Are City Regulations Squeezing Microhousing? (Seattle)

By Shawna De La Rosa of Bisnow Seattle. Excerpts:

"Earlier this year RENTCafé research found Seattle had the smallest apartments in the country at an average of 711 SF. For renters, microunits, small efficiency dwelling units and congregate units are market-rate alternatives to affordable housing. But developers say city regulations make their development difficult."

"The Kidder Mathews multifamily investment team of Dylan Simon and Jerrid Anderson recently released a study that claims policy changes to the of code and how they have been interpreted by building officials result in fewer congregate units and micro studios being built. Microhousing sales in Seattle averaged a price per SF that was 24% higher than that of market-rate apartments, according to the report.

Proof that regulations have dampened the market, only two micro-studio projects are currently under construction and two are in the permitting process. In contrast, SEDUs (small efficiency dwelling units also known as micro-housing) have faced fewer regulation restrictions and there are currently 3,000 units under construction or with approved plans, which would double the existing stock of SEDUs in the next two years. “Seattle’s residents have spoken, and they see microhousing [as] viable housing that offers them an affordable option to live in the best neighborhoods in our city,” Anderson said in a statement.

Neiman Taber Architects partner David Neiman wrote an article for Sightline Institute in 2017 that noted how Seattle makes it difficult for developers to build micro housing. He said his article is still relevant today. “Production of congregate housing in Seattle has been reduced from a river to a trickle by restrictions that limit the zones where congregate housing is allowed almost entirely to zones where it is not economically feasible,” Neiman said. “The situation has only been made worse by recent zoning changes passed in March 2019 that reduced the viable land base for congregate housing even further.”

All the previous energy that had been put into congregate housing has been redirected to SEDUs, but they rent for about 25% more than congregate and serve a different price range. Neiman would like to see the land zoned for congregate housing expanded. He also suggests that SEDUs be allowed to be built at 220 SF. “If you look at all the global cities in the world: London, New York City, Tokyo, Hong Kong, 250 to 350 SF is an acceptable size of an apartment,” Wong said."