As reported by KOMO 4 NEws: In the greater Seattle area including King, Pierce, and Snohomish Counties, one out of every 129 homes has received a foreclosure notice. Nationally that number is one out of every 339 meaning that Seattle is facing more than double the average foreclosure rate as the rest of the nation.
Dear Councilmember,
Today's shocking headline confirms earlier forecasts by experts; the Seattle real estate market is hardest hit in the U.S. in 2010 and unlikely to recover in 2011.
It is imperative that city leaders take action to eliminate development incentives which artificially stimulate the Seattle real estate market. Leaving in place the lucrative development incentives will expand the supply of housing, prolonging the housing crisis, increasing downward pressure on property values, reducing personal wealth, and resulting in a loss of tax revenues to the city.
Seattle housing prices have fallen more than 30 percent since 2006. The steep decline in property values is due, in part, to an over-supply of housing units. There is a silver lining to lower property values; all Seattle housing is more affordable. Rising affordability is the result of a declining market, not through give-away's to the development community. In the current economic climate, the real concern is that development incentives may further erode property values by continuing to incentivize developers to build, adding to the supply of housing units for years to come.
Development incentives create a windfall increase in the profit's of private developers and allow non-profit developers to grow lazy and bloated with overhead (as in the case of HomeSight). While development incentives enrich the developer, there is only a token contribution toward the creation of genuine "affordable" housing. Stimulating new development results in a pattern of raze & redevelopment which wipes out existing affordable units while creating new housing that is always LESS affordable. This is the case in Rainier Vista and New Holly, to cite just two examples. In short, the cost of development incentives is too great, the pay-back is too little, the new housing is always MORE expensive, resulting in a net LOSS of affordable housing.
As has always been true, supply & demand will regulate the market. Right now, Seattle has an over-supply of housing units. Please end Incentive Zoning and the Multi-Family Tax Exempt Program, and restore the parking requirement for all new construction citywide. This will result in balance and stability in the Seattle real estate market, and equal treatment of all neighborhoods. (Eliminating parking penalizes low-income communities disproportionately, leaving poorer neighborhoods with no parking, while developers in middle-class neighborhoods will always provide parking, whether or not parking is required by the city.)
Seattle is not the first city to experience growth and the evidence seems to indicate that city leaders too quickly acquiesced to pressure from developers. Seattle should be allowed to evolve ORGANICALLY, not artificially, with a focus on preserving our unique quality of life. Instead, city leaders have been narrowly focused on one goal; increasing density. Density is not equal to affordability. Eliminating artificial incentives will bring balance back to growth patterns, improve Seattle's tax revenues, and reduce the financial burden of incentive programs which benefit a handful of developers at the expense of higher utility rates, property taxes, and fees for every property owner in Seattle.
Seattle leaders have been scrambling to fill a huge hole in the budget by raising taxes and fees. There's no money for street repairs, police hiring is on hold, and community centers are threatened with closure. In the worst recession in 80 years, can Seattle's leaders continue to support the subsidizing of new development, enriching an exclusive group of developers, and sticking every Seattle taxpayer with the bill?
Please stop the madness.
Ray Akers
Realtor, 25+ years.
[[In-content Ad]]
