are descended from this arcane notion that we all need to work 8-5 in little cubbies together in an expensive urban office building. It’s stupid.

    I worked for a company that realized how ridiculous this is. We were able to attract talent by letting people live wherever they wanted and allowing flexible working conditions, whether that flexibility be temporal or geographic or a combination or both.

    Yes, not all work can be done this way. I get it. But most of the jobs that are causing this explosive growth today can be.

  22. 22
    Matt the Engineer says:

    RE: wreckingbull @ 21 – And who, exactly, is forcing companies to locate downtown? I think you misunderstand both the network benefits of a strong central city and the benefits to employees. Let me just list a few:

    1. Face-to-face meetings between teams in different companies. When I’ve worked downtown I spent far more time face-to-face coordinating, selling, socializing, and collaborating than I ever did in the suburbs. There is real value to this that you don’t get over the phone.

    2. Access to amenities. Whether it’s a 5 minute walk to 100 lunch spots, nightlife, sporting events, or the arts people tend to like to work in cities because of what’s available to them. If people want to work there, in a tight labor market it makes sense for companies to accommodate this.

    3. Transit. Seattle has a hub-and-spoke transit model, which is one of the few efficient systems and the reason we have reasonably good transit. With the suburbs you’re limited to a network model, with means terrible or non-existent transit systems. This also means a vast network of road space is required, which drives up first cost, maintenance costs, and is highly space inefficient and therefore takes much more land. You then also have to provide vast parking lots at offices, shopping, schools, churches, etc. You also end up spending a vast about of personal time and money commuting not only to work but everywhere else.

    4. If instead of the suburbs you’re talking about working from home I’ll have to ask you if you’ve tried it. It may work for some, but I personally prefer human interaction. My personal hell isn’t a cubicle (I prefer one over a private office – more human interaction), but being stuck at home.

  23. 23
    Erik says:

    RE: Matt the Engineer @ 22
    Wreckingbull has 2 best friends. One’s name is Dell and the other has the initials HP. Wreckingbull gets all the social interaction he needs with his 2 best friends.

  24. 24

    Tim wrote: “Imagine if the city adjusted zoning, permitting, and incentives such that 700,000 new housing units came on the market instead. There is no way that would not drive prices down dramatically.”

    There is also no way anything the City of Seattle tries to do would in any way be based on the slightest understanding of economics. pfft donating money to the Republican party would be more likely.

    But it is possible their $15 minimum wage could help. As low paying jobs move out of Seattle there could be less demand for housing, making it more affordable.

  25. 25
    ChrisM says:

    I tried replying to this yesterday, but apparently it got lost. So here’s the second attempt… I think Portland might be a bit ahead of Seattle, and the signs are not good. Wealthy people are unhappy about high density housing showing up in their historic well-maintained neighborhoods. And it appears no one really wants high density housing:
    http://www.oregonlive.com/front-porch/index.ssf/2014/09/how_do_portlanders_want_to_liv.html
    http://www.oregonlive.com/portland/index.ssf/2014/11/metro_measure_keeping_regional.html

    Whilst Googling (yes, that is a verb) this post, I found this:
    http://seattletimes.com/pacificnw/2003/0202/cover.html

    which is laughable for the Homer Williams quotes, assuming you have the gumption to research who he is:
    http://www.wweek.com/portland/article-2307-homers_odyssey.html

  26. 26
    wreckingbull says:

    RE: Matt the Engineer @ 22 – My post never mentioned the suburbs, so let’s steer away from the city vs. suburbs war that always seems to pop up here. I also never advocated locking oneself away from humanity. I don’t know where this notion comes from that one must live in the city to have access to culture. It’s rather daft.

    What I am saying is that we all get in our car/bus at exactly the same time each day, head into work, and them repeat the same thing in the evening. It is no wonder we can’t ever keep up with our transportation needs and things get worse each year. More flexible working conditions are needed, and must be part of the solution.

    As far as Seattle having a reasonably good transportation system, certainly that is your opinion, but I think we need to raise the bar a bit. It’s pretty bad, and yes that does come from years of using it.

  27. 27

    RE: wreckingbull @ 26 – I’m surprised reversible lanes are not more common, like the express lanes in North Seattle. When you look at the eastside every afternoon, there’s plenty of capacity getting into Bellevue, but not enough getting out. If you could steal a lane or two from the into Bellevue direction, things would be much better getting out, but still acceptable getting into the city.

  28. 28
    Matt the Engineer says:

    By wreckingbull @ 26:

    RE: Matt the Engineer @ 22 – As far as Seattle having a reasonably good transportation system, certainly that is your opinion, but I think we need to raise the bar a bit. It’s pretty bad, and yes that does come from years of using it.

    Here’s a chart from 2008, before we even had light rail. Notice all of the cities to the right of us have well developed rail-based mass transit systems. For a bus-based system we do pretty well. This will only improve as we add real mass transit.

  29. 29
    Deerhawke says:

    Really interesting article in the Seattle Times this morning. The paper reports that the State gave a nonprofit $9.7 million to create affordable housing. Mercy Housing Northwest is taking the old brick barracks in Magnuson Park and creating 128 affordable units.

    But the more you look at the numbers the less sense it makes. “The project is expected to cost about $60 million by the time it is completed. ”

    So basically it comes to this. Free land. Free buildings. Rehab them with a grant of $60 million and you create 128 subsidized housing units. I am going to guess that the land and the building would be worth an additional $10 million if sold on the open market given a prime location and water views. I think that is probably low, but lets use that number for now.

    So $70 million divided by 128 gives us a cost to the taxpayers of $546, 875 per unit. Not for a house, but for an apartment.

    That is affordable housing? Affordable for whom?

  30. 30

    RE: Deerhawke @ 29 – Good catch, but I wonder if the bulk of the $60M is for environmental cleanup, probably being paid for by the feds, regardless of what happens to the land.

    If not, it makes zero sense.

  31. 31
    Anonymous Coward says:

    Deerhawke @29,
    yes, selling the facility would probably make more economic sense. But this way, the “well-connected” will have a wonderful place for their low income relatives to live. You don’t think they’re going to let grandma live in a low income senior housing development in Skyway do you?

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