Mayor Murray calls for 20K more affordable housing units in next decade

IMG_3672Following his pledge to provide an “aggressive” goal for new affordable housing units in Seattle, Mayor Ed Murray announced Thursday he wants to create or preserve 50,000 new housing units in the city over the next decade, 20,000 of which would be income restricted. Murray is directing his Housing Affordability and Livability Advisory Committee to come up policy proposals by May to meet the target.

“Seattle is facing a serious lack of affordable housing options that displace families and people in this city,” Murray said.

The 20,000 income restricted units would be for individuals and families making 80 percent of the area median income and below. The other 30,000 units would be market rate. Murray didn’t specify where those units would be built or preserved, only that they would be within the city limits.

Here’s a look at the income levels for one and two person households that the committee will be targeting:

Screen-Shot-2014-11-18-at-3.49.49-PM-600x82

Earlier this month, the Community Housing Caucus, a group of low income housing advocates and legislative staff, produced a report with dozens of proposed planks to be included in the final recommendations. That report followed a 14-point set of recommendations sent by the developer-focused Coalition for Housing Solutions to Murray’s office.

Last year, Seattle had the fastest rising rents among major U.S. cities, causing some officials to say affordable housing had become a full-blown crisis. Last year, City Council members passed a resolution to start drafting their own affordable housing plan that would involve having developers pay a “linkage fee” to go towards building more affordable housing.

Murray has stopped short of using the “crisis” label and told CHS the explosive growth in Seattle doesn’t have to be mean the end of neighborhood culture. “These things can be good for cities,” the mayor said.

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35 thoughts on “Mayor Murray calls for 20K more affordable housing units in next decade

  1. This is a good start, but doesn’t go far enough. In 2014 80% of the median was $44,750 for a single person, which translates into a median income of nearly $56,000. The problem is that there are a lot of people who probably who earn close to that, but who are also being priced out of the rental market due to the skyrocketing increase in rates – over $1,300 per month (not including utilities in most cases) as of the end of 2014, and probably even higher today. Most new developments are going for considerably higher than this, which combined with low vacancy rates and heavy demand inevitably creates upward pressure on older units on-the-market as well.

    The middle class needs just as much relief as do the working poor; and telling them to move to Kent or Des Moines where rents are cheaper doesn’t really address the problem, because those who work in Seattle just end up having whatever cost-savings are involved with moving farther away eaten up by increased commuting costs and corresponding loss of time – a data-point I seldom see factored into the equation.

    • It’s a pretend solution to a really difficult problem–how do you deal with affordability in a city where housing costs have gone nuts? If the only people who’ll be end up able to rent within city limits are the top 20% and bottom 20% on economic scale, have you solved anything?

    • Someone has to pay for subsidized units. If you lower rents for a minority (i.e. lower income people), it will raise rents for the majority (i.e. middle- and upper-income people), unless you inject funding from another source. I doubt that high-income people would pay rents high enough to subsidize low- AND middle-income people, but we shall see how it plays out. I, for one, think the middle-class squeeze is just getting started in Seattle.

    • Are you saying that a person who earns $56,000/year cannot afford a $1300/month apartment? These figures translate into that person spending only 27% of their income on housing, which is below the maximum 33% figure usually recommended, so it seems to me that the person is not being “priced out” of the Capitol Hill market, and could even comfortably afford a somewhat more expensive place.

      Or am I missing something?

      • I think what you’re missing is the percentage of net pay going to rent versus gross pay. The reality is the money we have leftover after taxes and other deductions is what we have to spend. Then the percentage going to rent is higher.

      • This is true. Even at a 10% tax burden after all deductions, etc. you are looking at a generously calculated net of ~50K. At 25% budget of net pay for housing you get to about $1050/month.

  2. Exactly. Why are people who chose to rent in the city able to be victimized by property owners, who slap on some paint, change the carpet and call the building a ‘luxury unit,” jack up the rent and then start all this nonsense talk about walkability scores, or any other obvious reason someone might choose not to live in the suburbs, (communte aside). There is no doorman, pool or other new luxurious amenity and the sq. footage hasn’t changed. It’s greed and avarice. Housing is housing, not luxury living. It ain’t Paris.

    • Victimized? Isn’t it simple economics? Supply & Demand? These units are only renting for what people are willing to pay. Why are property owners not allowed to let the market dictate what they charge for THEIR properties? If you were selling your car with 2 interested buyers, would you not take the highest offer? Do you realize that there are even cars that become old, rusty, and more unreliable, yet fetch a higher price than they once retailed for because of the market demand? The same can be said for housing. I don’t understand your point.

      • Exactly. These people screaming about mean landlords all try and maximize their own profits as well. Capitol Hill is changing for the worse and most of agree on that but since when does somebody deserve to live in a particular neighborhood? I grew up on Capitol Hill and can’t afford to live there now. So I moved. Neighborhoods change and people have to adapt. Pretty simple.

      • Housing is more of a limited resource in Seattle (despite the building boom) than cars are. And shelter is a basic necessity, like food.

      • If food became unavailable or so expensive in your area, would you starve? Or might you seek food elsewhere where it might be more readily available or cheaper? Living in a highly desirable location is not a necessity. That’s like being upset because you want a Ferrari so badly but can only afford a Honda.

      • A more appropriate analogy would be: you’ve spent the past 10 years paying off the Honda you drive, but suddenly the bank tells you what you’ve got is a Ferrari instead, and they jack up your payments by 200%.

      • In which case, I would sell that Honda as I no longer agree with the rate they are telling me I should pay for the same car. If they can get more money for that car, by all means do so, I don’t own it. Why should I be entitled to something I don’t own. I would move on to purchase a car that aligns with my financial means.

      • The difference with looking elsewhere for less expensive food is that you don’t have to put up first, last and deposit for a different, cheaper apartment. All you have to do is go to another place. I understand what you’re trying to say,but it’s not the best analogy.

      • Market forces are exactly what led to the Great Recession of 2008. By staying out of the messy housing market, now CH renters are at the mercy of landlords. I am for rent control and moderation, not hyperbole, hype and garbage strewn streets, and a 70 year old dump that has suddenly been labelled as ‘luxurious’ and the rent is raised every year It’s greed. The city needs rent control!

      • Who finances that? Middle class property owners are already getting hit up twice a year for special levies for everything, in springtime special elections and again in November. Or if it’s not tax-supported, it just makes non rent-controlled apartments even more horrendously expensive once somebody moves out. So the only people who can afford the rents are either very high-income or pretty low income. Middle class gets hosed either way.

      • Sure, it’s “supply and demand”, but the system we’ve developed based on this principle is inherently rigged FOR those with the supply and AGAINST those who generate demand. I’m not suggesting a return to a primitive communal hunter-gatherer society, but the simple fact is shelter from the elements is a basic necessity for human survival, even at the most rudimentary level, and individuals no longer have the opportunity to carve out a space in the wilderness to call our own. Instead we’ve created an economic system whereby the few, the property owners, benefit enormously by forcing the many, those who simply cannot afford to own property themselves, to compete for access to a limited amount of shelter, and almost solely on their terms.

        In the case of housing, those who create demand have little in the way of recourse from those who control supply; one way or another we pay through the nose – and that includes many who are saddled with the illusion of ownership, namely, anyone paying a mortgage, because they are really just renting from banks until they either pay off the loan or sell to someone else, and hopefully make enough in the process to get themselves out of debt, which is itself no guarantee as those who suffered in the recent housing bubble burst have come to understand.

      • While I certainly understand the necessity of having a roof over ones head, I am having a hard time grasping the thought that living in a highly desirable location is a necessity. Living in a high demand and extremely desirable city is a nice to have. The same type of shelter is available elsewhere at a much cheaper cost if you are someone who is just looking for that necessity.

        Instead of being upset at the rising costs (IE: the inevitable for any desirable city. See: San Francisco), one should be happy that they were able to live there for any period of time at all.

      • It’s not quite *simple* supply and demand. In your analogy of buying cars, imagine it’s more like you have two people interested in buying a car, the seller refuses to sell the car until he/she gets some over-inflated price point, and will hire marketers to try to convince potential buyers the car is worth the inflated price point (which may become even more inflated because it now has to cover the cost of marketing – i.e. leasing agents and advertisements). So, supply is actually artificially constrained, prices are inflated, and the available “cars”/vacancies becomes even more limited to a handful of suppliers/major developers, who then gain even more control over the market. Certainly some folks will pay the high prices and some will move, but the dynamics at hand are not quaint little supply and demand, but monopoly and marketing. Personally I would like to see the developers of the large “luxury” buildings held to a certain required occupancy rate so they can’t artificially suppress supply and inflate rental costs for the entire neighborhood.

      • Why should developers be told what to do with their money and be held to a certain occupancy? Wouldn’t they be losing money every day a vacant unit remains vacant. They’re bearing all the risk in their investment and I’m sure understand how much vacancy they can stomach before dropping the price to regain some capital. I don’t understand why they shouldn’t try to make the greatest return on their cash within the legal confines of the law (marketing etc.) when is the last time you turned down a raise.

      • Well, that sort of requires one to be OFFERED a raise, doesn’t it? And even if one gets a raise, is it really an increase in net earnings, or does it just keep up with the increase in the overall cost-of-living?

        And when was the last time you heard of a developer LOSING money on a construction project? I mean, how can they, when the bank that loaned them the money to develop the property gives them a sweetheart deal, at rates of interest far lower than the average person can leverage, and with a longer payback schedule? Commercial developers have access to all sorts of options and perks that individuals don’t: for example, typically interest payments on the loan principal are due well before construction is completed and tenants start generating revenue, so one of the things developers do is to set aside a portion of their loan into an “interest reserve”, essentially using part of the loan principal itself to pay the interest when it comes due. The banks are totally okay with this, because the expectation is that the developer has asked for more than the actual cost-of-construction or land purchase in the first place, and that they’ll make it up when they start to actually rent units; where the additional cost inevitably gets passed along, thus ensuring the developer never has to pay it out-of-pocket as it were. In addition, the developer usually has other properties that are already generating revenue to use as loan collateral; again, not generally an option for a person with no real estate assets already.

        In short, unless they’re totally inept (in which case they wouldn’t be in the game very long), there’s simply no way for them to lose money on any given project, because the entire system is already rigged to guarantee they CAN’T, short of some sort of catastrophic economic melt-down. And even then, the banks still come out on top, because they can always foreclose on the asset, regardless of how “owns” it, hold it for as long as they need, then flip it when it becomes profitable to do so once again. Maybe this will take decades, but it’s a bank, not a corporeal entity, so time is irrelevant; actually human beings don’t have that luxury.

        YOU try doing that and see how well you come out.

      • It isn’t some “market adjustment.’ Its predatory as hell and unsustainable. A city cannot function by pricing out the many layers of workers who are not making 100K a year.

      • You’re right, it can’t function by pricing out everyone. At some point people refuse to pay the inflated prices, or they’re unable. And they move somewhere else they can afford. The supply increases and prices come down to meet the demand. Yes, it’s *exactly* a “market adjustment”. If there weren’t people willing and able to pay the ridiculous rents, they wouldn’t be charging them.

      • Exactly! Many of the claims being made (see “predatory practice”) seem to be originating from emotion rather than fact. I agree that it’s a bummer to be priced out, but accept this reality as this is a market based economy. Stating that a city cannot function by pricing out everyone under $100K seems to have many holes in the theory. I don’t recall NYC or SF struggling to function.

        If the demand was not there, these prices would not exist. Developers/investors don’t just jack the prices up and let units remain vacant for fun.

  3. Oh God I miss Seattle, but simply could not afford it any longer.
    We lived on Broadway in supposedly a luxury building. It was a wonderful space, but the apartment was fixed out in Antique Walmart. The office staff changed constantly, after 6 months, the ice machine in the fridge was still not fixed, often we were not alerted when a package arrived.
    The third year, we were invited to renew our lease at $3,050 a month.
    We moved to LongBeach, Ca. Our building has a full time door person at the desk, a heated pool, Jacuzzi and sauna, a large library/lounge and exercise room, guest parking, and, are you ready for this TWO parking spaces.
    It’s about the same size as the Broadway apart, but also has a outdoor terrace.
    It’s right on Long Beach and the rent is $2100 a month. But we do miss the great city of Seattle.

  4. I am shocked that it took a whole committee all this time to come up with essentially amounts to nothing.

    It would seem Seattle is ready to create its first “projects” and you know how that goes. http://newsone.com/1555245/most-infamous-public-housing-projects/

    Not to many years ago rents were plummeting because there were no people available to house. Renters were getting one sometimes two months of free rent and other perks just for signing a lease. Did anyone form a committee, ask for a hand out or government intervention? Some people sold their property at rock bottom prices because they couldn’t afford the taxes and other expenses. The only people who profited were in real estate and banks and the city.

    Isn’t anyone alarmed that foreign investors are buying most of Detroit?

    I know the rents are ridiculous here but there is only one reason for it. For the last 20 years we have HEIGHT RESTRICTIONS and other stifling stipulations instead of building what the people need. When there was a need for 100 units we built 25 over and over again we keep making the same mistake and we turn a blind eye to the obvious. It’s like hey Florida, it’s called climate change not “atmospheric re-employment’ So hey Seattle it’s the preservationists throwing a wrench in the machine of progress which is causing this problem not the property owners or anyone else you want to blame. These preservationists have no validity to their claims yet they are allowed to cause all this destruction and harm. I think the committee should take a long hard look at those facts and build what the people need instead of short fat ugly buildings.

    There must be some way of holding these preservationists accountable all the damage done. No one is getting what they want. Get rid of these people. I am sure when we lived in caves there was a committee that gathered and complained about those ugly tepees, log cabins and everything else and I am sure if they had their way we would still be living in caves.

    • I think you’re completely missing the point. No one is advocating building Cabrini Green in Seattle. The proposed plan calls for developing affordable units as part of larger scale buildings that would house all income levels. Not relegating the poor to some island.

      Also, height limits are getting lifted, or are about to be, in developing areas of the city like the U District which is ripe for re-development. I agree with you that preservationists sometimes get in the way. In this case, I’d love to see some of these poorly constructed two-story apartment buildings that have outlived their usefulness developed into taller, more efficient buildings that can house people across income levels. The old buildings do not bring anything from a ‘historical’ perspective to that area. Many are falling apart and are in need of demo/reconstruction where more people can live on the same physical footprint.

  5. Of course poor people have no right to live in a nice city if they can’t afford it. But if they have to move away, who will serve the poutine? Detail the Teslas? Deliver the Amazon fresh? Horror!

    • People continually claim this as fact without any evidence. It seems as the fat cats in NYC have plenty of minions still around to serve them. The silicon valley nerds aren’t hurting for a server at dinner. I don’t think these types go extinct just because a city calls for a premium.

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