January Executive Director Note

January 30, 2024

Why is Futurewise supporting rent stabilization?

Housing has been a growing priority for Futurewise. When the Growth Management Act was passed in 1990, Washington State was one of the most affordable places to live in the country. Now it is one of the most expensive. Our framework for growth needs to change in response. That’s why we led campaigns to pass Seattle’s Housing Affordability and Livability Agenda from 2016-19, championed a complete overhaul of housing requirements in comprehensive plans (HB 1220 passed in 2021 – the first comprehensive plans under these new rules will go into effect at the end of this year), and fought for missing middle housing options in cities across the state (HB 1110 passed in 2023 – starts going into effect in July 2025).

The tools that are in our core wheelhouse, the planning and land use systems we work in, are best suited to address housing supply. But academic research tells us that to fully address our housing crisis, we need a more comprehensive strategy that combines supply strategies with subsidies and stabilization policies. We don’t lead on these other policy areas, but we support our partners. That’s why we supported over $1 billion in state funding for affordable housing last year and endorsed the Seattle Housing Levy renewal. It’s also why we endorsed rent stabilization bills in the state legislature last year and why we are doing so again this year.

This year, our engagement in the rent stabilization conversation is a little higher profile. That is in large part because the opponents of rent stabilization are arguing that stabilization policies will stop developers from building new housing. This framing has pushed us to speak up more about how we think these policies can work together. Futurewise is one of the few local nonprofit organizations that has expertise in zoning, permitting, and real estate development but does not represent the vested interests of developers and property owners.

Here are some of the ways we think the policies work together:

  1. Tenants need predictability now, but supply-based strategies will take years to affect prices. We are so proud of the steps our state has taken to increase housing accountability in comprehensive plans and require missing middle housing options across the state. But these policies will only start taking effect in 2025 (later in some places) and it will take years for new housing to be built under this new zoning. If rents spike while we wait for this new housing, current residents will be displaced before they see any benefits from more housing supply.
  2. At a statewide or regional level, supply brings down prices, but at a neighborhood level many tenants are worried about gentrification when fancy new buildings are built near their homes. Rent stabilization policies help mitigate that concern because, even if a new building makes a neighborhood more fashionable for wealthy people, existing tenants are protected from big spikes in their rents. This also helps reduce political opposition to new construction.
  3. In many places around the US, rent stabilization was implemented at the same time as downzones and other policies that made development difficult and expensive. But it doesn’t have to be this way. We can stabilize rents while we also continue to pursue policies that allow more housing and reduce costs for developers and property owners. We are committed to continuing to advocate for both.

Opponents of rent stabilization point to San Francisco as a cautionary tale, a place that has rent stabilization alongside a major housing shortage. I agree that San Francisco is a scary example of a housing market gone horribly wrong (I used to live in the Bay Area and experienced this personally), but based on our understanding at Futurewise, that dysfunction is mainly about restrictive permitting and zoning. The San Francisco Chronicle published a detailed op-ed on permitting in San Francisco last march. Projects have to secure 87 different permits. Just the entitlement phase of the permitting process takes a year and a half, and then you have to start the building permit process. Many steps in this process are discretionary, meaning that the city can change the requirements mid-process and send a developer back to the beginning. This is indeed a cautionary tale, but it’s not about rent stabilization.

We can and must stabilize rents and build a lot more housing. Washington State has the opportunity to lead the way.