Mandatory Housing Affordability does not make housing affordable

Seattle has MHA zones, and yet rent is what it is. Case in point.

But if you’d like more evidence than that brute observation, a recent study goes further, finding that housing permits declined in MHA zones in Seattle, while they increased in non-MHA zones. This is effectively a non-result, or a negative result, spitting into the supply-vs-demand wind:

While the metro area population has grown by 30 percent over the past two decades, Seattle is building fewer new units per year than when it had 1 million fewer inhabitants. As a result, since 2000, median house prices have nearly tripled; one in seven residents is severely rent burdened.

The core cause of unaffordable housing is there not being enough housing.

Mandatory Housing Affordability centers on a requirement that a certain percentage of units in new residential buildings be provided at below-market rates to lower-income residents. This requirement is coupled with a relaxation on restrictions to the density of developments.

The goal is noble, but by imposing a costly requirement on developers, MHA drives developments into non-MHA zones, and possibly prevents some developments ever getting off the ground.

The MHA zones were presumably zoned with an affordable housing requirement out of a desire to provide affordable housing in that geographical area. Now, perversely, the MHA requirement reduces the new housing actually built in the MHA zone, likely contributing to housing costs in that area.

Whatever makes sensible housing developments illegal to construct makes housing in general less affordable, by making there be less of it.

If there were more housing to choose from, people wouldn’t have to pay as much – as recently happened in Austin, TX after a glut of new housing construction.

Every restriction on housing construction is also, de facto, a restriction on the so-called “wrong type of people” moving into “our” neighborhood – which explains much of their popularity. Zoning laws were the original vehicle of redlining, and still reinforce de facto segregation by preventing different sorts of housing from coexisting in the same area.

That same concern over “preserving the character of the neighborhood”, I expect, is behind the startling fact that 98% of developments in Seattle MHA zones chose to pay into an affordable housing fund rather than actually providing affordable units.

In a sense, affordable housing mandates like MHA are trying to artificially reintroduce interesting heterogeneous neighborhoods, made illegal by zoning’s introduction 100 years ago, replaced by the sameness of the zones.

Without restrictions like minimum lot sizes, a wider range of plots sizes and thus housing types and levels of affordability could possibly coexist in the same neighborhood.

Minneapolis has pioneered such reforms, with good results, and Washington is following that lead (and Oregon’s and California’s) with HB 1110 allowing duplexes, triplexes, and quadplexes in most neighborhoods, and HB 1337 allowing more accessory dwelling units.

HBs 1110 and 1337 tackle the root of the affordability problem by making less housing construction illegal – i.e. allowing a greater quantity of sensible housing to be built. Many more reforms of that sort can, and should be made soon.

Increasing housing supply is the only path toward actually making housing affordable. A proper respect for material reality, rather than misguided mandates, will pave the way.



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