I live in Bellevue, WA., the 5th largest city in the state (east of Seattle across Lake Washington). About a week ago Governor Jay Inslee spoke to the Master Builders’ Association. Here are a few highlights from the meeting as reported by the local paper, The Bellevue Reporter.
Matthew Gardner, Chief Economist with Windermere Real Estate stated, “Cost of living is the most important thing to look at . . . If it becomes too expensive to pay employees a wage with which they can buy housing, they will start looking somewhere else.” This statement set the tone for the meeting, affordable housing is the number 1 issue for the region.
The region specifically addressed by those in attendance focused on Puget Sound, a few counties in Western Washington which include 6 out of the top 10 largest cities in the state. However, when Governor Inslee spoke he made certain to emphasize that his remarks applied to the entire state. He said, “This is not just a Seattle issue, this is a statewide issue. Rental costs are going up in Yakima and Spokane [eastern WA} as well.” He added, “More than one third of households are housing cost burdened and 15% are paying more than 50% of their household income on housing.”
Inslee continued, “. . . more than 43,000 new housing units would have to be constructed annually to keep up with demand.” The Puget Sound region is well short of that number.
I don’t know if the same conditions prevail in other markets where LGIH is developing communities, but this unfortunate condition in the Puget Sound region bodes well for LGIH here, especially with their strategy of appealing to first time buyers.