On February 23, the Seattle City Council unanimously approved an ordinance to set a cap on rental rates for Small Efficiency Dwelling Units (SEDUs), also known as apodments or micro housing, in an effort to further ensure that affordable units are being included in residential developments. Under provisions of the new bill, in order to receive the 12-year property tax exemptions that come as part of the City of Seattle’s Multifamily Property Tax Exemption Program (MFTE), developers would be required to reserve 25 percent (up from 20 percent under current regulations) of their units for those making no more than 40 percent of the area’s median income. That would set rates at $618 per month for single-person households making $24,720 per year, which is about $400 per month less than current regulations for “affordable” units.
Roger Valdez of Smart Growth Seattle told The Seattle Times that the program’s incentives won’t make up for money developers will lose on the lowered rents, and he predicts many developers will not participate in the program, resulting in zero units of affordable housing. Similarly, according to the Urbanist, Councilmember Kshama Sawant during the legislative session questioned how much affordable housing is actually being created, and whether the program is simply a loophole for developers to avoid property taxes. The bill will act as a sort of “trial run”, as the entire MFTE program could be facing widespread reorganization in the coming year.
If you are interested in renting in the Seattle area, contact your local real estate agent today!