Housing costs have skyrocketed. However, the Seattle City Council claims to have an answer: Make housing even more expensive.
Seattle’s Mandatory Housing Affordability program (MHA), implemented citywide in 2019, serves as a microcosm of misguided zoning policies nationwide as half of U.S. homeowners and renters struggle to keep roofs over their heads.
In zones across Seattle, MHA permit conditions force Seattle property owners to pay into the city’s “housing affordability” fund before building any residential development. The per-square-foot MHA fee can amount to 20 percent of project costs.
Alternatively, people can agree to provide public housing at their own expense by building extra housing — and then renting it at below-market value for 75 years.
Neither option works for Anita Adams. After years of saving with her husband, she purchased a house in her childhood neighborhood in Seattle’s Central District, a traditionally Black community. The Adamses raised their children in that house. They now want to add a four-bedroom structure in the backyard so their adult children can stay.
Seattle’s zoning allows for this project but at a steep price. The MHA formula would require Adams to contribute $89,000 in public housing fees before obtaining the required permits. For a middle-class homeowner like Adams, this is unaffordable.
“I can’t even break ground unless I write them a check first,” Adams says. “If I do that, I’m not even going to have any money left for the house.”
Intentionally burdening housing creation during a housing shortage is counterproductive and could gut Seattle’s middle class.
When the city passed MHA, it also up-zoned areas across Seattle. Previously, Adams and her neighbors could not build extra units on their lots because the city had designated their land for single-family use. Because of the up-zoning, the city finally allowed for more units like townhomes and low-rise apartments. This is not bad; people should be allowed to use their property fully.
The problem lies with MHA’s permit requirement. The city acknowledges that the housing is expensive because there is not enough of it (hence the upzoning). Yet MHA makes it even more costly to add housing to Seattle.
Predictably, a study found that MHA channels new construction outside MHA zones as homebuilders seek to avoid its onerous obligations. The result: Less housing in the precise areas the city has identified where more housing is needed.
This also harms existing homeowners. The upzoned land has become more valuable. Property taxes — calculated according to “highest and best use” — go up. This is where ordinary homeowners are hit by MHA. Their taxes reflect higher build capacity, yet the MHA fee prevents them from using that capacity. Eventually, homeowners must sell to large developers, who will pass on MHA fees to subsequent renters.
Under this system, the only people who can afford to live in Seattle are the super wealthy or those on the other end of the spectrum who qualify for public housing.
Rather than go quietly, Adams fought back with a lawsuit in 2022. Our public interest law firm, the Institute for Justice, represents her as part of our Zoning Justice Project. Her case has merit, but the U.S. District Court for the Western District of Washington dismissed it.
The court held that Adams cannot sue until she first applies for an MHA waiver with the Seattle Office of Housing — a process that can take years and is almost certainly pointless. The city has granted only one MHA waiver, otherwise enforcing MHA across Seattle.
In October 2024, Adams filed her appeal — which seeks to strike down MHA. “This isn’t about just my property,” Adams says. “It’s about ensuring that future generations can thrive in the city they call home.”
Seattle needs more housing. The city can start by letting people build on their land without ruinous “affordability” charges.