‘It’s a top-of-mind issue’: Officials look for options to address state’s housing shortage

BELLEVUE – With an estimated need for more than 1 million new housing units over the next two decades, business and policy leaders agreed on Monday that more must be done to spur development in Washington.

“Everybody’s here because they acknowledge that a housing shortage exists,” Lt. Gov. Denny Heck said during a panel focusing on affordable housing at the Pacific Northwest Economic Region conference in Bellevue.

To illustrate the point, Heck asked a group of officials to rank the issue’s importance on a scale of 1-10, with the responses ranging from eight to 10. Among those to rank the issue as a 10 was Nicholas Carr, a senior policy adviser focused on housing for the office of Gov. Bob Ferguson.

“Housing is the baseline for thriving and for being successful as a person or a family,” Carr said. “When you lack stable, predictable housing, everything else is affected, from your education to your employment and so on and so forth.”

Carr, who is responsible for creating a long-term housing strategy for the state, added that housing affects so many other sectors in both the economy and the country’s social fabric that it’s among the chief issues that the state must address.

“It is completely necessary to ensure that it is affordable and stable,” Carr said.

During the discussion, the panelists proposed ways the state could work to quickly build more housing to fit the region’s projected growth and ease the strain on those who struggle to afford their current housing.

According to the Washington Department of Commerce, Washington will need to build 1.1 million units over the next 20 years, with at least half of the units designated as affordable housing. According to Heck, half of Washington’s renters, and a quarter of its homeowners, spend more than a third of their income on housing, a group that the U.S. Department of Housing and Urban Development classifies as “rent-burdened.”

As he signed a slate of housing-related policies into law in May, Ferguson said the top issue he heard while campaigning was the lack of affordable housing in the state.

“It just came up over and over and over again,” he said on May 7. “It doesn’t matter if someone lives in north Seattle or Spokane, in a red jurisdiction or a blue jurisdiction, it doesn’t matter. I just heard that concern over and over and over again.”

As he signed a bill capping yearly rent-increases into law, the governor said he has frequently heard from renters forced to move further and further away from their jobs in large metropolitan cities as their rents have increased.

Ferguson has set a goal of adding 200,000 units of housing during his first term in office. During his first legislative session, Ferguson took several steps to meet the goal.

In one of his first official acts in office, Ferguson directed state agencies to review regulations related to housing, permitting, and construction to identify areas that could be streamlined to increase supply.

During the 2025 legislative session, dubbed “The Year of Housing 2.0,” lawmakers passed an array of bills aimed at reducing barriers and streamlining development, including a cap on the number of parking spaces a jurisdiction can require for projects and cutting timelines for housing permits.

Lawmakers also included $605 million in the state’s capital budget, a record, for the construction of affordable housing projects through the Housing Trust Fund.

Heck, who headed Ferguson’s efforts to boost housing during his transition, gathered reporters in the Capitol on the last day of the session to discuss the progress legislators had made.

“They took big steps forward,” Heck said following the session.

On Monday, Heck again pointed to the work of the Legislature this year as a reason for optimism.

“Did we do everything we needed to? No, but it’s a top-tier issue, it’s a top-of-mind issue,” Heck said.

The state will likely need to shift to a different model of housing in order to fit its goals.

Among the solutions, according to Carr, is to increase the amount of modular and manufactured housing units built off-site to meet the state’s needs.

“We can do all of the subsidies in the world, we can just get all of the regulation out of the way. And if we are still, in 20 years, building stick frames on-site, we will never, I repeat never, hit the goals of the homes we need,” Carr said. “The number will not exist that we need, without doing off-site.”

Carr said the units could be built in facilities throughout the state, which he said would come with environmental and employment benefits. Asked by Heck about what is impeding the development of the homes, Carr pointed to state and local regulations and inspection speeds.

“There’s some work to do on what looks like a new, off-site scheme,” Carr said. “This is not new; this is kind of the rediscovery of something that’s already been done. But this is how we get to the scale that we need to get to.”

Heck, who said he has visited a plant that produces off-site homes, told the panel that units are indistinguishable from homes built on site, and can be built more quickly and affordably.

“This is not our parents’ manufactured homes,” Heck said. “You cannot tell the difference between a plant-built home and an on-site-built home today.”