WCRER publishes 2024 “State of the State’s Housing” report

Nearly half of all renter households across Washington state pay more than 30% or income on housing costs. Some of these cost-burdened renters pay more than 50%, according to The State of the State’s Housing Report published by the Washington Center for Real Estate Research (WCRER).

The 57-page report has data on apartment rents and house prices, homeownership, housing affordability, and homelessness. Also included is a review of the Buildable Lands Reports prepared by the seven fastest-growing counties (per 1997 legislative requirements). The reports, which are intended to help guide the comprehensive plans in these areas, compare achieved residential densities with targets and “propose reasonable measures for addressing discrepancies.”

In the section on homeownership, the report notes:

• The price of the median house in Washington leveled off between 2022 and 2024, following a decade of steady increases.
• Interest rates rising to levels dating to the early 2000s are the likely reason why house prices are flattening.
• Homeowners are disincentivized from moving and forgoing their average interest of 3.9%—far below the current 30-year fixed-rate mortgage rate of around 6.7%
• High construction costs are slowing down single-family permitting activity.
• The large, persistent gap in homeownership by race continues.

Another section of the report focuses on housing needs and planning. Using median population projections by the Washington State Office of Financial Management, researchers provided needs by counties for all income categories, noting their needs vary dramatically.

More than 1.1 million housing units and over 90,000 emergency housing units are the projected need through 2044.

These needs must be addressed in the next round of the jurisdictions’ growth management plans (due starting 12/31/2024). The plans must also address new requirements for planning for middle housing and Accessory Dwelling Units (ADUs).

For the Building Lands Reports, all seven counties that are required to prepare them (Clark, King, Kitsap, Perce, Snohomish, Thurston, and Whatcom) indicated that have sufficient buildable land to accommodate expected growth though the target years. Only King County said housing is not being built at or above planned densities.

Key provisions of housing legislation enacted between 2023 and 2024 are summarized and discussed, with HB 1110 (known as the middle housing bill) described as “the most changemaking of them all.”

In acknowledging the Washington legislature “advanced an impressive housing agenda” during the 2023 and 2024 sessions, the report also stated, “It will take some time for these laws to have an impact.”

Other notable facts contained in the report include:

1. In 2022, 63% of Washington households consisted of one to two people, with the statewide average size being 2.53 people.
2. From April 2020 to April 2024, the Evergreen State increased its housing stock by 5.7%, with growth distributed widely across the state.
3. The median-priced house in Washington costs approximately $695,000 in Q2 2024. In the Puget Sound region, it was $823,000.
4. Rising mortgage rates are decreasing homeowner mobility and are a key factor in the significant drop in the number of transactions.
5. WCRER’s median-income buyer Housing Affordability Index (HAI) is declining. Significant HAI decreases were found in Bellingham, Seattle, Spokane, Tacoma, Vancouver and Yakima.
6. Washington permitted almost 112,000 new units of single-family housing from January 2019 to March 2024.

The Appendix includes detailed tables with a summary of the Buildable Lands Reports (by jurisdiction) and subsidized housing inventory by county and statewide.

The WCRER report was funded from document recording fees. Additional detailed information on housing in Washington communities with populations over 10,000 plus some selected small jurisdictions may be found on the WCRER website.

The Washington Center for Real Estate Research (WCRER) was established by the State Legislature under RCW 18.85.741 and is primarily fund by the state. As a key provider of real estate research and data across the state, its core activities are the Quarterly Washington State Housing Market Report and the semi-annual Apartment Market Survey for the State Department of Licensing.

The purpose of a real estate research center in Washington State is to provide credible research, value-added information, education services and project-oriented research to real estate licensees, real estate consumers, real estate service providers, institutional customers, public agencies, and communities in the state and the Pacific Northwest region.

WCRER was initially housed at Washington State University with the mission to provide a bridge between academic study and research on real estate topics and the professional real estate industry. It served that mission at WSU until moving to the University of Washington in 2012.