Adding Up the Cost of Development of New Housing

Posted October 17, 2022 in Special Features

Developers throughout the country know that the term “buildable” is subjective when determining whether to buy a parcel or lot. So much unseen work goes into land development before the first foundation is even poured. A whole host of regulations and constraints determine the type and quantity of housing built in a particular area. Zoning, wetlands, habitat, open space requirements, slope, soil type, easements, setbacks, and so much more all constrain what developers can do with a given piece of property. As the fastest growing county in Washington State, our communities need to take a fresh look at these constraints and investigate ways to foster flexibility within them so we can accommodate the growth we are seeing by providing not only affordable rental opportunities, but ownership opportunities as well.

Many cities in Clark County have open space requirements dictating that 25% of net developable acres must be dedicated to open space. In some cases, open space requirements are independent decision by cities intended to create more open space within developments – a laudable goal, but one that significantly increases the cost of housing and aggressive open space requirements often limit the amount of naturally affordable housing that can be built on a lot.

Zoning, determined by each jurisdiction’s comprehensive plan outlines what type of housing can exist where. Zoning is absolutely essential to the proper and orderly planning of any community. However, many zoning codes in Clark County are outdated and don’t reflect the needs of the community and the diversity of housing that must be built to meet today’s needs. You wouldn’t use a 30-year old computer to edit and stream videos – why are we using zoning regulations that, in some cases, are decades old? To further enhance affordability efforts, local zoning requirements must be updated to allow for infill and middle housing projects that use existing infrastructure, like sewer and water. This approach also cuts down on maintenance costs for jurisdictions.

Through the complex myriad of national, state, and local regulation developers are left with fewer net developable acres than what many may perceive. Development is not only governed by what you can build, but where you can build it. Environmental and geotechnical factors determine where building envelope(s) can be located. Some properties may contain unsuitable grades, critical areas, and access that may prevent building in a given area for good reason. Builders and developers must balance all of these factors when they plan, site, and construct buildings on any property – all of which factor into the cost of housing.

In Washington State, developers are largely regulated by the Growth Management Act and each Urban Growth Boundary in which they operate. This law further restricts where growth can take place within each jurisdiction, increasing the competition for and price of developable land within the area of the Urban Growth Boundary

Taken together, those that build housing are often overburdened by regulation that restricts where housing can be built, how housing can be built, and what type of housing can be built. Over-regulation, outdated zoning codes and the scarcity of developable land under current regulations significantly increases the cost of housing in a state already struggling with the fewest number of housing units per household. Now is the time for policy makers to partner with private developers and builders to craft solutions that balance the needs of housing residents of Clark County and protecting our natural environment and community character and work for all Washingtonians.

Justin Wood,
Government Affairs Director

Clark County Association of REALTORS®