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Once curbed in Seattle, tiny apartments poised for big boost from Legislature

By Heidi Groover, The Seattle Times
Published: February 23, 2024, 10:47am

SEATTLE — With around 200 square feet of their own private space, tenants at The Kärsti apartments in Ballard make a trade-off from the typical studio apartment, swapping larger sleeping areas and private kitchens for communal living and cheaper rent.

As Washington residents face sky-high housing costs and a shortage of places to live, state lawmakers hope to encourage more small apartments like these.

The Washington state Senate on Thursday approved a bill requiring cities to remove regulations that block development of small apartments with shared common spaces. The bill will now go to the House, which already unanimously approved it, then to the governor’s desk.

Also known as congregate housing, micro-apartments or single-room occupancy buildings (SROs), “co-living housing” refers to small apartments with private sleeping areas, shared kitchens, and either private or shared bathrooms. Rents for those apartments average roughly $1,100 a month in Seattle, about $500 less than a typical studio apartment, though still pricier than subsidized affordable housing.

“What we know is that without some sort of entry-level housing, a lot of people will not be able to afford a place to live,” bill sponsor Sen. Jesse Salomon, D-Shoreline, said in a floor speech.

Near-unanimous support for the bill in the Legislature stands in stark contrast to the fight that played out in Seattle a decade ago. Though SROs were common across the country in the early 1900s, an uptick in Seattle micro-apartment development in the early 2010s drew backlash from neighbors and led the city to tighten regulations on them.

Supporters of the bill in Olympia say those regulations — and others in nearby cities — have slowed development.

House Bill 1998 would require many cities and counties in the state to allow micro-housing on any lot where they already allow apartment or condo buildings with at least six units, starting in late 2025. The bill would also limit other city regulations on small apartments, including parking requirements, which can add significant costs. Cities could not impose stricter regulations on small apartments than they do on other apartments.

Although developers have continued to build small apartments under current regulations, local rules prevent them from being “a meaningful amount of housing that can actually have an effect on our housing market,” said architect David Neiman, whose firm has worked on micro-apartment buildings in Seattle and who supports the bill.

Rents at The Kärsti in Ballard range from $1,000 to $1,450, making them affordable for single people making roughly $38,000 to $58,000. The tenants are in their mid-30s, on average, Neiman said. Other buildings draw more older people, and AARP Washington backed the bill as a strategy to help more people age in their communities.

The legislation would make way for more micro-apartments in some of Seattle’s neighborhood commercial zones and low-rise zones where town homes and small apartment buildings are already allowed, Neiman said. Low-rise zones are often near busier strips, such as the Capitol Hill neighborhood just off the commercial stretch of 15th Avenue or NewHolly, a few blocks off Martin Luther King Jr. Way South.

“What we’re essentially saying is, if you can build an apartment, you can build an apartment that is also affordable for people who make less money,” Neiman said.

The bill received bipartisan support in Olympia, with some Republicans hailing it as a way to add affordable housing without government subsidies.

“When it comes to housing affordability, this is just another option,” Sen. Nikki Torres, R-Pasco, said before the Senate vote Thursday. “Unless you want your college student living with you forever and/or your parents living with you forever, I urge your adoption of this bill.”

No House members voted against the bill when the chamber approved it earlier this month. Four Republicans voted no in the Senate Thursday, including Spokane Valley’s Sen. Mike Padden, who said in a statement the legislation “dictates from Olympia policies that should be made by locally elected county and city officials.”

Other bills to boost housing

As the legislative session winds down, lawmakers are still debating several other ideas to boost the state’s housing supply.

House members OK’d a bill allowing denser development near transit, but that proposal appears to have a tougher road ahead in the Senate.

House Bill 2160 would require cities and counties to allow denser development in areas near certain transit stops, if local governments have not already upzoned those areas. The bill would require at least 10% of units in those areas to be affordable. Rentals would be aimed at people making 60% of area median income, $57,500 for a single person in King County, and for-sale homes would be for those making 80% of area median income, $71,000 for a single person.

Entirely affordable developments could tap into extra density, and the bill would prevent cities and counties from requiring developers to build parking in those transit-rich areas, except for spaces for deliveries or people with disabilities.

The governor’s office, affordable housing groups and the environmental advocacy group Futurewise are backing the bill, pointing to more housing near transit as a way to increase the supply of homes, reduce reliance on cars and prevent sprawl.

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A statewide commercial real estate group and the Washington Realtors oppose the bill, arguing the affordability mandate — the first of its kind to be applied statewide — would halt construction of new apartments near transit.

Rep. Julia Reed, D-Seattle, who sponsored the bill, said Democratic lawmakers are increasingly unwilling to back far-reaching zoning changes without affordability mandates.

“Our housing market is very unregulated right now when it comes to ensuring affordability … and we are trying to apply some modest regulation,” Reed said in an interview.

Lawmakers scheduled the bill for a public hearing Saturday in a Senate committee, which faces a Monday deadline to pass it.

Legislators are also still considering a proposal to give developers tax breaks when they convert underused office buildings into housing. But supporters have significantly scaled back that proposal since introducing it.

The bill no longer allows cities to create property tax exemptions for conversion projects. That change followed legal and technical concerns from the Department of Revenue, including that the program might violate the state constitution.

The bill would allow cities to offer developers a break on sales and use taxes when they convert commercial buildings into housing, as long as 10% of the new homes are affordable.

The bill passed the Senate with a 48-1 vote earlier this month and is now under consideration in the House. Seattle Democrat Sen. Bob Hasegawa, who cast the lone no vote, said in an interview the state should focus on funding publicly backed social housing, rather than tax breaks for private developers.

Most nonbudget bills must pass out of committees by Monday and pass the chamber by March 1. The legislative session is set to end March 7.