Administrative design review processes implemented due to COVID-19 are permitting housing faster. We should consider making them permanent.

Excerpt from design review document for Queen Anne mixed-use Safeway redevelopment

Washington state is experiencing an unprecedented shortfall of housing, coming short 225,000 homes between 2000–2015 to meet housing needs. The Puget Sound region is projected to add 1.8 million more people and 1.2 million more jobs by 2050, which means if we want to accommodate for growth, we cannot afford to stall building.

On April 27, 2020, Seattle City Council passed CB 119769. With COVID-19 rendering the usual community meetings unsafe and projects backing up in the pipeline, this emergency measure allowed projects subject to full design review to opt into administrative design review (ADR) instead.

Developers and builders could choose this expedited process or wait until the design review board resumed business. Under ADR, city staffers, rather than volunteer design review boards, had final approval. Public comments on projects continued through email in a 14-day window. Affordable housing projects were exempted altogether.

SDCI also implemented video or virtual inspections of approved projects, meaning that wait times for land use, permitting, and final inspections have also been streamlined as city staffers continue to work from home.

These streamlined methods meant to alleviate pressures during a health crisis show us that these same expedited processes can also help address our housing crisis.

We have the technology readily available for moving public comments and inspections onto virtual platforms, helping to mitigate costs and ultimately move affordable and missing middle housing through the pipeline faster.

What kind of benefits would a streamlined process produce?

More Affordable Housing

Unnecessary delays add up. The high cost of design review is passed down to renters and buyers alike and can have devastating consequences. Having proposals return for review and comment through multiple meetings, stalling construction for six months to two years, costs thousands of dollars for every month of delay. Multifamily projects that spend less time in design review ultimately end up being less expensive.

For an in-depth look: How Seattle’s Design Review Sabotages Housing Affordability, Dan Bertolet, Sightline Institute

More Housing Types

Exempting affordable housing projects frees up more time for city staff to look over other projects that sit in design review limbo for too long. On top of that, certain housing types, like townhouses and smaller multifamily buildings, could get faster approval processes or be exempted completely based on their size. More housing types means more housing choices means more housing for everyone.

Administrative design review shows us a glimpse of what could be an effective alternative, pending a more intensive design review overhaul in the city of Seattle. Cities looking to address rising housing costs and create efficient permitting processes could—and should—consider eliminating design review altogether.

We understand those concerned about not having a say in how their neighborhoods are designed. We know it’s important for neighbors to come together in shaping their communities. But it should not come at the expense of people having a safe and healthy place to call home.

Don't get on the wrong side of L&I. Recorded live at the March 23 Remodelers Council Dinner, L&I's own Erich Smith guides you through the rules and regulations you need to know to stay safe and fine-free.

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By Allison Butcher, Senior Policy Analyst, MBAKS

On Wednesday, January 31, the Master Builders Association of King and Snohomish Counties (MBAKS) kicked off its first general membership meeting of the year—an economic forecast breakfast presented by the association’s Sales & Marketing Council.

The breakfast took place at The Westin Bellevue and featured presentations by Metrostudy Regional Director Todd Britsch and Morgan Stanley Financial Advisor Dan Becraft, C(k)P QPFC.

Becraft touched on highlights of Morgan Stanley’s investment outlook for 2018. In short, the report states that global economic expansion delivered strong returns last year but we should not expect the same in 2018. Morgan Stanley is not anticipating a recession this year, but rather that markets will begin to normalize.

The forecast already factors in recent tax cuts, Becraft said. A look back at the U.S. stock market over the last 37 years shows that tax cuts are not correlated to market performance. In the year after President Ronald Reagan’s tax cuts took effect in the 1980s, for example, the market dropped.

Morgan Stanley Financial Advisor Dan Becraft, C(k)P QPFC (Alabastro Photography)

Becraft offered additional observations, including ways in which demographics influence a country’s economy, predictions on interest rates (he expects they will stay low and may even be cut), and more.

The biggest risk to our economy going forward, he noted, is our national debt, which stands at $20 trillion. However, China’s national debt is significantly higher. Whereas the United States’ debt-to-GDP ratio is around 100 percent, the ratio in China is closer to 460 percent. Becraft said some are speculating this could lead to a move by China within 36 months to repatriate capital that has flowed out of their country in recent years. If this were to happen, it could result in investments being pulled out of real estate in the United States, including the Seattle market, and transferred back to China.

Britsch focused on economic and housing data in the Puget Sound region and provided compelling information in his presentation as well, particularly related to the lack of future housing inventories.

Britsch’s presentation highlighted the fact that population and job growth continue to be very strong in the Puget Sound region, with 137,000 jobs added since 2015 and continued low unemployment in King and Snohomish counties. Furthermore, data from the Department of Licensing show that net driver in-migration into the region has averaged more than 6,300 per month since 2012, for a total of 460,000 new drivers from outside the area.

Metrostudy Regional Director Todd Britsch (Alabastro Photography)

Britsch also stressed that housing supply is not keeping up with demand. Looking at the driver license data, he estimates this growth has created a demand for 100,000 owner-occupied homes between 2012 and 2017. However, during this time, we have built and sold roughly 60,000 homes, creating a housing supply shortfall and causing upward pressure on home prices. The average list price for new construction within formal subdivisions, Britsch stated, has risen 20 percent in Snohomish County and 24 percent in King County year over year.

Britsch warned we are running out of land at a rapid pace. With 10 months’ supply of vacant developed lots in Snohomish County, he said we’re at "crisis level" in terms of lot inventory. The North Creek market area, which has been very robust in recent years, has dried up, Britsch said.

Since 2009, the entire Puget Sound region has had a net loss of 3,018 lots coming out of the system, not to be replaced. More importantly, in that same time frame, the available finished lot inventory has declined by 17,879. Britsch also pointed to Northwest Multiple Listing Service data, which shows King and Snohomish counties have just over a two-week supply of homes for sale.

Although the current housing market is showing signs of weakening, Britsch believes it will remain strong. The housing market is all part of a cycle and we can expect an adjustment in sales, he said. Britsch predicts core areas from King County to South Snohomish County will continue to see double-digit appreciation due to lack of inventory.

Founded in 1909, the Master Builders Association of King and Snohomish Counties (MBAKS) has grown to become the largest residential homebuilders association in the United States. With 2,900 member companies, the association is dedicated to membership value, housing advocacy, community service, and financial stewardship throughout the Puget Sound region.