Josh Lehner of the Oregon Office of Economic Analysis writes about “the Housing Trilemma.” (Via Jon Talton.) As Lehner puts it,

Every city wants to have a strong local economy, high quality of life and housing affordability for its residents. Unfortunately these three dimensions represent the Housing Trilemma. A city can achieve success on two but not all three at the same time. Underlying all of these tradeoffs are local policies as well.

Indeed, some cities do achieve all three, but it’s a matter of degree—which is influenced by those local policies. Lehner looks at the 100 largest metro areas in the country: “Just eight rank among the top half for all three dimensions of the Housing Trilemma. None rank among the Top 20 in all three.” (In his Venn diagram below, Omaha, Nebraska and Des Moines, Iowa are among the cities with all three.)

Seattle (the only Washington metro included) has economic strength and quality of life, but lacks in affordability. As Lehner notes, “People want to live in cities with a strong economy and high quality of life. Increased demand for housing leads to higher prices and lower affordability.”

It may be impossible to achieve the kind of housing affordability that exists in Youngstown, Ohio if you also do well on economic strength and quality of life. But there are ways to get closer to the affordability circle while staying in the other two.

Earlier this week, Roger Valdez of Smart Growth Seattle wrote about the Seattle Housing Affordability and Livability Agenda Committee (HALA) recommendations from last year. Among the HALA recommendations were:

• “Improve predictability and timeliness and thus reduce construction costs by reforming City design review and historic review processes.”
• “Reduce the number of projects required to undergo SEPA review by raising SEPA thresholds.”

Valdez highlights the following from the report:

Long permitting processes and unpredictable timelines make housing projects difficult to develop and add to the cost of new housing. It is estimated that if significant reforms were made to Design Review and Historic Review, and improvements were made to the predictability of permitting within and between departments, total timelines for a complex multifamily development could be reduced by up to 2 months, and cost savings could total up to $4,000 per housing unit.

Others hope to approach the affordability circle by imposing rent control. The New York Times wrote last week that Silicon Valley and the San Francisco Bay area are seeing a number of rent control proposals: “Those campaigns, if successful, would lead to the largest expansion of tenant laws since the 1970s.” As the story notes, “rent control movements have already popped up in other higher-cost cities like Portland, Ore., and Seattle.” But,

Economists have an almost universally dim view of rent control because it does nothing to attack the underlying problem here, which is that more people want to live in the Bay Area and Silicon Valley than there are housing units to put them in.

As we wrote in a recent special report on rent control, “rent control is a Band-Aid, not a solution.” Rent control measures won’t bring widespread affordability.

Meanwhile, the Seattle City Council passed a bill on June 6 prohibiting landlords from increasing housing costs (rent/storage/parking) by 10 percent or more without giving 60 days’ notice or by less than 10 percent without 30 days’ notice. No increase would be allowed if the unit doesn’t meet minimum standards. The Seattle Times reported that landlords “have previously argued that it violates state prohibitions against local jurisdictions adopting rent regulations and have threatened to sue the city.”