You’ve Come a Long Way on Housing Supply, Seattle; Sort of

I remember it clearly, and to protect the guilty I won’t name names. But the conversation was about — what else? — housing, and I was with a person who worked for the Mayor’s office at the time and some other familiar faces of urbanism.

Why, I asked wasn’t the Mayor’s housing committee (yes there was one then, too) looking at the importance of supply.

“More supply is good, but it won’t lower housing prices.”

Huh?

Then two out of the other three people at the table agreed. They just didn’t believe more supply would have a beneficial impact on housing prices. Rents only go up, they said. And if I wanted to be “effective” I should drop the supply argument. Too divisive.

So in looking over where Smart Growth Seattle has been, and my own trip through housing and growth discussions, I’ve always been amazed at the games people play with themselves in Seattle to be nice. Not divisive. Even when it’s about the facts.

The good news is that today, three years later, just about all Urbanists (whatever that means) are united : we need more housing supply.  As the Virginia Slims add used to say, “You’ve come a long way baby.” Everyone at that table today, I think, would have their rap down: more housing is good because it provides more options for people at all levels of income. And the Mayor’s Housing Affordability and Livability Agenda (HALA) Committee, unlike earlier committees, was much more aligned to the idea that the production of more market housing is a solution to price increases.

But that’s where it ends. There isn’t broad agreement on how to create the supply. And there even supply-siders who support inflationary measures like Mandatory Inclusionary Zoning and even rent control. Supporting more supply to solve our housing shortage has become the new “environmentalistism” — even Donald Trump would say he’s an environmentalist.

Still, it’s an important transformation from the arguments I had with really smart people as long as five years ago who said, “Housing is a different kind of product in a different kind of market,” or others who called me, Roger “Housing is bananas” Valdez. Of course bananas are different from housing, but scarcity of either will make them more expensive.

How did the supply-side transformation happen? Two ways. First, being relentless in raising supply as a solution in every forum where housing was being discussed and arguing for it. To some significant degree, the supply deniers were worn down, not convinced. And that isn’t because some detente could have been reached. Denying that more housing would help lower prices is a consequence of economics: if I’m here already and own a home, higher prices benefit me. And for those who want more money from government it’s also more beneficial if subsidies are the answer.

Second, people came around to supply because it was a principled stand. Principled positions are more attractive than wishy washy hedges about density and the housing market. Arguing for supply gave shape to an intellectual point of view; people in Seattle like to think of themselves as super smart, even if they aren’t.

Where do we go from here? What will we be arguing about in three years? Sadly, people in Seattle have shown a need for consensus over consistency. We’ll likely be seeing the full effects of the damage done by MIZ in three years if it moves ahead as promised. The non-profit housing developers still won’t have he capital they need because in spite of more fees collected and some units built, the housing scarcity will continue to mean higher prices for land, labor, and financing. The claim that there isn’t enough money in the world to build all the subsidized housing we need will continue.

We’ll also keep seeing red herrings, like the reason prices for housing are high is that rich Chinese people are buying all the housing and leaving if empty. Not to mentions the tens of thousands of units lost to Airbnb speculators making money from their property from tourists rather than “real people.”

It’s likely that the next leap forward for the principle of making more housing as a solution to many problems including prices, energy efficiency, climate change, and water pollution will come after the next downturn. Perhaps we’ll see some people with real business credentials elected to City Council that will champion simple  market solutions (lake incentives and lowering costs) to create more jobs. Maybe those Councilmembers will call us and say, “How can we help you make more housing and the jobs and value it creates?”

I can assure you builders and developers won’t say, “More zoning,” or “Upzones!” What I’ve learned over the last twenty years is that people who make housing happen want more certainty and a shorter time to get their product to market. A guy selling bananas can adjust his price on the spot to respond to the market; imagine if his bushels of bananas were still in design review when demand for bananas fell or went up. We shouldn’t and can’t compromise with people who stand in the way of creating a good for the community.

We’ve come a long way. And we’ve got a long way to go yet. But what would help is kicking the consensus habit. If a proposal doesn’t unwaveringly promote more housing without penalizing it we’re against it, period. We get very few benefits from making the problems worse with half measures. We know what the answer is; let’s act like it.

Comments are closed.