No easy solution to creating affordable housing for people at every income level

About 7,965 people – that’s 22 percent of Thurston County renters who make 80 percent or less of the area median income – spend half or more of their paychecks on rent. The standard calculation is that non-millionaires should spend no more than 30 percent of their income on housing, but 14,650 local renters spend more than that. Many in this group are one car repair, one medical bill, or one missed paycheck away from the catastrophe of homelessness.

Last year, a study conducted by Zillow and the University of Washington found that for every five percent rent increase in Seattle, 250 people were pushed into homelessness. It seems safe to assume that here in Thurston County, with rising rents and a very low vacancy rate, the same dynamic is at work.

Government financed, non-profit housing helps, but it isn’t solving this problem because it is a tiny fraction of the housing market. And there are only enough federal vouchers that subsidize rent for low income people to serve one out of four who are eligible.

A real solution will require significant changes in the for-profit housing market.

To shut off the pipeline to homelessness, there is an urgent need for more “affordable” housing, priced for households who make between thirty and eighty percent of our area’s median income, which is about $66,725. This is not a market that for-profit developers and their bankers like very much, because it’s difficult for them to make profits big enough to justify the significant risks they face. So they tend to build more “market rate” (that is, more expensive) housing for the more affluent.

In the past year, a discussion began in Thurston Thrives, the county’s sprawling community health initiative, about how to beef up incentives for private sector production of affordable housing. The three main ideas that emerged are to reduce or waive impact fees, to extend property tax breaks for longer periods, and to fast-track the permitting process and perhaps reduce its cost.

How much these ideas, if implemented, would increase the supply of affordable housing supply is an open question. But even in the unlikely event that they are implemented and become wildly successful in serving the households that make between thirty and eighty percent of area median income, that still leaves out the people most in need of cheap housing – the households in the bottom thirty percent of the income pile.

Some of those in the bottom thirty percent are working minimum wage jobs, often with schedules that don’t add up to forty hours a week. Many others are people with disabilities, whose Supplemental Security Income is just $750 a month. Still others are those who are disabled by mental or physical conditions, but have not yet managed to navigate the long and complicated process of applying for and receiving disability benefits.

Until someone, somewhere, figures out how to provide unsubsidized rental housing that costs $500 a month or less, there is not much hope of solving the problem of homelessness for this population.

And until there is enough affordable rental housing to keep low-income families away from the edge of the cliff, rising rents caused by our housing shortage guarantee that our economy will continue to create more homelessness with every passing month.

There are glimmers of hope. Innovations – in construction materials and technology, the return of dorm-style housing with shared facilities, socially conscious investing, and inclusive zoning – can all play a part in driving down the cost of housing.

But to solve this crisis, we urgently need the best minds and hearts in the private sector housing industry to step up, innovate, and invest in building decent housing that even the lowest-income people can afford. And we need governments at every level to support their efforts to do so.