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Seattle has put in a series of policies that have spurred the construction of thousands of new rental units – at affordable rates, writes Frances Bula

Seattle rents have shot upwards in the last few years, as the economy has boomed and new people have flooded to the city to work at Amazon, Microsoft and a plethora of other tech companies.

In the once-popular and student-dominated area of lower Capitol Hill, rents had jumped to about $1,500 (U.S.) for a one-bedroom apartment by last September.


The rapidly rising cost of rental units in Canada’s largest cities, along with vacancy rates near zero, mean it’s increasingly difficult for people who rely on rental units to find – and keep – their housing. Like the real estate market, rental prices have become detached from incomes and are forcing people to live in cramped apartments, find roommates well into adulthood or simply move away.

The Globe and Mail is spending the summer examining how those factors have shaped the lives of renters, landlords and their cities.

That's what Bonnie Swift was facing when she looked at the options for herself and her young daughter, as she hunted for something besides the $1,100-a-month studio she'd rented quickly after she and her partner had split up six months earlier.

Today, she's in a comfortable 700-square-foot, one-bedroom apartment at 12th and Pine, just blocks from the new light-rail station, places such as Seattle's go-to Elliott Bay Book Company and shops along Broadway.

And she's paying $900 a month.

"We're right in the middle of a great neighbourhood. It's clean and safe," said Ms. Swift, a 32-year-old writer, editor and radio producer who typically earns between $30,000 and $40,000 a year.

That income is about 60 per cent of the median income in Seattle, and it allowed her to qualify for an unusual type of rental deal that Vancouver – roughly 225 kilometres away – doesn't have.

RELATED: Families particularly vulnerable to Vancouver's tight rental market

Like Vancouver, Seattle has been frantically looking for ways to spur development of rental apartments as an affordable housing alternative for residents. Like Vancouver, about 52 per cent of its residents are in renter households. And like Vancouver, it has offered developers bonus space, allowing them to go higher and bigger. It has reduced development fees and parking-space reductions as an enticement to get them to build fewer condominiums and more purpose-built rentals.

But as an example of the many ways that North American cities under pressure are looking for solutions, Seattle adds one more carrot.

Stuart Isett/For The Globe and Mail

The city gives developers a holiday from property taxes for the building (but not the land) for up to 12 years. In return, the owners have to agree that 20 to 25 per cent of the units in their developments will be rented to tenants who earn below the usual median income, and those tenants will be charged rents equal to 30 per cent of their income.

By December, 2015, the city had almost 4,000 of those apartments in the city, with another 2,000 approved and in the pipeline. They're built by both private developers and non-profits, such as Capitol Hill Housing, which owns Ms. Swift's apartment and 900 others in 48 Seattle buildings.

"It's been a good way to get some affordability and it has been successful in getting some market-rate developers to dip their toe into this," said Capitol Hill's director of community programs, Michael Seiwerath.

RELATED: Low-income renters in Vancouver face difficult calculations

The multifamily tax-exemption program provides an option for people who don't qualify for subsidized housing because their incomes are too high, but struggle to pay the ever-rising costs of rentals in the free market. And it gets them into apartments at prices far below what Vancouver has set as the maximum rents for buildings that have received incentives under its Rental 100 program.

In Vancouver, a developer can charge up to $1,260 for a studio on the east side and $1,386 on the west side; and $1,675 for a one-bedroom on the east side and $1,843 on the west side. There is no requirement to scale the rent to the tenant's income.

Seattle's idea is a good one, said Vancouver's general manager of community services, who is overseeing what is planned to be a dramatic overhaul of the city's affordable-housing plan.

"We're in a real moment here. I believe we could do something transformational," Kathleen Llewellyn-Thomas said. "We like the Seattle ideas. I'm keeping an open mind."

The 12th Avenue Arts building in Seattle, run by the non-profit group Capitol Hill Housing.

The 12th Avenue Arts building in Seattle, run by the non-profit group Capitol Hill Housing.

Stuart Isett/For The Globe and Mail

Ms. Llewellyn-Thomas said Vancouver and Seattle have leapfrogged each other for decades when it comes to housing policy. At the moment, Seattle has jumped a little ahead. It's had the property-tax program for almost 20 years. (Vancouver staff considered a similar idea in 2009, when the Vision Vancouver council developed its first major housing policy, but then backed away from it.)

In August, Seattle significantly boosted its ability to put money into housing when residents voted 69 per cent in favour of a new housing tax that will provide $290-million in the next seven years – double the amount of the previous levy passed in 2009.

That took place in the wake of a year-long process kicked off by Mayor Ed Murray in September, 2014, to come up with new ways of thinking about housing policy in Seattle. Last fall, a group of community representatives made 65 recommendations to help the city meet a goal of creating 50,000 new units of housing within the next 10 years – 20,000 of them affordable to lower-income residents.

City council is now in the process of going through those recommendations one at a time, turning them into reality through official motions and bylaws.

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"The mayor has set out a very aggressive agenda," said Jason Kelly, the head of a new office of planning and community development. "With what the mayor and city government have done, Seattle is in the forefront."

Council decided early on that it wasn't going to entertain the idea of rezoning single-family neighbourhoods – which take up 65 per cent of the land in Seattle – to make more room for denser developments, in spite of an early recommendation. Many housing experts say such a move is essential to truly bring down the cost of housing and make room for more people. But it's viewed as political suicide by city councillors in most cities.

However, the Housing Affordability and Livability Agenda did come up with other ideas that Seattle's council is prepared to move on, such as increasing density in urban villages around transit and requiring all developers to include a certain percentage of affordable housing in their projects in exchange for density. The group also recommended expanding the areas where the multifamily tax-exemption program can be used, Mr. Kelly said.

Ms. Llewellyn-Thomas said she hopes that Vancouver will be similarly bold and creative, although she stressed that the city is ahead of the game on many fronts – such as providing tens of millions of dollars worth of land for affordable-housing sites and pushing for a vacant-house tax.

"We're going to be really engaging with the community to see what is important to them," she said, adding that nothing is off the table at the moment, so Vancouver's housing "reset" process won't be eliminating the idea of considering more density in single-family zones.