Stuck in the Middle: Affordable Housing is Easy to Legislate, but…


One of the selling points for HB 1110, the legislature’s radical bill encouraging middle housing, was that the concept is not radical at all. Rather, we are just returning to the old days of less restrictive zoning, when various housing types could co-exist in neighborhoods. Central Seattle was mostly built out in the early part of the 20th century, before any real zoning was in place. The result is a wide variety of housing types sprinkled around what are otherwise single-family neighborhoods. Middle housing is Back to the Future.

That does not mean that this desired housing will happen. It is one thing to pass a state law mandating that cities adjust their zoning codes to allow middle housing in single-family areas. It is quite another to get that housing built. Lots of pieces have to fall into place, many of which are outside the purview of the government. The guidance being provided by the Department of Commerce is coming from architects and planners, and it focuses on design issues. Almost nothing is being said about middle housing as a business.

The fundamental challenges concern scale. To make any difference in the overall shortage of housing in our region, we need to see a whole lot of middle housing constructed and scaled up. We are just about out of land for single-family homes within the urban growth areas of King County, so the only way to get more of the ground-related homes that most people want will be to squeeze them into existing neighborhoods, mostly onto parcels with existing homes. This means lots of small projects scattered around wherever suitable sites become available.

“Getting to scale” raises a number of issues:

Small builders for small projects

The homebuilding ecosystem used to include a wide range of builders and subcontractors. High-volume developers and homebuilders put in vast subdivisions and sprawling apartment complexes with armies of well-coordinated specialty contractors. At the same time, small and medium sized builders would fill in the spaces, often with the kinds of low-cost homes and small apartments they could finance.

Over the past few decades that ecosystem has shaken out, with small builders of low-cost homes finding land prices, financing, and regulatory burdens prohibitive. At the same time, many regional builders were getting absorbed into national firms. This shakeout has left us with the question of who exactly will build the new middle housing. It will not be difficult for boutique builders to put up $1.5 million townhouses in Kirkland, but to get to scale and do something about affordability, we will need lots of $450,000 duplexes in Federal Way.

Small infill projects used to be the province of the kinds of small builders who have become scarce. Can we get them back? Can we get volume builders interested in small, scattered projects?

Small scale is expensive

Construction still benefits enormously from economies of scale. Large subdivisions and master-planned communities run to thousands of homes, with builders using factory methods to churn out a handful of home designs at an amazing pace. Subdivisions have gotten smaller, but basic building methods have not changed much, so homebuilding still benefits from scale. 

Subcontractors working in large developments will accept lower payments in exchange for guarantees of months or years of work. But as anyone who has ever done a home remodel knows, the roles are reversed at a small scale, and  small builders can find themselves at the mercy of subcontractors and their whims and schedules. Construction costs can’t help but be high for small middle-cost housing projects. Just as we need to lure back small builders, we will need to recreate networks of small subcontractors who can afford to work on small projects.

Finding sites

Unless some brave county council decides to move the urban growth line, there will be very little vacant land on which to build this new middle housing. Redevelopment will make a lot more sense in lower-cost areas if an old home can be replaced by two or more new homes, so we can expect a lot more teardowns (and squawking) in middle income areas.

The larger challenge comes in finding homeowners who want to put a second home, plus maybe an ADU, in their backyards. And once those homeowners are identified, who will do the developing? Who will finance the project? How will the risks and rewards of the development be shared? Some new business models will need to emerge for middle housing to truly meet its potential.

Family and kid friendly?

The biggest housing problem we have in the Puget Sound region is the shortage of affordable child-friendly homes. If all we gain from middle housing is nicer places for people who would otherwise live in apartments, we will have missed an opportunity. Middle housing has the potential to provide homes for moderate income families, but that will not happen automatically.

Market experience over the past few decades indicates that the important thing for families is ground relatedness, safety, light, and privacy. Large backyards are less important, and many families would be fine with one or two common walls. Millions of Americans have grown up in the 1,200-square-foot ranch houses that proliferated in the 1950. So, the compact cottages and duplexes envisioned as part of the middle housing menu can fill the need for child-friendly living if builders approach the floor plans and specs with kids in mind.

Local governments

Middle housing will get built at scale if new builders enter the market or if existing builders find this business more profitable than building conventional homes. In either case, local governments will have an effect on the industry dynamic. They can make it easier or harder.

It is unlikely that many current city residents are thrilled about the added density that HB 1110 calls for, and the bill tries to close the loopholes that cities might use to discourage it. We can only hope that cities approach the implementation of the bill with goodwill and will not try to sneak in any hurdles or disincentives for middle housing.

But the kinds of issues raised above suggest that cities might be more than just neutral about what gets built on a site, and actually encourage middle housing models, especially those aimed at families with children. The very existence of HB 1110 is evidence that the politics of housing has shifted remarkably in the past decade. But it is not clear that that shift goes so far as to lead local governments to proactively promote homebuilding. Advocates have their work cut out for them.

Creating a middle housing industry

Just as the middle housing legislation looks toward a type of housing that sits between our current binary of conventional single-family and large multifamily, so implementation strategies need to facilitate the creation of a middle housing industry that operates between large volume builders and boutique builders. 

This industry segment needs to be comfortable working with small landowners and scattered sites. It needs to find affordable designs that can be replicated easily in a variety of settings. It needs to figure out how to tap the huge unmet demand for moderately priced family-friendly homes.

Homebuilding and the financing industry that supports it are, by nature, cautious, risk-averse enterprises. New markets, new building types and new business models will be viewed with some deserved skepticism, and lots of builders will wait for someone else to go first. As a builder once said, “the earliest Christians get the hungriest lions.” Getting to scale with middle housing will require overcoming that skepticism and diving into new opportunities, and making this segment attractive to the average builder. 

For local governments wanting to see more middle housing on the ground, it will not be enough simply to stay out of the way. They need to make middle housing a better business for local builders than the stuff they have been building for decades. That involves political risk, lots of it.

Michael Luis
Michael Luis
Michael Luis is a public policy consultant who has been wrestling with housing, growth and economic development issues around Washington State for over 30 years. He is author of several books on local history and served as mayor of Medina.


  1. I own 450 acres in north snohomish county. I want to build 3br 2ba rental housing on part of my land. to do this i have had to: hire a survey company to develop a site plan, a wetland biologist for delineation and mitigation if there are wetlands, a civil engineer for impervious surface and infiltration well, a licensed septic designer and then a licensed septic installer, a geotech company, and while i’m doing all of this time is ticking by. Oh yea, I have to get a permit, too. I finally settled on mobile homes so that i could skip the framing, plumbing, electrical and structural inspections, and by doing that cut off 6 months of permit waits. if you fail on any of these things you get punished by being pushed back 3 to 4 weeks. this is for a premade building that is plopped down on a concrete slab. and although the area zoning is for duplex i can’t put two of them down for a duplex; that’s not allowed. i can however build a stick-built building as one and have the mobile as the ADU, but i can’t have two mobiles, either.
    I’m going to estimate that my costs, all-in, to put a mobile home down on land that I already own is $120k.
    add the cost of the mobile itself at 150k, and then real estate commissions and transaction costs and a 15% profit margin and you’re looking at a retail price of $600k. for the cheapest housing i can figure out how to build right now.

  2. If you wanted my input on how to make more affordable housing:
    1) do not discriminate against mobile homes as a unit. Allow two of them to forum a duplex if attached, or two of them to be on the same lot as primary/ADU. they are the fastest sort of housing that there is.
    2) direct the county planning department to have sets of building plans that are pre-approved. “house 1″, ‘house 2” “house 3” – everything in each of those plants is already inspected and approved. don’t have county staff reviewing every new house for months. same comment applies for things like pole barns, garden sheds. have a library of approved plans that people can choose from. heck, solicit designs as a way to beautify the county.
    3) the current glacial pace of submit-reject-resubmit needs to be solved, particularly for simple issues. i saw a building who submitted a health department design for a duplex, and it got rejected (+4 weeks) because the design had two septic fields by mistake. this could have been a simple email or phone call. as it was it costs the builder thousands of dollars to draw a big X on a piece of paper and resubmit it.
    4) geotech and wetlands needs to be able to rely on projects that are close by and have the same conditions. you’re on the same soil type or adjoin the same wetland? then you get the same approval.
    5) our current issues related to impervious surfaces have no meaning in rural areas. drop infitration ponds and other related stuff for lots that are bigger than N acres, which could be 1, 2, 5 or 10 acres for instance. you want more housing? stop with the cruft.

  3. Simple. Eminent domain at market rate. Buy folks out of their SFH’s en masse, which would allow the city to establish a general requirements plan, zoning, and rules. Then make the money back by auctioning the parcel to developers willing to meet the plan. This would allow for actual planning on infrastructure (improving the electric grid, sewers, transit, etc…) to support the density requirements. In effect, the parcel becomes tabula rasa like the original developments.

    By buying people out, you reduce the pushback the de-facto economic taking on the middle class the present “upzone everywhere” attitude causes.

    But it will never happen, because part of the dirty little secret of a lot of Yimby folks is they want that economic taking top be a part of it. It’s not a bug, it’s a feature!


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