As Region Faces Shortage, Seattle Needs to Preserve its Existing Housing 

According to a 2024 report on housing production from Up For Growth, the metro area encompassing Seattle, Tacoma, and Bellevue is facing a shortage of 71,060 homes. That amounts to 4.2% of the region’s total housing stock. While the production of new homes is vital to closing the gap between supply and demand, so is the preservation of existing housing, especially affordable housing.

A recent op-ed in the Seattle Times called on Seattle Mayor Bruce Harrell to suspend the city’s winter eviction moratorium, a law that halts evictions for the nonpayment of rent from December through March every year. The article is authored by Sharon Lee, executive Director of the Low Income Housing Institute (LIHI), and Emily Thompson, a partner at GMD Development. LIHI owns or operates 3,400 affordable housing units in the Puget Sound region, and GMD Development has developed 923 affordable housing units in the Seattle area.

Both housing providers say the moratorium, along with the backlog of eviction cases, “leaves housing operators in a precarious financial position” that “undermines the viability of affordable housing in Seattle.” LIHI and GMD say there are many providers with properties “on the verge of financial collapse.” This fact is corroborated by public record of 24 housing provider applications for emergency funding from the city. 

LIHI faces $1.9 million in unpaid rent, despite the fact that, according to LIHI’s application for funding, the “vast majority” of tenants who don’t pay rent “have sufficient income to pay but choose not to.” 

Similarly, GMD faces $842,000 in unpaid rent of current residents, and residents who moved out with a balance exceeds $597,000 in 2024. In total, that’s over $1.4 million in unpaid rent. GMD wrote in their funding application that “without other resources to support property needs, we will go bankrupt and have to return these properties to the lenders who may foreclose.” 

“We are at a breaking point,” say Lee and Thompson, and they urge city leadership to roll back the winter eviction moratorium so that tenants with income must pay. That Seattle’s affordable housing providers are “on the verge of collapse” does not bode well for the metro area’s 71,060 housing unit shortage — a number that grows when existing housing is lost. Add in the Washington State Department of Commerce’s recommendation that more than one million new homes be built in the next two decades, and the situation is even more dire.

It will cost a minimum of $450 billion to produce one million homes in the next two decades, half of which, according to the Department of Commerce’s Five Year Plan, must be affordable to “households making less than 50% of the median family income.”

To put that need in context, the state’s affordable housing fund provided $729 million in the 2021-2023 budget cycle. Even if the state were to provide $1 billion in funding for the next twenty years, the total funding would comprise a meager fraction of the $450 billion needed. The dearth of public funding in relation to the need makes it clear that the private sector plays a crucial role in Seattle and Washington’s housing future. It also makes it clear how important the preservation of existing housing is. 

Both of these vital factors — the dependance on the private sector for the creation of new housing, and the need to preserve existing housing — are missing from a recent motion passed by the King County Council. On November 12, the council passed 8-1 a motion to develop a plan to take on at least $1 billion in debt capacity to build “permanently rent-restricted” housing. The aim is to build “workforce housing” where the cost of rent covers development and operating costs and only increases “to reflect interest rate changes” and increases in operating costs.

Considering that an inability to collect rent is devastating Seattle’s affordable housing industry, the financial viability of King County’s $1 billion housing endeavor seems precarious. It would be wise for the council to pay attention to the growing concerns among existing affordable housing providers like LIHI and GMD. The collapse of even a few large housing providers could negate anything hoped to be gained by the government taking on debt to fund housing units. 

A better approach would be for elected leaders in Seattle, King County, and the Puget Sound region as a whole to remove policies that threaten the future of affordable housing and to incentivize the development of new housing for all levels of income. Ending the winter eviction moratorium so that providers can collect rent and cover their operating costs is an obvious first step.