Making strides on affordability

Today’s DJC has a good story by Patrick L. Phillips of the ULI about housing affordability, particularly the importance of housing near jobs for people with moderate incomes. This needs to be a priority for Seattle, not because everyone is automatically entitled to live in their favorite neighborhood, but for limiting stress on our transportation system, giving low-wage workers an easier route up the ladder (minus the absurd commute), invigorating neighborhoods, and essentially making the city function for people and as an economic engine.

Terrazza aPodment (rendering courtesy of Kauri Investments)

Thankfully Seattle is doing a lot of things well.

Voters keep approving housing levies.  In 2009 we passed a $145,000,000, seven-year measure, which averages over $20,000,000 per year, most of which goes to rental construction and preservation. This is big reason Seattle always has low-income units under construction. A host of outstanding non-profits, such as LIHI and Plymouth Housing Group,  do an excellent job building and owning housing that both helps people and improves neighborhoods.

Seattle’s reduced/zero parking requirements for new housing are a big reason behind our current housing boom. The economics of 200 one-bedroom homes are much easier with a 0.6 parking ratio vs. a 1.0 or 1.2. The units that get built are cheaper, and more units are getting built, helping keep housing supply/demand in check.

We allow smaller units than most cities. New York and San Francisco have been wringing their hands about allowing 220 square foot units. Seattle already allows much smaller units than that, both with traditional apartments and in rooming houses. These are proliferating on Capitol Hill, in the U District, etc. What a phenomenal idea…the private market providing workforce housing without subsidy! Of course having little or no parking is a necessary precondition for these units.

Most importantly, we’re letting housing get built in sizeable numbers. Our biggest affordability weapon is to avoid undersupply, the bane of the most expensive cities. With decent supply, everyone avoids the worst price war scenario, and the less desirable units tend to be substantially cheaper. This is why the average building from 1920 or 1970 is relatively affordable today. Increasingly, units from 1988 play that role, and someday units from 2013 will as well.

Unfortunately we’re moving backwards in other ways. We’re attaching more bonus fees to taller buildings in some areas. This is counterproductive because it disincentivizes supply, and also makes the units in these building more expensive. (Disclosure: I work for a contractor that builds highrises.) We’re putting the burden on a relatively small number of residents and developers, apparently a politically expedient way to avoid paying it ourselves. It would be better to expand the levy.

And of course we need transit. Seattle is doing moderately ok, but clouds are on the horizon for big cutbacks to Metro.

So, while more needs to be done, we can pat ourselves on the back for doing some good things.