Don't blame growth management for higher housing prices

The cost of housing is spiraling out of control in many parts of the Puget Sound region. King County is redefining sticker shock for homebuyers as the median price of housing approaches $440,000. Years of double-digit increases are a serious threat to many people's dreams of home ownership, and to our region's livability.

As the problem escalates, the search for real solutions has become increasingly high-stakes. To tackle this challenge effectively, we must work together with accurate information. We must also move beyond misleading and misdirected attacks on environmental and growth-management laws. The evidence suggests these attacks are misleading and unwarranted.

Opening rural areas to sprawl development doesn't increase housing affordability, nor does protecting rural areas from irresponsible development make housing unaffordable. The state's Growth Management Act actually requires local governments to take steps to improve housing afford-ability and choice.

The Brookings Institution has found that market demand, not land constraints, is the primary determinant of housing prices. Its study, "The Link Between Growth Management and Housing Affordability: The Academic Evidence," reported that "housing prices are actually determined by a host of interacting factors, such as the price of land, the supply and types of housing, the demand for housing, and the amount of residential choice and mobility in the area." In other words, the impact of growth management on housing prices is only a part of the equation, and a relatively small one here.

In our popular area, demand is the big driver of housing cost; people want to move here and stay here. Increased income and purchasing power also are major factors in the rising cost of housing in our region. Our incomes average among the nation's highest, and our relatively high local wages have helped push house prices upward as buyers have more money at their disposal to compete for housing.

New houses here are also getting bigger, another major factor contributing to the spiral. Larger houses are more expensive. From 1970 to 2005, the average size of a new single-family house in King County increased nearly 50 percent, from an average of 1,660 square feet to more than 2,400 square feet.

Large lot sizes also drive up housing costs. Very-low-density zoning (one to four units per acre) is common in cities throughout our region. Such zoning essentially excludes affordable housing and people of moderate income. Builders and mortgage lenders expect to provide large, more-expensive homes on those higher-priced large lots.

Many growth-management policies improve housing affordability by encouraging communities to offer higher-intensity housing choices. Condominiums and apartments play an important role in providing affordable-housing options. Almost 40 percent of King County households live in apartments and condominiums.

Condominiums have been much more affordable than single-family houses and provide an opportunity for many people to own their first home. Rental apartments are even more affordable. Rents actually decreased during the recent recession, although they have recently started to rise again. For moderate-income households, rental housing is still relatively affordable.

Although growth-management requirements have led many cities and counties to adopt policies that can result in affordable housing, there is still plenty of room for improvement.

Local governments should encourage alternative housing choices, such as townhouses, clustered co-housing and detached accessory dwelling units (mother-in-law apartments). These options are illegal or discouraged in many jurisdictions.

Cities and counties should adopt a higher average-minimum-density to make sure that land is used efficiently. When rezoning an area to increase intensity, cities and counties should consider requiring that some units be affordable for low- and moderate-income families.

Local governments should also provide stronger incentives for builders to construct lower-cost housing. Options include height and density bonuses, reduced parking requirements and other land-use incentives. At the same time, builders must take responsibility for providing a wider range of housing choices.

In the end, our message is simple. We must do more to tackle the housing affordability problem in our region. But, we cannot succeed unless we focus on the facts about what is really driving our housing costs. It is time to move beyond the rhetoric and work together to identify and implement strategies that actually address and improve housing choices and affordability.

Aaron Ostrom is the executive director of Futurewise, a statewide environmental-protection and land-use organization. Carla Okigwe is executive director of the Housing Development Consortium, the Seattle-based trade association of nonprofit housing developers.

Copyright © 2007 The Seattle Times Company