If we want to make houses affordable in this area, we can learn what not to do from, for example, San Francisco.
If we want to make houses affordable in this area, we can learn what to do from, for example, Idaho. After noting that housing has become more affordable in 75 percent of the country during in the last twenty years — and that we in Washington state live in the other 25 percent — I come to this conclusion:
That state policies explain the different trends jumps out at you if you look at that map for even a few seconds. The map shows the changes by county, and the changes often follow state lines. For example, every county in Idaho has more affordable housing; nearly every county in Idaho's western neighbors, Washington and Oregon, has less affordable housing. That isn't because Idaho's population is shrinking; in fact, the state's population has grown much faster since 1990 than the populations of the other two Northwest states.
I suspect that the main cause for those different trends is growth management acts. Whatever the cause (or causes) for the trends, it is certain that politicians in some states and cities have made houses in those places far more expensive than they should be.
(The map that I refer to was published in the New York Times on December 29th of last year. Because of copyright laws I won't publish it here, but I found it this morning by following my links. Anyone interested in this issue should download a copy and study it.)
By the way, the conclusion that regulation increases the price of housing is widely held by economists, especially those who specialize in housing. They have been making this argument for literally decades now, though their conclusions have gotten little public attention.
(Although those who want to buy houses, especially young families, are hurt by the high housing prices, those who already own homes often benefit. It would be interesting to know just how much, for example, Maria Cantwell, who sponsored the Growth Management Act when she was in the state legislature, has benefitted from the rise in housing prices in this area.)
Posted by Jim Miller at February 19, 2006 05:46 AM | Email ThisElected Officials in Washington have become obsessed with anti-growth "Theories" which when glued together become Frankenstein!
These Luddites (aka Lenin's Useful Idiots) are creating an environment where family must have at least one government worker. They simply cannot understand they will ultimately kill the golden goose.
The housing boom in Washington has created more sales tax, permit income, increased property tax base, other fees etc. These enviro-economists hate the building industry....yet are beholding to it.
The great thing is when these baby-LEFTISTS wake up some day with all there sh*t in a crate and no place to live...
You cannot reason with these lunatics. They will only undersand when the consequences of their crazy actions are staring them in there scrunched up faces. Don't even try to reason folks. This is a WAR of individual rights, property rights and heavy handed government. It's a war!
Building "codes" have become criminal law and are so intrusive that there are exemptions from permits for such things as changing a light bulb, putting a swing for the kids in the yard, painting, and plugging "approved" electrical equipment to recepticles. Don't believe it? Check out International Residential Code section 105.2, if you can find it.
Posted by: Bull Maxon on February 19, 2006 08:19 AMThat wasn't good enough for the urban colonists of Oregon and Washington, the goodthinkers who invented the concept of trapping growing populations inside of rigid Urban Growth Boundaries. Of course it drove up real estate prices.
And from these colonists came the antidemocratic structure of the GMA - which placed veto power over the elected community zoning agencies in the hands of politically appointed - NOT elected - Hearings Boards.
Considering that the political support for this Politburo-style thinking came from the left end of the spectrum, isn't it remarkable that that's also the locus of resistance to any sort of elections reform?
The well-heeled urban colonists (take a bow, Senator Cantwell) created a sweet situation for themselves. Those that don't reside in postal boxes can buy large rural spreads for their dachas, safe from vulgar working people moving onto single family housing built next door to them.
Posted by: Hank Bradley on February 19, 2006 08:57 AMFar too many people -- current homeowners, for example -- and institutions -- such as lenders, brokers, builders etc -- gain from a tight market in which housing supply is restricted. Growth management is one way we have created de facto price support for housing and that's why the voters will support it. More people are winners than are losers because of the restrictions of supply caused by Growth Management.
Btw, that's just observation, not advocacy, so don't anyone get their knickers atwitter.
Posted by: David Sucher on February 19, 2006 08:57 AMOf course, the goodthinkers in the Politburo didn't bother to define who would provide it, or to whom it would be affordable. In fact, their failure to define 'housing' is yet another indication that they counted all along on blizzards of votes from mailboxes.
Posted by: Hank Bradley on February 19, 2006 09:02 AMI believe that Seattle is having mini brain-drain as a result of high housing costs and lack of employment opportunities and as a result is becoming older, sicker, and less educated
Posted by: Lew on February 19, 2006 09:14 AMDon't believe me, just start going to the Planning Commission meetings.
Port Orchard, Planning Commission Apr 2005
It was amazing, how a private property owner could not get any relieve on a setback rule for a new garage. But the "well known" contractor could get it for a living structure (home) in the same neighborhood in the same meeting.
When it was pointed out to the Planning Commission, that they had just done just that. The chairman stated, "NO, we did not." So I had the meeting recorder read back the minutes of the earlier discussion.
It clearly showed this same chairman going on, at lenght, as to why the setback rules could not be violated. This caused an major uproar in the meeting and among the Planning Commision.
Result:
It took 3 more meeting before the contractor was granted his waiver. The private property owner had to move the garage and submit new plans, because he never was granted a waiver.
This is also why the eminent domain ruling was no real surprize to me.
This was also the first time, that I ever heard, of a property having 3 front yards, 1 side yard and no backyard for setback purposes.
Posted by: Mike P on February 19, 2006 09:57 AMUh, maybe if we blindly ignore the steadily rising immigrant population this would make sense. But the population does rise, and enough of the newbies are well-enough heeled that they can bid whatever it takes to get onto the bottom rung of the housing-price escalator.
Tough luck to those who don't make enough to do likewise, but hey, they live in a green state where 60% of rural properties are placed beyond use of homebuilders by politically correct legislators who couldn't care less about affordable housing.
Still waiting to hear what 'affordable housing' is supposed to be, and who's to provide it. Anyone?
Posted by: Hank Bradley on February 19, 2006 10:53 AMThey need to make econ a prerequisite to high school graduation in this state. Home prices have gone up 30% in the last two years because of high demand and low supply. The first time home buyer market is almost impossible.
If the communists in this state want to wage this 10 year war to "end" homelessness, the first thing they should do is scrap the urban growth rules and secondly they should repeal the added taxes that making buying a home more expensive. Last year, they raised the costs of buying a home, to fight homelessness!
Seriously, we need mandatory econ education in this state.
Posted by: AP on February 19, 2006 11:06 AMThis had been a nightmare for the smaller rural communities in our region, they are killing growth via regulation on land use,water,concurrency and more. The King County CWPP or county wide plannning policies MANDATE affordable housing, but since they have never and will never make their "goals" they simply move the goalposts for major developers and hose the little guys who has been investing his/her life savings into their own property. It will never change because REGULATION is a growth industry for government and a vital tool in the greater Social Engineering plan.
Posted by: Roscoe on February 19, 2006 11:22 AMGary, I think you are both right and wrong, depending on "where" you measure home ownership levels. In Seattle, the percentage of owner occupied homes has dropped, going by 1990 vs 2000 census figures. And it was already way lower than in King County outside Seattle, or the nation at large. I forget the exact numbers, but in Seattle I think it dropped a percentage point or so (2000 lower than 1990), and is now just under 50%, versus maybe 5 or 10 points higher in the rest of King County and something like 65% to 70% in the rest of the United States overall.
Also, interestingly enough, a couple of states with the lowest median incomes and lowest median home prices - like West Virgina and Arkansas - have the highest levels of home ownership - getting up around 80% as I recall. What does that tell you? By the way, median home prices in some states with lower median incomes, and very high home ownership rates, are below $100K.
Also, there is a study by, again going by memory, some Harvard economists on the "regulatory cost" component of home prices. It's a fascinating study. It indicates the cost of regulations in the price of a house in Seattle (or maybe King County) is over $200,000. I couldn't believe that possible until I read the study and came to understand the methodology and, by all appearances, the complete lack of any bias by the researchers. I think that study is available at the www.proprights.org website. If not, email me and I'll email you the report - I think I've got it saved on my hard drive somewhere.
"If homes were overpriced, why does the price continue to rise? Certainly regulation plays a role, but if homes are unaffordable for any number of reasons, their prices cannot continue to rise."
Another good question/point. I don't consider myself an expert in this, but it's something I've given a lot of thought to, given my own circumstances and background (over 30 years in real estate investing and several business start-ups). One explanation is simply that Seattle is sufficiently attractive (like San Francisco) that it is, by default, attracting high income professionals, retirees, second home buyers (increasing amounts of those in our society for those who are of means), childless households (more money available for housing in those households, and they don't need as much of the higher cost per square foot space or care as much about a yard for kids to play in). In the process the demographics of Seattle are increasingly, and dramatically, changing along those lines. And families are leaving. That makes for a less diverse and, to some of us, less interesting place to live. And it certainly means our children, unless we give them substantial financial help or they are very high income, won't be buying a house in Seattle or King County or maybe even Washington state.
Armen Yousoufian, www.ArmenYousoufian.com, www.Yousoufian.blogspot.com, ayousoufian@comcast.net
Posted by: Armen Yousoufian on February 19, 2006 12:17 PMPerhaps this is all for the good as the self absorbed portion of the baby boomers selfishly destroy a city by driving out families therby committing demographic suicide as they blissfully sip lattes soon to be served to them by low income seniors; the young baristas will not be around-cant afford to live there......
HEH HEH
Posted by: THS on February 19, 2006 01:26 PMSure in the beginning the a command economy may some sense and bring some semblance of control of the economy. Command economies always break down.
However a market driven economy is the by far the best in all respects. What is disconcerting about the market economy is that it is a whirl of creative destruction governed by chaos theory.
People without the guts for true liberty can't handle the uncertainties of a market economy, they crave long term security.
Those who view the market economy as a series of endless opportunities thrive. Even when they get knocked down, the get up and look to catch the next wave.
Those who like the GMA live in fear. Fear of liberty, fear of failure, and even fear of success.
In a market economy, there is a need for low income housing, someone would figure out how to make some money in that market. By drive housing with a command economy model, the truly innovative solutions are denied entry into the market.
Posted by: JCM on February 19, 2006 02:11 PMWhy not? The overall political movement that produced the GMA was the invention of the flower power generation, who couldn't wait to shackle those awful property owners with their 'socially conscious' legislation.
That's the generation who first sprung GMA as an initiative, and then when the voters trounced it by a 2/3 majority, rammed it through the legislature with next to no publicity nor debate.
That generation will soon be living on fixed incomes while their property taxes double every 10 years. Hopefully they'll have time to reflect on their oh-so-slick political exploits of creating the opposite of 'affordable' housing.
And hopefully their progeny will have the sense to revolt against them in turn to correct those 'unanticipated consequences', by reversing the trends which snuff one long-held liberty after another.
Posted by: Hank Bradley on February 19, 2006 02:43 PMand
The recent Washington State Supreme court's decision supporting Unsound Transit's taking of the Miller's land without any personal notification at all (they posted it on their web site as if people make a habit out of going to their web site every day to see if their land is up for grabs)
are
Two very clear examples of how secure your land in in the land of Liberals.
You may think you own it, but keep electing these thieving idiots and you soon will find you own nothing.
Vote to change this in November!
Posted by: GS on February 19, 2006 03:26 PMhttp://seattletimes.nwsource.com/html/editorialsopinion/2002812447_millered19.html
Posted by: Gschroe on February 19, 2006 03:27 PMJCM
GS
Hank Bradley
Washington State will wallow in the doldrums with socialism and command style economies, unfortunately for most if its citizens......
Posted by: THS on February 19, 2006 03:41 PMThank you, and also Stephen and his gang for all their hard work on election reform, keeping this site up, running and popular.
Posted by: GS on February 19, 2006 04:02 PMThe problem is the people in control and who owns them. The law - any law - is only as good as the willingness of government to enforce all its provisions. Myself, I'd like to see governments enforce the transportation concurrency aspects of GMA instead of cheating to help the largest developers build thousands of homes without improving any of the roads. Before we condemn the law, I think it's important that we try to enforce its provisions first, and not just the provisions that help the growth industries.
And for all of you that can't help but paint every issue as liberal versus conservative, the growth industry owns both the parties on this one. They both race for their handouts and give them nearly everything they ask for. Nothing is getting fixed because every solution government supports involves raping the taxpayer to subsidize the profits of the growth industries, and so far opposition has kept the parasites in check. In time, though, as things get worse and worse, I'm sure we'll cave and they'll win and we'll all just cough up what they want from us to fix the mess they've made. We give them stadiums, transit boondoggles, Brightwaters, and eventually race tracks and basketball colliseums. We don't know how to say no to them and they don't know how to say no to their puppet masters.
We tolerate their corruption, we wait patiently when they steal our elections, and yet we keep electing and nominating the same clowns to govern us.
We're just the tit the government sucks on and in time we give them everything they demand.
Posted by: MJC on February 19, 2006 05:15 PMThe concurrency model, whereby the evil developers are held hostage to pay up front for roads that truly benefit everyone in the county - not just the residents in their developments - appears to be a scheme to greatly fatten the County treasury at the expense of said evil developers. Oh yes, and the poor saps who buy homes from them. Isn't one of the antidevelopment buzzwords 'greed'? Isn't the County just as guilty of it?
I know there's anecdotal discussion of favored developers being let off easy on concurrency, but can anyone establish conclusively that this purported racket is a general practice?
Posted by: Hank Bradley on February 19, 2006 06:15 PMI can say that concurrency is a popular tool used to control growth. Water,roads, sewer, schools and even parks and open space are used as measuring sticks before growth/development can be approved. There is a proposal to allow cities to get involved in Incremental finacing options for infrastructure development. Sort of the "IF you build it, they will come strategy " where the city charges a sort of late comers fee to the future tenants who come as a result of the infrastructure improvements that have already been made.
Posted by: Roscoe on February 19, 2006 07:19 PM"You only need to look as far as the Trilogy/ Northridge developements outside of Redmond on Novelty Hill Road to see..." one of the anecdotes. Now, does this demonstrate a general principle?
And couldn't "the capacity of the Novelty Hill Road to handle the new influx of proposed building in the area" be increased as necessary, funded by bonds secured on the increased property taxes of the Trilogy/ Northridge development? Or does the County intend to rake off that bonding capacity to finance something unrelated to Trilogy/Northridge?
"Water,roads, sewer, schools and even parks and open space are used as..." sticks to beat developers, and levers to raise housing costs. Until the 1990s, County infrastructure paid for itself - just look at the financial success of all the water and sewer districts who started with soda straw pipelines in the 40s and 50s, managed themselves conservatively, upgraded their pipe networks as they went, and developed an enviable bonding capacity of their own.
Already in the late 70s, King County was thought to be planning to take them over so that it could divert that capacity into schemes having little to do with water and sewer utilities. Talk about greed...
Posted by: Hank Bradley on February 19, 2006 08:10 PMMy comments merely pointed out that concurency is a popular tool used to control growth. Of course nothing says controlled growth like a good old fashion CAO regulatory taking. I can tell you from attending some local SCA meetings and PSRC events the schemes are still afoot to consoldiate power.
Posted by: Roscoe on February 19, 2006 08:46 PMYou're making a specious argument about building restrictions.
Posted by: jdavis44 on February 19, 2006 11:50 PM"Urban villages" my b-hole.
Posted by: BananaLand on February 20, 2006 01:07 AMSomeone must, since as I pointed out in the post:
"[the] state's population has grown much faster since 1990 than the populations of the other two Northwest states"
And faster than that of the nation as a whole. The Census Quick Facts, which I have linked to on my home site, will give you the numbers.
Posted by: Jim Miller on February 20, 2006 04:52 AMYou got that right....they are elitists. They will use the Jesse Jackson model of DEPENDENCY for their power base. After all, who can be against someone who GIVES them FREE Sh*t!!!!!
One correction Bananaland----
They are called Urban ECO-Villages!!!!!
And Idaho was still 37th in population per the 2000 census. I think we should wait until Idaho starts to reach regional density levels like Western Washington before we use them as an example. The growth rate in my home grew a whopping 150% in the 1990s, but I wouldn't compare my home's growth rate to Idaho. I think comparing Idaho to Washington is just as dangerous.
Let's look at Idaho in 2030 with a forecasted 52.2% increase in population compared to 2000, or 675,000 people. Compare that to Washington's 46.3% increase (less than Idaho), or 2.7 million increase in population (4 times the number of people).
Idaho will always be able to keep pace with growth better than Western Washington. In actual people, Washington is growing 4 times faster with 4 times the number of houses and jobs needed to keep pace and 4 times the infrastructure growth or more when you consider roads. When you consider the Southern California effect, where growth on the fringes of urban centers costs an ever-increasing amount in roads to move people into the urban centers as people need to drive longer and farther, the problems of growth will always be more severe for the higher density regions. The Puget Sound has been in that scenario for decades now, and stil in denial as we build more and more homes and do nothing to our road networks.
Today, Idaho is probably where Washington was in the early 80s. Give them a couple decades of this high growth rate and then we can see how well they've doing.
Posted by: MJC on February 20, 2006 10:23 AMConcurrency is not by definition the responsiblity of developers. It is simply a requirement that roads must meet demand within 6 years of development approval. (Government-speak for "concurrency") Whether funded by the developer or the taxpayer, it simply makes sense that roads must be kept up with demand.
Here was the problem with Redmond Ridge. To meet concurrency, Novelty Hill Road needed to be widened to 5 lanes. Doing this to a 2-lane rural road in the rural part of the county was absurd. King County knew they couldn't convince the voters to accept it, and Weyerhaeuser wasn't going to pay the $100 million for it anyway. So the answer was to cheat in the analysis to show that the road wouldn't need to be widened. And DOT was willing to step up and do it. The road is still 2-lanes for most of its length today, with miles of backup in the commutes, and Redmond telling King County they can't widen the road to dump more volumes into Redmond. It's a disaster!
Bonding isn't the answer either. Despite the interest, those bonds do eventually have to be repaid and a bonding model can't be used to fund the $50-$100 billion in unfunded road projects in Western Washington without new and significant tax increases somewhere. In desperation, Weyerhaeuser allies in King County have approved a $20 million bonding plan for Novelty Hill Road, but it's just another cynical facade from a government owned by special interests; invented to support approval of 800 more homes in Redmond Ridge and only a fraction (~25%) of the eventual cost to fix the road at best.
The problem of unfunded road projects and the growth industry's desperation to keep the machine rolling has become massive. Both parties would love to adopt new taxes to help them out, but the shear size of the problem now is preventing government from being able to deal with it. That explains the 9 cent gas tax Hail Mary and the others destined to follow. In a decision to defend the growth industry's interests versus the taxpayers', we lose every time. It's a train wreck coming that too few are working to avoid.
Posted by: MJC on February 20, 2006 11:01 AMYour home may be worth more, but so is the cost of anything else in the market you'd want to buy. The downside of rising housing costs is the increase in assessed values and increases in property taxes. Of course any government-designed system is crafted to help government extract more money from people, right? And that creates a very large incentive and motivation for government to support policies that create increases in property values, such as limited supply and control of who builds and where they build.
Posted by: MJC on February 20, 2006 11:14 AMIn addition, we don't know how they are calculating the median home value or median income. State/national/county? Until those questions are answered, it could be the case that high home values (and incomes) in urban areas made eastern WA counties look more expensive than they are.
Posted by: c&d on February 23, 2006 10:51 AM