Interest rates help but housing prices still top income

Published 11:36 am Friday, February 22, 2008

Lower interest rates helped but King County residents making the median income still cannot afford median priced housing in the county, according to a recent report.

King County Executive Ron Sims released the 2002 Housing Affordability Bulletin that cites lower interest rates as the main reason that sales of homes have remained accessible to median income families.

A 6 percent interest rate means a household making the median income could afford a home costing about $239,000, according to the report produced by King County’s Office of Management and Budget. The median price of a single family home, however, was $280,000, up six percent from last year, In 2001, those making the median income could afford a $202,000 home.

“Among the working poor, those making $25,000 or less, even the average rent for a one-bedroom or studio apartment is more than they can afford,” Sims said. Average rents for King County differ dramatically from one region to the next, ranging from $514 for a studio in Auburn to nearly $2,800 for a typical three bedroom apartment in downtown Seattle.

Despite the improvement, Sims said, “Buying a home is still out of reach for nearly 40 percent of households here in King County.

“In light of this need, we applaud the creative efforts many cities are employing to encourage and support the building of affordable housing.”

The 2002 Housing Survey, conducted by the King County Housing and Community Development Program, asked the 40 jurisdictions of King County to report on actions they are taking to improve housing affordability in their area.

The cities and King County are implementing a number of programs and policies that make it easier and more attractive for developers to build affordable housing. The new approaches being implemented in some areas include:

• Allowing five-story buildings to be built as wood-frame construction, instead of steel construction;

• Encouraging the development of accessory dwelling units, or mother-in-law apartments;

• Reducing or waiving parking requirements and/or impact and processing fees for projects with affordable housing;

• Allowing density bonuses, or clustering of units;

• Working to create cottage housing and transit-oriented developments as affordable housing choices;

• Expediting permit and design review processes; and

• Rehabilitating and preserving existing affordable housing.

The housing report shows that just 14 out of the 40 jurisdictions in King County have sufficient affordable housing stock for those earning from 50-80 percent of median income. All those 14 jurisdictions are in South King County, except, Seattle and Skykomish .