Isn’t microhousing good because it is affordable? It depends……..affordable for whom?

I’m learning that one of the great things about blogging is that you can change direction rapidly, I decided that, before delving into eye-glazing discussion of Code definitions and characterizations, it would be better to cover two topics that always prove of interest: money and size.

The affordability of microhousing has often been the chief factor the City has pleaded in defense of it, regardless of how messy the permit process has been or how out of character with the existing neighborhood architectural context microhousing development has been. Diane Sugimura, Director of the Department of Planning and Development, went so far as to say, in a letter to Franklin Avenue Eastlake) neighbors dated June 28, 2012:

As I noted earlier, this is a non-traditional housing type, but is one which we’ve been seeing more in recent times. We recognize that this type of housing is meeting an important need by providing an affordable housing option without public subsidies.

This assertion that this affordable housing was being provided without public subsidies intrigued me. Given the emphasis the City places on public/private partnership, it was difficult to believe that anything in Seattle was built without a public subsidy. The opportunity to explore this issue further was presented when Councilmember Richard Conlin and Ms. Sugimura came to a meeting of the East District Neighborhood Council to hear the concerns of citizens irate about the proliferation of microhousing in Capitol Hill’s lowrise zones. Having previously found information at the Seattle Office of Housing that 53.48% of microhousing projects had applied for or were receiving the 12-year benefits of the multifamily tax exemption, I repeated the quote of Ms. Sugimura presented above, and asked her if she did not consider the multifamily tax exemption to be a public subsidy. Her reply: “Well, you got me.” It was good that she was so forthright in acknowledging this, but one must always wonder if she had the information I provided when she told the Franklin Avenue neighbors that microhousing was being built without public subsidies.  

Documents from the Seattle Office of Housing proved to be a treasure trove of information. Indeed one wonders why urban policy bloggers, density advocates, and mainstream media have not previously mined it. Perhaps they were just too busy, or perhaps it didn’t contain information that conveniently fit their story line. Some examples follow.

How much is the rent for microhousing?

If you relied on most of the published commentary, you would think that microhousing units rent for from $450 to $700 month, with $500 to $600 being frequently given. Your reliance would be misplaced. According to figures provided by developers to the Seattle Office of Housing, the rents range from $425 to $1,250 a month.

The monthly rent ranges for six developments are: (1) $425 to $725; (2) $600 to $850; (3) $400 to $725; (4) $525 to $790; (5) $695 to $1200; and (6) $600-$1250. There has frequently been a substantial increase in rent amounts between the time of the developer’s application for the multifamily tax exemption and the time the project is certified to receive the multifamily tax exemption. Should the developer decide to withdraw from the multifamily tax exemption program, he would be able to increase rents further. So there is no guarantee of long-term affordability with these units.

No Income Tenants

As you drill down deeper into the numbers, other interesting discoveries await. For example, 14 tenants in one building had zero income, but managed to pay their rent, as did five in another building, three in another building, and six in another building.

Poverty is relative

While microhousing units are often praised as providing housing for individuals at 60%, 65% and 85% of area median income (currently over $60,000 a year for a single individual) and for students and low income individuals, in one building, some of the tenants were at 117%, 136%, 195% and 262% of median income. Such individuals would not seem to need assistance in finding affordable housing. In one building, a tenant earning $72,000 a year was paying $650 per month for his unit, while another tenant, earning $14,400 a year was paying $675.00 for his unit, with a negligible size difference between the units. In another building, there were tenants at 107%, 122%, 125%, 134% and 136% or area median income.