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EmailGood story by Aubrey Cohen in the Seattle P-I about Seattle's unaffordability. (For other recent stories on this topic, see my Duwumps selection of bad news.)
The gist is simple: The typical worker in Seattle cannot afford a single-family home or even a condo. Rents are rising as well. The numbers:
Last year, the typical single person in Seattle earned enough to buy a home for just under $200,000 while the typical family of four had enough to pay just over $280,000, according to the U.S. Department of Housing and Urban Development. [Seattle's] median prices were about $450,000 for a house and $290,000 for a condo.
The response of policy makers and developers in Seattle has been to build more housing – but not for average folks. Density is increasing, mostly on the high end of the economic spectrum. So what are working people doing? The P-I points to a trend that is obvious but rarely mentioned in the hype over the benefits of increasing Seattle density: sprawl. Yes, the rapid upscaling of the market is driving Seattle's workers into the suburbs.
So we're increasing densities to accommodate the demand of the affluent, yet not deriving the supposed environmental benefits because the market is pushing working people into the 'burbs. This is moving us to what I think is a worst-of-both-worlds scenario: Los Angelsization. L.A. is both the most dense urban area in the country and also the most sprawling. Dense sprawl. Now that's Californication.
The numbers here are eye-opening:
[M]any median-income workers choose to buy and commute rather than rent. "They can buy somewhere, but that somewhere isn't in the city of Seattle," said Adrienne Quinn, director of the Seattle Office of Housing. Just 49 percent of people who work in Seattle live in the city.
Add this in the data in another P-I story by Cohen on March 22:
Strong job growth in King County and longer commutes to outlying communities are two reasons experts give for new U.S. Census estimates saying the county is growing faster than it has in years. The numbers, released today, show that more people moved to King County from elsewhere in the U.S. than left for another county last year -- reversing a trend going back at least to 2000.
The market dynamic creates a dilemma. More development restrictions make city housing less affordable. But simply building more housing doesn't solve regional growth problems. High-priced density doesn't stall sprawl, it actually drives it when there's still plenty of land to develop.
I've said it before: The one place we need to get creative is changing the market dynamics by reducing demand. It's common sense. If you have a business that's in trouble, you don't just increase revenue, you try and cut costs – you work both sides of the equation. We cannot build our way out of growth.
One proposal I've touted is redirecting in-migration to places that actually need more people, like North Dakota and other heartland states that are losing population and want to be revitalized. The New Homestead Act proposed by Sens. Byron Dorgan of North Dakota and Chuck Hagel of Nebraska would actually reward people for relocating in rural areas. Even without such an act, many companies are responding to the need to find more affordable communities for their workers. Microsoft, for example, is expanding its operations in North Dakota. Call it Red Midwest.
But it also means cultivating an economy and values that are not growth-obsessed. Or that don't operate on the basis that the demand side of the market is unstoppable. "More" is always accepted as a given that we are powerless to resist. But the consequences of allowing the market to romp can be devastating to the environment and destroy communities that serve people all up and down the economic ladder.
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Comments:
Posted Mon, Apr 2, 5:13 p.m. Inappropriate
growth obsessed: Mr. Berger,
Aren't Sens. Hagel and Dorgan being just as "growth-obsessed" as you accuse Seattle leaders of being?
That aside, it seems unlikely that a few tax breaks, no matter how generous, could counter the immense tide of opportunity that's pushing an entire generation of Americans toward coastal cities. The winters in North Dakota will be just as bad, no matter how many incentives you offer.
And finally, presumably you reduce demand by restricting growth. But unless we force Microsoft to shutter its doors, people will still want to buy houses. Won't restricting development just increase the price of existing housing stock, thereby making the city even more unaffordable?
Congratulations on the launch of the new publication.
Posted Mon, Apr 2, 6:29 p.m. Inappropriate
RE: growth obsessed: ... adding, I completely agree about the glut of high-end condos. I wish there were more diversity to the new housing stock.
Posted Tue, Apr 3, 9:18 a.m. Inappropriate
total disagreement: I disagree with the article totally. Adding density does not add sprawl. Adding units in Seattle reduces the growth pressure in other areas.
As for sprawl, we have a good growth management system, and we should keep it tight. Sprawl has been greatly reduced. If only the other counties were as rigorous as King!
Yes, people with low to moderate incomes are leaving Seattle in substantial numbers. But they're far outnumbered by those moving in. When you think about sprawl, you have to think about the second group too! They could have sprawled but didn't.
King County had slow growth for several years, until recently. This has changed because developers are finally geared up to build projects that current zoning and available land allow, and because the public finally wants what they're selling/renting.
I don't buy the standard affordability ratios either (though in this case I'm arguing against the mainstream). The 30% figure should be replaced by a housing+transportation figure, say 50 or 55%. Like many people, personally I afford my "expensive" condo because I don't have a car. I don't fall within the 30% figure, but I do fall within the 50% combined figure.
By disclosure, I work for a general contractor. But I was a nerd for this stuff long before that.
Posted Tue, Apr 3, 12:02 p.m. Inappropriate
ditto on the total disagreement: I'm a native of the PNW, but - unlike Mr.Berger - I recognize that as population has grown, we can't all live like hermits in the woods anymore.
Times change. The transformation of the city into a dense, pedestrian-oriented residential center is happening. And that's a good thing for the city, region and the environment. I'm excited to see the cranes sprouting all over, adding thousands of units of housing. We desperately need it.
Berger isn't advancing any kind of constructive agenda for the future of the region. If he was genuinely concerned about the middle class, would he imply - as he has in this and other columns - that we should restrict the supply of housing and jobs, and move newcomers to North Dakota? That sort of thinking is weirdly nativist and antisocial - an unpleasant side of the Northwest psyche that I hope is soon left behind.
It's also a bit ironic that the old-timers who fiercely resist adding new housing stock in the city - to preserve Seattle for the middle class, they say - are precisely the ones who benefit most from a scarcity of housing. Their home values just go up and up...
Posted Tue, Apr 3, 1:45 p.m. Inappropriate
more disagreement-fest: Good points. The main reason to build new housing is to avoid a San Francisco style imbalance between supply and demand. Their prices are double ours despite land and development costs that aren't that much higher.
And yes, some of us love urban neighborhoods. This is fun to watch.
PS, I'm a native too. Swedish Hospital. Good to meet another.
Posted Wed, Apr 4, 2:38 p.m. Inappropriate
just a thought: In general, increased density doesn't cause sprawl...but the type of growth matters. Increasing density at the high end of the market does nothing to keep the "typical worker" from moving out to the suburbs, so rising real estate prices will continue to push them there.
But I wonder...if the city sought to increase density for "middle class" demographic, would it have an effect on overall sprawl? My sense is no. Given that more people are moving into King County than are moving out (unlike the article, this is under the assumption that demand will continue to rise), I think the more interesting question is around population distribution. In other words, who should have access to housing in the downtown core? The proliferation of the high-end condo market says something about the kind of folks we're trying to attract into downtown...and it's not the "typical worker".
Posted Wed, Apr 4, 7:50 p.m. Inappropriate
Try Wenatchee Instead: I agree, the housing market's out of whack. Perhaps we should take a break from all types of zoning carrots aimed at new construction - the tax breaks and added height, reduction in open space, etc., and quit rewarding the construction of overpriced condos and six-pak townhomes that get wrapped in plastic and lawsuits in two years. Those gimmicks are not providing affordable housing or preserving it. But people don't have to move all the way to Dakota... try Wenatchee, Omak, Yakima, Ellensburg, Cle Elum, Walla Walla, Tri Cities, Okanagon - even Bremerton for starters.
Posted Thu, Apr 5, 10:37 a.m. Inappropriate
Not everyone wants to buy a house...: I'm a confirmed renter. I'd rather rent that own a house. But as of late, with flat wages and the rising market rates for apartments, I'm afraid that I can't afford to live outside of Seattle, let alone in Seattle.
I currently live in Kenmore, in a set of apartments that are nearly 30 years old. Yet the property management company that owns the complex keeps raising the rents to "market rates". However, I'm not living in a market rate apartment. If anything, it's below market rate, due mainly to it's age and construction.
When I moved here, Kenmore was about half the rent of downtown Seattle apartments, but now the rents are rising to about three quarters of the rent. Yet, we don't have yuppies or MacMillioniares living here, just working folks.
I think part of the reason we're seeing higher rents is that most apartment complexes are owned by out of state property management companies, who don't care about the people who live in their properties, but instead care about their profit margin and don't care if renters leave because of high rents. If enough leave, they can go condo.
I don't think we need rent caps, but we definitely need some form of rent control.
John
Posted Thu, Apr 5, 10:50 a.m. Inappropriate
rent control?: New York and San Francisco have rent control, and look what it's done. It's great for the people in those units, but it's horrible for everyone else. Rent control drives away development, resulting in a huge imbalance between supply and demand. NY and SF are our two most outrageously priced cities and it's not a coincidence.