Seattle’s housing crunch could be eased by changes to single-family zoning, city report says

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The single-family zoning that dominates Seattle has priced people who aren’t rich out of most of the city’s neighborhoods, is contributing to income and racial inequality, and has forced the city’s booming population to crowd into small pockets of the city, a new planning-commission analysis concludes.

The advisory report released Monday stops short of recommending major citywide density but advocates for some mild changes that could affect districts that are mostly detached houses now. For instance, it asks for more duplexes near schools, expanding the boundaries of urban villages by a few blocks and reducing lot sizes to squeeze more homes into streets.

Like most cities, Seattle sets zoning rules that outline what can be built in different areas — from skyscrapers downtown and in South Lake Union to suburban-style homes with driveways in Magnolia and Crown Hill.

Facing historic population and housing-cost growth, the city has allowed taller buildings and more housing in some of its dense neighborhoods near transit — think central Ballard or the Junction in West Seattle.

But it’s kept single-family neighborhoods almost entirely unchanged: Residents in those areas dominate the electorate and many have been fiercely protective of keeping their neighborhoods the same, making any proposed changes there radioactive.

Now, the planning commission’s report, a year-and-a-half in the making, is the first effort from City Hall in years to tackle the single-family zoning issue here. Cities from Minneapolis to Portland to Vancouver, B.C., are moving to allow denser housing like duplexes in single-family areas.

Among the findings of the report:

• Single-family neighborhoods mostly accommodate high-income and white residents.

As the median cost of a house has soared to $750,000, “making homeownership impossible for those with modest incomes,” single-family homeowners make more than twice as much as those living in other types of housing. The household income gap between renters and homeowners has grown from $43,000 a decade ago to $65,000 now. Only one-third of single-family-zone dwellers make below the city’s median income (compared to two-thirds of people living in the rest of the city) and the disparity could widen as soaring property taxes push poorer homeowners to sell.

About half of white residents in Seattle own homes — while just one-fourth of black and Hispanic residents do. The commission argues a big part of the disparity is due to redlining and racial covenants, which decades ago prevented nonwhites from living in some desirable single-family zones, making it impossible for families of color to pass homes down through generations. Current zoning “perpetuates that legacy” by allowing only expensive housing there.

  • Growth in the city has been highly unequal because of zoning. Of Seattle’s 135 Census tracts, 31 have actually lost population since 1970 despite the city adding 180,000 people in that time frame. Almost all of the areas that lost residents were in single-family neighborhoods, often in upper-income areas close to the water where housing has not been added. For instance,the Madrona Beach (median home: $1.1 million) and Seward Park ($880,000) areas each lost about 750 residents.

Altogether, single-family zones that make up the vast majority of the city’s residential land have accommodated just 5 percent of new housing units built this decade,

• Land use is unequal, as well. Although prior analysis has pegged single-family homes as making up about two-thirds of the city’s residential land, the report says 75 percent of land available for housing is reserved for single-family lots. When looking at all land in the city — including parks, streets, schools and businesses — 35 percent is used for single-family lots, compared to 12 percent for other types of housing. The report notes this creates an equity issue for families, as well, since nearly all of the city’s schools and parks are in pricier single-family zones.


 

• Although concerns about “neighborhood character” aesthetics often frame debates about preserving single-family zones, buildings are in fact getting bigger in those neighborhoods.

Because developers have been tearing down smaller, older homes in favor of large new ones, the average size of a new detached house in Seattle has soared 31 percent since 1990, from 2,660 square feet to 3,487 now. Those new houses are often one or two stories taller than neighboring houses and carry a median price tag far above $1 million.

• Seattle’s housing stock is mostly either very dense (like high-rise apartments) or not at all (like a detached house). The so-called “missing middle” types in between — like duplexes, row houses and one-story apartment buildings — make up just 18 percent of all housing units.

To be continued in next week’s blog…..

~Mike Rosenberg, Seattle Times

Fall real estate cool-down gives negotiating power to the buyers

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If you’re in the market to buy a house, you could be in luck. Compared to this time last year, house hunters have a better selection — and perhaps more negotiating power.
Even with the usual fall decline in houses going up for sale, there are still 4.7 percent more houses for sale now than October 2017, according to the Northwest Multiple Listing Service’s (NWMLS) latest report.

“The increase in standing listing inventory brought more choices to buyers and the meteoric price increases of the spring market have slowed,” MLS director John Deely, principal managing broker at Coldwell Banker Bain in Seattle, said. “Sellers responded by capturing available buyers with competitive pricing or by quickly adjusting pricing.”

Home and condo prices are also the lowest they have been in months, averaging $613,509 in King County, which is down $93,741 compared to last month. Homes are also on the market longer, which can leave sellers antsy to close — and ready to strike a (relative) bargain.

“Buyers are catching on to their newfound ability to negotiate. For the first time since 2012, closed sales system-wide rose from September to October,” said Robert Wasser, a branch manager with Windermere Real Estate in Bellevue.
Don’t get too excited by that drop, though — prices are actually up $48,509 compared to October of last year. Although, that increase could be good news for both buyers hoping to invest and sellers looking to make a buck in the long run.

“Home prices in King County are up nearly 8.6 percent year over year, so we’re still experiencing significant appreciation,” Mike Grady, the president and COO of Coldwell Banker Bain, said in the NWMLS report. “And sellers can still expect to get good prices. All this without the frenzy. A win-win.”

~Natalie Guevara, SeattlePI

Seattle’s hot real estate market begins to slow

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Real estate markets, including Seattle’s, are seeing a dramatic slowdown, according to an analysis by Redfin.

Seattle was one of 14 metro areas in the country this spring where half or more of the homes listed for sale between March 5 and April 29 went under contract within two weeks.

But things are changing, at least for now.

By mid-September, spring’s fastest-selling markets, including Seattle, saw big declines. About 35 percent of homes for sale in Seattle were off the market in two weeks or less over the summer – a drastic change from spring, when 72 percent were off the market within two weeks.

According to Redfin Chief Economist Daryl Fairweather, sellers are waiting longer for offers and many are having to drop their list price to attract buyers.

There are a few exceptions. Omaha, Nebraska; Grand Rapids, Michigan; and Boise, Idaho are still seeing more listing go pending faster than a year ago, though the markets have slowed since spring. The common factor, Redfin points out, is they’re smaller cities away from the coast where homes are more affordable.

“This points to a lack of affordability as potentially the biggest factor in why the previously red-hot markets have slowed so much this year,” the report states.

King County and much of the Puget Sound region saw housing inventory break past two months for the first time since January 2015, according to a recent report.

Housing inventory – or how long it would take to sell all homes on the market – sat at 2.83 months in King County, which is a 78 percent increase over last year. Snohomish (2.18 months), Pierce (2.01 months), and Kitsap (1.93 months) counties all saw increases in inventory as well.

Inventory in King County has steadily risen about 40 percent since May.

~King5 News

How backyard cottages could open up Seattle’s housing market

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Seattle City Council took a step closer toward legislation that would make “accessory dwelling units” easier to build, helping to offset mortgage costs for Seattle homeowners.

This comes hot on the heels of a study released by the City Council, evaluating “the potential environmental impacts of proposes changes to the City’s Land Use Code intended to remove barriers to the creation of accessory dwelling units (ADUs) in single-family zones.”

In layman’s terms, the city is looking to simplify and streamline the process for homeowners to build ADUs on their properties, known colloquially as backyard cottages or in-law units.

Homeowners would then be able to rent these units out, providing an additional source of income that could then be put toward anything from day-to-day living to mortgage payments. Alternatively, it also opens up more housing options for renters.

“We believe that backyard cottages will allow homeowners to increase the number and variety of housing choices in single-family zones,” said Councilmember Mike O’Brien in a press release announcing the release of the study.

Imagine buying a home with a mortgage outside of your price range, but being able to balance that out — or even completely cover the mortgage cost — by collecting rent from a backyard cottage. Opening up zoning requirements to make that easier is the goal for the City Council, touting it a small, creative fix to help offset Seattle’s ballooning housing market.

A planned bill would “remove some barriers to building ADUs, including changes to off-street parking rules, owner-occupancy requirements, and design standards.” The Seattle Times estimates that this would add approximately 2,500 ADUs in the next 10 years, and prevent 500 houses from being torn down to build “McMansions.”

Up until recently though, the City of Seattle has been charging an arm and a leg in zoning fees for anyone trying to build an ADU on their property.

“Most of the municipalities in the Pacific Northwest are in the fee-generating business,” noted KIRO Radio’s Ron Upshaw. “What this entire thing has been structured for up until this point is for them to collect fees.”

Hopefully, homeowners are about to see some relief once the City Council finally settles on new legislation.

Between this, and a promising report from Northwest Multiple Listing Service (MLS), it seems as though the local housing market could finally be softening for new buyers on a budget.

“In the South Sound the market has shifted into neutral and is idling at the moment,” Dick Beeson of RE/MAX Professionals said in the Northwest MLS report. He went on to point out how housing availability improved in Pierce and Thurston counties, “but nowhere near what King County has experienced.”

“Buyers are taking deep breaths as they survey this new territory,” said Beeson, claiming that potential buyers will soon see more homes available for sale for the first time in three years.

If homeowners are made able to both offset their own costs and provide additional housing to renters, that can only mean good things for anyone looking to buy in Seattle in the near future.

~My Northwest