Social housing is coming to Seattle

What on earth is social housing?

This is sort of an emergency Housing Authority post, or maybe a special edition would be more accurate. As much as I want this to fulfill my Newsie dreams and create an “Extra! Extra! Read all about it!” situation, alas. It’s coming to you in the usual, regularly scheduled way.

So instead of following up on my last piece about the municipal and county zoning shakeup in California as I planned, we’re going to talk about social housing since Seattle is on track to pass an initiative bringing the policy to the city.¹

Check out the website for House Our Neighbors, the coalition behind the initiative, and the Yes on I-235 campaign.

What does social housing mean?

At its core, social housing is government-operated apartments that are available to people of multiple incomes. That last part is mostly what differentiates social from public housing, the other part being that public housing is almost exclusively owned by the state while social housing can be (but isn’t always) owned jointly by the state and nonprofits. The definitions can get pretty granular and aren’t really that important or even unanimously agreed upon, so we aren’t going to spend much time on them. In fact, I’ll be using public and social housing interchangeably throughout the piece. That’s how much stock I put in these definitions. I know I’m a maverick who can’t be contained, it’s just part of my charm. Anyways.

Before we get into the specifics of Seattle’s policy, it’s important to point out that social housing already exists and has been successful in other cities, namely Vienna² and Singapore.³ Social housing is the norm in both cities, where a majority of residents (not just renters) live in government-operated units. Despite the general agreement that the two cities’ policies are successful, they are vastly different. I plan to write pieces on public housing in both Vienna and Singapore in the future, so I’ll spare you the details here, but we’ll do a quick compare and contrast before getting into what’s happening in Seattle.

Social housing in Vienna and Singapore: the similarities

So first, what are some similarities? As I said above, the majority of residents in Vienna and Singapore live in public housing, to the tune of about 60% in Vienna and 80% in Singapore. This scale of public housing is all but unheard of in the US, as Vienna’s population is just under 2 million, while Singapore’s is about 5.5 million. The big takeaway for me is that both cities operate successful public housing programs and do so on a massive scale. How is that possible? Centralization!

Vienna and Singapore both have very large, very organized, and very well-funded housing authorities with enormous legal power. In Vienna, a left-wing government was able to purchase land during the famous period of hyperinflation in the 1920s while passing an aggressive tax regime to fund housing construction. As such, the Viennese government owns most of the city’s real estate and is able to provide subsidized rents that private landlords can’t compete with. The municipal government also imposed strict regulations on the private rental market and exerts enormous control over it to maintain the city’s goals of livability and affordability.

Singapore’s approach was and continues to be very different, but the important similarity is that a highly organized housing authority was given a broad mandate to buy and develop land for public housing. An agency called the Housing & Development Board started acquiring land and building public housing after a catastrophic fire⁴ left thousands of Singaporeans homeless. In contrast to Vienna’s goal of providing livability, affordability, and access to the city to all residents, Singapore’s mission was to use housing policy to create wealth and social cohesion. And while their intentions were very different, both cities relied on decisive state intervention to create and maintain robust public housing programs.

The differences

The specific differences between Vienna’s and Singapore’s public housing policies could fill a library. Vienna is a medium-sized city and the capital of a small, albeit relatively wealthy, country. Singapore is a city, state, and nation within itself with a population comparable to all of Austria, not just Vienna. As such, both the legal framework and the practical aspects of both policies are very different. These differences aren’t all that interesting, so I’ll leave it there for now.

But you know what’s more interesting than differences in legal and practical policy? Differences in ideology. Vienna’s public housing came from a socialist government committed to providing inexpensive high-quality housing to every resident of Vienna, particularly the working class who were relegated to tiny, dark, unsanitary rentals. They were able to do so by levying progressive taxes on Vienna’s wealthiest residents to acquire land and fund the construction of public housing and subsidize rents. And to this day, public housing in Vienna is kept affordable via rent subsidies.

In Singapore, however, the government seized land via eminent domain in order to create wealth, eliminate slums, and encourage social cohesion between ethnic groups. After purchasing land and building public housing, the government sells 99-year leases to residents instead of operating as a landlord renting to residents of the city. As such, the homeownership rate in Singapore is among the highest in the world, especially compared to dense urban settings. The Singapore model does not prioritize affordability, at least not to the same extent as Vienna’s, so houses are not especially affordable there. A comparison I’ve seen many times while researching this piece states that Singapore’s housing market is comparable to that of Salt Lake City. So while things aren’t especially affordable there, they’re a lot better than they could be. I would have expected Singapore’s affordability to fall closer to somewhere like New York or London, both of which are far more expensive than Salt Lake City.

Social housing in Seattle

We’ve seen that social housing can be successful in different forms elsewhere, so what exactly is happening in Seattle? The ballot initiative will create the Seattle Social Housing Developer (SSHD), a city agency that will acquire, build, maintain, and operate permanently affordable housing for residents of mixed incomes. The agency will have the authority to issue tax-exempt bonds in order to raise funds, which will likely be used first to purchase existing buildings and later to construct new ones.

The City of Seattle will provide roughly $750,000 in startup money to SSHD to secure office space and all the boring stuff that comes with creating and staffing a new municipal agency. After that, SSHD will compete for money within the city budget for ongoing, a notoriously fraught position for any agency. Its ability to issue bonds is good for SSHD’s long-term viability, however, since funding won’t be totally at City Council’s discretion.

Units owned and operated by SSHD would be available to residents making anywhere from 0-120% of area median income (AMI), and rents would be capped at 30% of a renter’s income. AMI in Seattle is just over $120,000 annually, so the income cap will be about $145,000. The idea is that rent paid by those making close to or above AMI would subsidize those of a building’s lower-income residents, an attempt to build sustainability and self-sufficiency into the model.

An important but overlooked aspect of Seattle’s new policy is that it imposes a process for the sale of public lands. Specifically, it will require the city to perform a feasibility study determining whether the land should be transferred to SSHD and social housing developed before the land is sold. This part interests me because land acquisition is at the core of any public housing strategy–remember Vienna’s land purchase in the 1920s and 30s and Singapore’s extensive use of eminent domain–and this public land process would provide SSHD with some legal apparatus for acquiring land beyond its purchase land and/or buildings outright by issuing bonds.

Stay tuned for part 2!

Now that it appears Seattle will pass their social housing initiative, it remains to be seen how successful SSHD will be. It’s impossible to say one way or the other if the initiative succeeded or even made a significant impact on Seattle’s affordability before the 5-10 year mark, so we’ll have to wait and see. Luckily for you, you’ll only have to wait a couple of weeks before hearing what I have to say about it. In part 2, I’ll compare and contrast Seattle’s social housing program to Vienna and Singapore’s and analyze where Seattle may fall in its newly embarked project to tackle the affordability crisis.

1. Anna Patrick for the Seattle Times, Lead continues to grow for Seattle’s ‘social housing’ measure

2. Aitor Hernández-Morales for Politico, How Vienna took the stigma out of social housing

3. John Bryson for The Conversation, A century of public housing: lessons from Singapore, where housing is a social, not financial, asset

4. Wikipedia, Bukit Ho Swee fire