Affordable housing in Seattle: Do we need to learn from Dallas?

Former Seattle Mayor Charles Royer recently went public with a new group, the Middle Income Housing Alliance of Seattle, aimed at dealing with the most obvious problem facing the region: it's getting too expensive to live here. But how likely is success in dealing with such a huge issue? For starters, a lot of people are perfectly happy with the high cost of real estate -- that's their retirement bonanza. Next, it proves very hard to enact middle class relief when matched against the needs of the poor, who also can't afford housing. So far, Seattle has only addressed low-income housing, despite some kind words about middle class (usually called workforce) woes. For a clear-eyed analysis of a deeper problem, I commend "A Tale of Two Town Houses," by Virginia Postrel in the November Atlantic. Postrel makes it clear that cities such as Seattle are consciously making it very hard to build more affordable housing for a variety of good and politically popular reasons -- protecting the neighborhood, preserving old homes, beating back unsightly apartments, and other green causes. The cost of what she calls "the right to build" goes through the roof in these cities. By contrast, a city such as Dallas has no affordability crisis for the simple reason that as demand for housing increases the developers just build more. Prices stay roughly the same in both the city and the suburbs. Postrel's tale of two cities describes how she bought a town house in an attractive part of Dallas, sold it after seven years at a slight loss, and moved back to LA where the town house she had kept had roughly doubled in price. She then generalizes about these two kinds of cities: Dallas and Los Angeles represent two distinct models for successful American cities, which both reflect and reinforce different cultural and political attitudes. One model fosters a family-oriented, middle-class lifestyle–the proverbial home-centered "balanced life." The other rewards highly productive, work-driven people with a yen for stimulating public activities, for arts venues, world-class universities, luxury shopping, restaurants that aren't kid-friendly. One makes room for a wide range of incomes, offering most working people a comfortable life. The other, over time, becomes an enclave for the rich. Since day-to-day experience shapes people's sense of what is typical and normal, these differences in turn lead to contrasting perceptions of economic and social reality. It's easy to believe the middle class is vanishing when you live in Los Angeles, much harder in Dallas. These differences also reinforce different norms and values–different ideas of what it means to live a good life. Real estate may be as important as religion in explaining the infamous gap between red and blue states. The Dallas model, prominent in the South and Southwest, sees a growing population as a sign of urban health. Cities liberally permit housing construction to accommodate new residents. The Los Angeles model, common on the West Coast and in the Northeast Corridor, discourages growth by limiting new housing. Instead of inviting newcomers, this approach rewards longtime residents with big capital gains and the political clout to block projects they don't like. The direct results of these strategies are predictable: cheap, plentiful housing in some places, and expensive, scarce housing in others. A remodeler working on my L.A. town house a couple of years ago wistfully recalled visiting a cousin in Arlington, Texas, between Dallas and Fort Worth. He wanted to move there himself. In Arlington, he said, "you can buy a million-dollar house for $200,000." According to Coldwell Banker's annual sur vey, a 2,200-square-foot, four-bedroom "middle-management" home costs around $141,000 in Arlington (or, for big spenders, $288,000 in Dallas), compared with $1 million or more in the L.A. area. One man's million-dollar dream home is another's plain old tract house. Postrel produces some figures for the average "right to build" on a quarter acre in key cities. In San Francisco, the highest rate, it's $700,000, the kind of ante you put in to get legal permission to build a new house. LA is about half that, and Seattle is a little over $200,000. Dallas is around $50,000. Add high land prices and expensive construction costs and you have pretty much sent the mobile middle class out of the state. Wharton School economist Joseph Gyourko calls these expensive cities "superstar cities," where the rich bid up the price of everything and they have the clout to "control the heck out of land use." Seattle and even many rural counties are very much on this train, aiming at the LA model rather than the Dallas model. It's hard to see how Royer & Co. can turn this train around, but it's great that they are trying to.