Families struggle to own homes - Lack of "buildable"
land, fees and regulations add tens of thousands of dollars to new-home
A recent article in this paper [Bellingham Herald] entitled "Housing costs cripple low-wage families" is mistitled. The headline should read: "Housing costs cripple most families." Sky-rocketing demand and a limited supply of homes is pushing prices out of reach - not just for low-income families, but middle-wage earners as well.
In fact, home prices in Whatcom County have risen by approximately 14 percent since 1995. That's far more rapidly than the county's median income, which was $41,300 in 2000. In fact the wages of most middle-income families haven't risen at all during this recession.
Taxes, fees, regulations, and low supply work together to increase the price of housing. According to the Washington Research Council, taxes and fees add as much as 10 percent to the price of a home; regulations an additional 10 percent to 20 percent. Governments tack on "impact fees" to pay for schools, roads and other public services. And there are fees for parks and recreational areas. Combined with sales and property taxes, and real estate excise and B&O taxes, fees can add tens of thousands of dollars to the price of a new home.
Time is expensive in land development, so it's not surprising that the time it takes to get local, state and federal permits adds substantially to the price of new homes. Builders must know and comply with requirements of the federal Clean Air and Clean Water acts, the Endangered Species Act, and the state's Shoreline Management and Environmental Policy acts. They must determine whether local zoning allows the style and kind of house they've planned. After wading through all that, would-be neighbors may oppose a project and lengthen the permitting process.
Another factor that adds to the price of a home is simply the availability of land. A number of forces combine to make buildable land one of the scarcest - and hottest - commodities in our economy. Land set aside for "open space" and "critical areas" reduces acreage available for building. The state's Growth Management Act requires building to occur where homes and buildings already exist - in urban areas where land is, by definition, in short supply. The result? Escalating home prices in Whatcom County.
What can be done to improve housing opportunities in Whatcom County? A good start would be to estimate now how much and what kind of housing we'll need. Next we must determine whether essential ingredients for new homes are available. That recipe includes buildable land and the roads and other infrastructure needed to deliver basic services such as sewer, water and electricity to homes.
Regulations can help direct and maintain the quality of development - or strangle it. Communities should make certain that regulations are encouraging housing diversity and new-home opportunities. Governments should review the permitting process to ensure that it can process applications efficiently.
Finally, like any good business plan, a community's housing plan should include clear ways to measure performance and meet goals. That means a clear statement of results and benchmarks.
There's already a severe shortage of housing opportunities for Whatcom County residents. If we do nothing it will only get worse. Shortsighted growth-management plans push up home prices and exacerbate sprawl as people look for affordable homes farther and farther away from where they work, shop and play. The only way to make the GMA work is to ensure affordable housing is available where and when people need it.
Reducing barriers to affordable housing will enable more first-time homebuyers to realize the dream of home ownership. That contributes to a vibrant economy, builds better communities, and gives individual families a stake in where they live.
Local governments have to be more willing to revise their zoning codes and streamline the permitting process to allow a broader range of housing types. Providing more flexibility in our land-use laws would allow for the innovative housing and quality neighborhoods that people want.
We can create new opportunities for home ownership in Whatcom County. But it will take courage to change old systems, and vision to plan for vibrant communities for living and working.
Mike Flynn, a Gig Harbor resident, is president-elect of the Washington Association of Realtors.
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