What Is Being Built Next To Me? Down The Street? And Over There?
I started looking into this when a tiny steep lot across and down the street from me had surveyors appear in front of it a couple of years ago. We’ve watched the structure go up—it’s wide, tall, and somewhat out of place (in my opinion). A few years prior, we had tried to get a variance to add a small studio below an existing structure on our lot, and our proposal was flat-out denied by the city. Now there was a house that would be 2 stories higher than ours and it seemed to be breaking every rule I had believed was extremely difficult to bypass (i.e. encroaching upon boundary setback lines, building on steep slopes, exceeding the 35′ height limit).
Over the past few years, lots of new rules have changed to allow more density and reduce massive houses in Seattle. Seattle has become very expensive, at least in part due to the city’s growing tech businesses, and existing residents simply can’t compete against the high-salaried workers moving to the region. This has contributed to an affordability crisis.
Looking at the above chart, courtesy of David Drake & Associates, median rents in just the last five years have increased by about $600 per month. And, there’s less inventory now than ever. The lack of rental inventory is, in part, due to the mass exodus of local “mom & pop” landlords during and after the pandemic; which was caused by the difficult financial pressures placed upon landlords, put in place by the City to aid the numerous people being laid off.
Despite talk that everyone is leaving Seattle, statistics show more people than ever moving into the city and therefore, a major need for more homes. To create more affordable housing, new and revised regulations have popped up to allow increased density on single-family lots, anywhere from encouraging increased density within a single-family lot to a push for 4- to 6-plexes throughout the city. A single-family homeowner can now potentially create up to three units (and the ability to sell each one individually) on their lot. These are identified as ADUs (Accessory Dwelling Units) when it is an apartment with a separate entry that’s a part of the main home, or DADUs, (Detached Accessory Dwelling Unit) when talking about a separate building, like a backyard cottage. While there are guidelines, the barrier to entry is low. So, we are seeing a large increase in this type of construction/remodeling of a single-family lot. By creating a secondary apartment within your home, and a detached unit on your property, one lot becomes three housing units. To sell each one individually, you’d have to create some type of association (similar to an HOA). And, additional parking is no longer required.
For those within the city of Seattle, you can search by address to find out the very basics of a project happening on your street, which milestones it’s achieved, and if the project has been completed.
Most recently, across the state, zoning legislation has been adjusted to allow for more multi-family buildings. Specifically in Seattle, areas near major transit stops will be permitted to build six-plexes, and other areas have four-plexes and duplexes. Seattle City Council still needs to work on updating the comprehensive plan before it goes into effect, and that has been a challenge. The only areas that will be exempt from the increased density will be communities that have associations in place with language excluding more than one home per lot.
Once a plan is approved (expected fall of 2024), it’s unlikely we’ll be seeing construction pop up immediately. While it will be gradual, the housing landscape of Seattle is changing, so be prepared. Trends indicate an interest in living in the city, and inventory for both homes for sale and homes for rent is low. Developers are starting to scope out property near major planned and existing transit hubs. Builders like Cast Architecture have provided examples of what they would build to help fill the missing middle home gap. The City of Seattle is doing what it can to encourage increased construction within single-family lots with faster approvals of permitting and pre-approved designs. We found three projects going up within a five-block radius of View Ridge Playfield.
While inventory continues to be an issue in our hyper-local market, time will tell whether these new zoning restrictions will ease the problem or simply create different issues for existing homeowners. We’re staying on top of this—as global real estate advisors, we’re always here to help dissect the headlines and assist with your real estate needs.