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July 2016

Bellevue embarks on multi-pronged initiative to address "sizable affordable housing problem"

Bellevue Community Education ForumRecognizing it has a "sizeable affordable housing problem," the City of Bellevue has embarked on an Affordable Housing Strategy project with the twin goals of addressing the challenges and becoming a regional leader in the effort.

To help lead its initiative, the city formed a 15-member Technical Advisory Group (TAG), established 11 guiding principles, created a project website, and hosted a Community Education Forum.  By October, the city plans to solicit public comment on a draft plan.

TAG members represent diverse backgrounds and knowledge of housing, financing, development, and affordable housing concerns. The group is charged with "fashioning a framework for evaluating a range of actions to increase opportunities for affordable housing."

One of the members of TAG is Michael Orbino, representing Seattle King County REALTORS┬«.  The third generation Bellevue resident is a managing broker at John L. Scott's Bellevue Main office and an active member of SKCR, including serving as 2016 VP-Elect of Governmental & Public Affairs.

From the outset, the Bellevue City Council recognized the importance of providing a safe, healthy and affordable place to live for people of all income levels "in order to sustain Bellevue's livability and economic vitality." Four segments were singled out:

  1. Young persons in college or just entering the job market;
  2. First-time home buyers or new employees who are ready to purchase a home;
  3. The aging population, especially those on fixed/limited income, who wish to remain in the community; and
  4. Families with children that need rental and ownership options in opportunity areas.


Council members also expressed a desire to preserve the integrity of single-family areas, a property type that proves to be increasingly out of reach for many families. Figures from Northwest Multiple Listing Service show a median price of $950,000 for single family homes that sold during June.

At its Community Education Forum held in late June, eight panelists from different stakeholder groups discussed various aspects of the affordability challenge.

Two underscore the challenge, both councilmember Lynne Robinson and city planner Michael Kattermann cited findings from a 2015 Survey of Businesses as well as a 2015 Human Services Needs Update. More than two-thirds (68 percent) of survey respondents rated lack of affordable housing as the No. 1 community problem, up from the 2013 figure of 51 percent. All business sectors rated Bellevue low on affordable housing options, with workforce housing identified as the primary challenge.

The city's research reiterated the challenges of maintaining ownership costs at the typical guideline of 30 percent of income. One chart displayed at the forum indicated household income of more than $160,000 is required to afford median priced home of $777,500 (based on January figures).

Echoing that concern during the well-attended forum was Dr. Jeff Thomas, executive director of human resources for the Bellevue School District. Enrollment is increasing at the rate of 2.5 percent annually, which translates to a need to hire 150-200 new staff per year for the next five years. Thomas reported the district's starting teacher salary for 2016 is just above $48,000, and noted the first-year turnover rate for new teachers is 23 percent, with many citing housing costs as a deciding factor.

Also taking part in the forum were representatives from The Sophia Way (dedicated to helping end homelessness for single adult women in King County), Redfin, Imagine Housing (the Eastside's leading developer of nonprofit housing), the King County Housing Authority, and Security Properties (a multi-family developer, investor and operator). In his prepared remarks, Michael Nanney, director of multifamily development at Security Properties, discussed affordable housing from a private sector perspective and showed examples of some of the affording housing units from its portfolio of 6,000 apartments. He noted the uncertainty around the duration of a program (usually 8-to-12 years) will cause financial partners to view it skeptically. Investors and lenders have a minimum yield for participating in a project, he told the audience, so when onerous fees, impact mitigation charges, program exit fees and penalties are imposed a project's viability is diminished.

All presentations including a video of the panel discussion are uploaded on the city's website.

The affordable housing initiative is an outgrowth of Bellevue's updated comprehensive plan, adopted by the council in August 2015.  That plan anticipates growth of 15,800 housing units and 51,800 jobs by 2035. It expects the vast majority of growth to be accommodated through redevelopment downtown and in other mixed-use centers such as in the Spring District, a 36-acre "urban neighborhood" that will add more than 300 apartments to the housing stock, and in the Eastgate/Factoria area. The updated plan replaces one adopted in 2004.