Affordable Housing

Here’s an article by the President of the Kitsap County Association of Realtors®. This well-written discussion of the challenges faced by homebuyers in this market, gives valuable incite to anyone involved in the process.

Guest Editorial
February 16, 2007

Legislature Must Act to Help Kitsap Families Find Affordable Homes
By Mike Eliason

Washington faces a dramatic shortage in the supply of homes that middle-income families can afford to own. Statewide, the price of homes has soared 61 percent over the last five years – far outpacing the 14 percent average increase in personal income. The result is a gap that traps many families in the rental cycle or puts them on the freeway driving to find a home that will not break the family budget. The reason for the rapid price increases is that the demand for middle-priced homes far outstrips the supply. Policy choices made by the State Legislature have produced the imbalance, so it is up to legislators to fix the problem.

Many people are inclined to believe that the private sector is responsible for the supply of homes and that the “market” will correct itself to respond to demand. To the contrary, government establishes the rules by which the private sector operates. Government decides what can be built and where. Cities and counties provide the backbone — roads, water, sewer and other essential infrastructure — that serves each home. Community planners calculate how many homes will be allowed in urban and rural areas to meet job growth and other factors. Cities, counties, and the state’s decisions about how land may be used are the single largest factor that pushes home prices beyond the reach of middle-income families.

State law requires community planners to identify enough land to meet the demand for living space that population growth demands. Living space can be condominiums, single-family homes, apartments, accessory dwelling units, and a number of other options. Unfortunately, many growth plans have fallen short of projected population needs, or they have assumed that homes can be built where reality says they can not (examples: environmentally sensitive
areas, land not served by roads or sewers, or land containing health hazards). Land that can actually be used has become a rare and expensive commodity.

REALTORS® have proposed four simple steps that the Washington State Legislature should take to ease the home-price pressure on middle-income families while protecting our natural resources:

House Bill 1727 provides the space we need to accommodate growing communities by ensuring that communities have the land capacity for homes to accommodate the projected population increases. Two other bills expand the home choices available to families by (1) increasing the accuracy of population growth figures planners use so that housing options match projected job growth (House Bill 1726); and (2) establishing performance measures to help communities gauge whether they are accurately planning for growth (House Bill 2091).

In addition, REALTORS® are proposing that the state help provide the backbone for growth’s impacts. House Bill 1361 establishes a “Growth Management Infrastructure Fund” to help communities provide the streets, sewers, and other infrastructure that communities’ residents and homes require.

Kitsap County families cannot wait any longer for the Legislature to act on affordable housing for our families, which is fundamental to our quality of life. Home prices significantly escalated again last year in Kitsap County, increasing the median price of homes to $280,000. Double-digit increases in prices are another blow to housing affordability in a county where too many families have to endure long commutes between the workplace and homes they can afford.

According to the Washington State University Center for Real Estate Research, the affordability index in Kitsap County is a paltry 58. A score of 58 means that the typical family only had 58 percent of the financial resources they needed to qualify for a mortgage on a typical home.

Every working family needs a roof over their head. Food, water, and shelter are basic needs. The demand for housing for a family does not go away just because homes are not affordable. Government land use decisions have created the gap between middle-income family budgets and runaway home prices. By acting now, the Legislature can help bring home ownership within reach of middle-income families again.

Mike Eliason is the Executive Officer of the Kitsap County Association of REALTORS®, the largest trade organization in Kitsap county.