Following a continued trend of cost of living increases throughout the metropolitan area, which saw Seattle overtake San Francisco for largest rent increases in the nation last year, Apartment Insights Washington reports that the average cost of an apartment in Seattle has now jumped by 4.1 percent in the second quarter of 2014 to $1,441 per month.
New York real estate monitoring firm Reis also reports that the average asking price for apartments in the metropolitan area has grown by 4.2 percent to $1,233 per month. Capitol Hill, which leads the city in overall cost of rent, the average price asking grew by 12.9 percent in 2013 and a further 1.3 percent in the first quarter of 2014, making the average cost of an apartment on the hill $1,733 per month.
Councilmember Kshama Sawant, who called for a greater focus on rental costs during her campaign last year, told The Capitol Hill Times that the rental increases represents a “crisis point” for the city that pushes lower-income workers further away from their jobs, compounded by recent cuts to mass transit and rising costs for maintaining a vehicle.
“Because the economy is doing well against the nation average, you see more housing units being developed, but at the same time you see more and more problems of affordability,” said Sawant. “This is a fundamental failure of the market. Housing is a human right. How is it that in one of the wealthiest cities in the world in the 21st century that we’re still talking about how to provide decent quality housing to hundreds of thousands of people that make the city run but don’t have a decent place to go home to and raise their kids in?”
While the overall vacancy percentage for the Seattle area has dropped, the areas of town which boast the largest rental increases, such as Capitol Hill and Ballard, have seen a sharp rise in vacancies for both new and old units. The first quarter of 2014 shows a current vacancy percentage of 7.2 percent for Capitol Hill, up 1.3 percent from the same time last year. Ballard, which has seen the largest percentage increase this year, now has a vacancy rate of 18 percent when recently opened apartments are taken into account.
“Ballard’s rental situation runs counter to the very simplistic argument by many that say it’s an issue of demand and supply, and that the issue of rental increases comes from a lack of supply,” said Sawant.
“The issue isn’t that we aren’t having enough units built, it’s a question of what kinds of units are built and who can afford them. It’s almost as if there’s two cities and two different markets; one that services higher-income clientele, and one for the majority of people. This is not about the poorest people either. Even those who consider themselves middle-class are finding it difficult. The outcome of the current crisis is going to be exactly the same as the bubble we saw in 2008. If you have a situation where more and more goods are being produced, but you don’t have a buyer for those goods, that’s a bubble in the making, and it’s inevitable that it will come to a screeching halt.”
According to Sawant, the best options for increasing affordability is a strengthening of the existing incentive zoning laws, higher development impact fees, stronger taxation for developers, and rent control. Sawant also said that another avenue to explore is the creation of more public housing, built and owned by the city, as a means of providing affordable apartments to working and middle-class residents.
“If you look at some of things that people like Councilmember Nick Licata have already suggested like mandatory incentive zoning, where whenever new units go up, the number of affordable housing units also goes up,” said Sawant. “We have gotten some incentive zoning, but it was a very watered down version of what we were fighting for. It’s a very simple thing that can be done, but it’s not simple from a political standpoint because you have all these business interests stacked up against you.”
Sawant added that the solution would require a grassroots movement similar to the one that pushed for the increase of Seattle’s minimum wage to $15 per hour, and pointed to the success of that effort as a sign that Seattle residents can bring about the political change necessary if they fight hard enough for it.
“The benefits of having a victorious mass movement are tremendous, it has raised the confidence of the working people,” said Sawant. “It’s necessary for ordinary people to step outside of the logic of capitalism and understand what the real solutions to these problems are that we can fight for ourselves. And I use the word fight because you can’t simply go to the developers and convince them to change things,” she said.
“You have to have a political struggle, and these questions have to be translated into that arena. We have real ideas for how this crisis can be solved, but we’re going to need a mass movement. And people have seen this work, they’ve now had a taste of success. They can see that when you organize and build a movement, you can win.”