I was thrilled to see Housing Solutions Network’s recently published survey on housing needs in Jefferson County. I applaud this project and its focus. HSN is one of several organizations, including Habitat for Humanity and Bayside, doing important work addressing aspects of our local housing crisis. I agree with most of the recommendations made by HSN based on the survey, but must quibble with some proposed solutions related to rental housing that seem to ignore economic realities.

The survey of Jefferson County residents and businesses illustrates the scope of the problem. It found that 55% of our workforce spends more on housing than the recommended maximum of 30% of income. The median home sale price in Jefferson County in 2023 was $643,000. If those in our workforce are not on the upper end of the income range or were not lucky enough to buy a house five years ago or more, they are unlikely to be able to do so now. Over a third of our workforce evidently commutes from out of county, having found less costly housing in Kitsap or Clallam. Which leaves those who both live and work in our community to find one of a dwindling number of rental homes, stay with relatives or friends, or live unsheltered. Amongst residents who rent, 72% spend more than the recommended maximum portion of their income, often far more.

The shortage and cost of housing impacts businesses as well. The survey found that 71% of businesses have had at least one offer to potential employees rejected over the last five years due to the cost or lack of housing. All of this accentuates our graying demographics.

HSN notes that younger residents are far more likely to consider housing other than conventional single-family housing, including townhomes, manufactured housing, park models, ADUs and apartments. I hope that our local and state governments will do all they can to facilitate such housing types.

The HSN report recommends a number of actions with which I agree. These include streamlining our local permitting process and reducing lot sizes in our growth management areas (“UGAs”).

Similarly I would go further and provide for the creation of a greater number of small lots adjacent to UGAs and historic village centers, providing smaller more affordable lots for urban and non-urban residents alike. I also appreciate the suggestion of density bonuses provided to developers to incentivize the creation of affordable units when building more lucrative housing.

On other points related to rental housing I believe HSN missed the mark. The term “landlord” tends to connote well-to-do real estate moguls that are out to exploit renters. We need to keep in mind that most landlords, at least in our county, are simply people trying to make a reasonable return on an investment.

The HSN report suggests rent stabilization as a solution. This notion is in vogue in Washington due to the pain that many renters felt when COVID restrictions ended concurrently with escalating real estate prices. But it ignores the fact that many landlords lost money during the 2020-2021 COVID period due to moratoriums on rent increases and on evicting non-paying tenants. Resulting rent adjustments made at the end of that period were sometimes shocking. This history coupled with proposed annual rent increase caps would, I believe, likely lead to many landlords reflexively imposing the maximum increase each year. They would take an increase they may not need knowing that they may not be able to later get one that they do need. Such restrictions may also simply drive some landlords out of the business, selling rather than renting properties and removing them from the ever shrinking rental pool. I believe rent stabilization may work to worsen the very problem sought to be helped.

The report also suggests naively that landlords should set rental rates as equal to the mortgage they may pay on their rental property plus 10% for incidentals. This calculus ignores the fact that 10% would likely be insufficient to cover a landlord’s costs for real estate taxes, income taxes, insurance, maintenance and repairs. It also ignores the fact that most landlords are motivated in part by the desire to receive a reasonable profit on their real estate investment. I do know some altruistic landlords in the tri-area that intentionally rent properties at well below market rates so as to help people of limited income.

But many landlords are motivated in good part by how to best use their capital to make a living. And they have choices — should they keep that capital in rental housing, or invest it in something that is far less work to manage, such as a bank CD or dividend-bearing mutual funds?

I hope that those who can chart our housing course keep in mind business realities, but in the meantime remain grateful that HSN is attempting to tackle the growing need for housing in our community.

Marcia Kelbon is an attorney and engineer based in Quilcene.