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How single-family zoning and regulatory fees lead to high housing costs in Seattle

A Redfin real estate yard sign is pictured in front of a house for sale in Seattle, Washington. (Photo by Stephen Brashear/Getty Images for Redfin)

The chief economist for Windermere, Matthew Gardner, says Seattle has to get past the single-family zoning mindset that it has had really for most of its existence as a city. It’s something Dori Monson completely disagrees with, so Gardner joined the show to discuss.

Dori noted that when he was a kid, he grew up in a distinctly single-family zoned neighborhood, and that even though it wasn’t the greatest house, he and his friends benefitted from being able to play in backyards.

“So why in the world is there this desire to upzone so much of Seattle and get duplexes, and fourplexes, and more apartments?” he asked.

“Well, I think that it’s great to know that, as a youngster, you have plenty of space around. The trouble is we continue to have more people moving here than moving away,” Gardner responded. “In fact, the last time we actually lost population, I believe was after the Boeing bust of 1972. We have a lot more people here and, naturally, we’ve got a lot of mountains, a lot of water, and not a whole amount of land because of that.”

Gardner says single-family zoning may have worked for a time in Seattle, but we’ve got to move beyond it.

“I think zoning was created here back in the late 1930s, I believe, and it probably made sense then, as it did through the 70s,” he said.

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“But as we continue to see more and more people moving here, as we continue to have a mass transit infrastructure, which is stretched beyond belief, then what that does is that home prices or even rents closer to the job centers get higher. They do that because there’s a value to our time,” he said.

Dori suggested that single-family zoning isn’t the only reason why Seattle has some of the highest housing prices in the country. Government plays a role, too.

“A Syracuse University study says Seattle city government adds more to the cost of housing than any city in the country. … Why don’t we address that before we start chipping away at the character of the city?” he asked.

“Well, I mean, you’re absolutely right. As much as I say that we need to get greater density, it’s not going to happen overnight,” Gardner responded. “Part of the reason — and you are quite correct in that making the statement you just did — is our regulatory fees and costs, on average, in America is about 25 cents of every dollar spent to build a home, of fees.”

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“And, actually, multi-family — either condominiums or apartments — it’s above 30 cents,” Gardner said. “So when you combine those regulatory fees with the land costs, which are extraordinary, again, because we have a finite supply of it. Then we look at labor costs. No one’s going to vocational school. Then we look at material prices — lumber’s gone parabolic, over the course of the last less than a year was up 170% — so in all, it’s very expensive to build, and that obviously means the home itself is going to have to be expensive.”

Listen to the Dori Monson Show weekday afternoons from noon – 3 p.m. on KIRO Radio, 97.3 FM. Subscribe to the podcast here.

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