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Many affordable housing projects in Washington are funded in part by the state’s Housing Trust Fund.
A new report from the Department of Commerce looked at the costs of building more than 1,200 new affordable units with money from the fund last year. This shows that project costs have decreased, but have increased overall statewide.
Many affordable housing developers combine multiple types of financing to get projects built, including the Housing Trust Fund and the federal Low Income Housing Tax Credit. About 81% of projects included in the report had both types of financing.
The new report included projects that provided final development cost data to Commerce between July 1, 2022 and June 30, 2023. Other multifamily housing projects not covered in the report received Housing Trust Fund dollars during this period but had not submitted cost certification documents.
Here are three conclusions from the report.
The average unit cost for multifamily properties receiving Housing Trust Fund assistance in 2023 was $301,744. That’s down from 2022, when the median was $316,097.
From 2019 to 2021, unit costs were well below $300,000, but they were rising. In 2019 this was $207,496, and in 2021 it was $262,331.
These costs include everything a developer has paid for land, infrastructure and any financial reserves.
The most expensive units are in King County, where the average cost per unit was $356,813, and the least expensive units are in rural areas where the average cost is $221,784.
Meanwhile, the average cost per square meter last year was $494 – that’s $102 more than the year before. Projects in King County also had the most expensive costs per square foot, with an average of $551. That’s compared to $452 in other urban areas and $299 in rural areas.
According to the data, the Housing Trust Fund helped build 21 multifamily projects across the state in 2023.
That is a decrease compared to the 32 the year before and a lot lower than in 2019, when there were still 51.
King County had the most projects with five. It also had some of the largest projects, most of which had almost 100 units.
There were more projects in urban areas than in rural areas: nine projects were built in urban counties such as Snohomish and Spokane, compared to seven in rural counties such as Yakima and Whitman.
The number of homes in multi-family projects has decreased compared to previous years. In 2019, the multifamily projects covered in the report had a median of 114 units. Last year the median was 56. In 2022 it was 99.
Rural projects had the fewest units, with only 46 per project. That’s compared to about 65 units in urban areas.
The size of the projects varied considerably. A project in King County in the Bitter Lake neighborhood had the most units at 100, but many projects had fewer than 30 units, including the smallest, in Kennewick, with 16 units.
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