Legislature looks at affordable housing as red hot housing market continues to rise
SEATTLE - After a public hearing on House Bill 1782 on Saturday two things seem certain: There’s not enough housing in Washington state, and finding agreements on how to fix that problem won’t come easy.
HB 1782 – known as the "Missing Middle" housing bill – would lift local laws that ban multi-family homes. The goal: to create more "middle housing" like duplexes, triplexes and townhomes that would be more affordable. HB 1782 would change residential zoning laws for lots within a half-mile of major transit stops.
Hugo Garcia, a recently elected Burien City councilmember, testified in favor of the bill. He said that living in a duplex was the only way he could afford to live close to his aging parents.
"Our housing and home list prices have to be addressed at the root cause, which is available units," said Garcia. "I have done everything I can to make sure that housing and having this modest choice is accessible to as many people possible, because I have that lived experience."
Other city leaders from municipalities across Puget Sound aren’t as supportive.
Elected officials from Gig Harbor, Issaquah, Kent, Auburn and Lake Stevens all spoke against the bill. Some leaders argued that regional authorities have a better understanding of local needs, to concerns over growing too quickly.
Issaquah Mayor Mary Lou Pauly argued that the bill would increase density outside of the urban core where services like shopping and schools aren’t accessible.
"This legislation would result in car-centric growth undermining our climate goals and exasperating our deficient transportation system," said Mayor Pauly.
No one argued that affordable housing wasn’t needed. Over the past three years home prices have skyrocketed in Puget Sound.
Scott Hotes, a real estate broker and Vice President of Skyline Properties, said there is no single answer to why prices are taking off. Hotes said he fields questions about the red-hot market every day, but few real estate brokers or economists can boil that down to a single answer.
According to Hotes, the pandemic has fueled a number of factors ranging from buyer habits to interest rates. With historic low interest rates buying power has increased, and in an area with a lot of wealth prices have risen quickly.
A lack of available homes for sale has also pushed the prices to new highs.
"We don’t have a lot of land," said Hotes. "We haven’t had a lot of land ever, with the Growth Management Act that limits what we can build where and how."
While it’s not the only reason for prices to be so high, Hotes supports more multi-unit family housing. He said it’s one way to create more affordable options for home buyers.
As for the market itself, he said the most predictable end to the latest hot trend will be a change in interest rates – that would effectively lower the buying power of homes that are currently setting the market.
If there’s any good news, he doesn’t expect a crash like we saw in 2008.
However, for people looking to see prices drop – the end doesn’t appear to be in sight yet.
A week or two ago Hotes said data from Skyline Properties – the largest independent real estate company in Washington – showed that homes were closing regularly 10-14% above asking price, though recently that number is moving even higher in the realm of 14-20%.
Hotes said he knows brokers who are growing frustrated as buyers are putting in 15-20 offers above asking prices, and still failing to close as the red-hot housing market continues to rise.
When it comes to a decision on whether HB 1782 will survive – that will come down to a decision on Monday. A deadline looms for the bill to make it out of the local government committee. If it survives and passes in the House, a similar process will take place in the Senate.
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