Congressman Denny Heck (D-Olympia) introduced a series of discussions in Tacoma on Wednesday focusing on what he described as one of three basic human needs – shelter - but not necessarily football, although football did become part of the morning’s agenda.
Before a standing-room-only crowd of more than 300 business leaders, elected officials and affordable-housing advocates at Hotel Murano, Heck started the program by emphasizing the importance of a 30-year-fixed mortgage and calling on his colleagues in the Other Washington to create a balanced regulatory framework aimed at financial reform.
Then came the numbers.
In a brief presentation, Krishna Rao of Zillow noted that “the housing market has been a bit of a roller coaster,” with recessionary pressures taking home prices down 32 percent from their peak.
But things are improving in the region, he said, with prices currently down only 18 percent from the pre-recession peak. Meanwhile, home prices continue to appreciate throughout the region.
Part of what drives this appreciation, he said, was “tightness,” with a low inventory of available homes.
Still, homeowners endure the consequences of the recession. Today, 33 percent of Tacoma mortgage loans are underwater – with a value less than the owner’s equity. In Seattle, the figure dips to 12.6 percent, and in Bellevue, 7.6 parent.
The consensus among experts, Rao said, has mortgage rate staying under 5 percent through 2014.
Beginning a 75-minute panel discussion, moderator Dan Fulton, former Weyerhaeuser CEO, tapped into football by asking what metaphorical quarter we’re in now that recovery has been established.
“We’re at halftime,” said developer Bill Riley, owner of BRC Family. Connie Brown, executive director of the Tacoma-Pierce County Affordable Housing Consortium, agreed, adding, “We need a talking-to by the coach.”
Kim Herman, executive director of the Washington Housing Finance Commission, placed the game more optimistically “at the beginning of the third quarter. I think we’ve bottomed out.” Rich Bennion, residential lending director at Homestreet Bank, put us “later on in the third quarter. We’re moving more quickly and more strongly than much of the rest of the country.”
Meanwhile, panelist Ada Healey, vice president for real estate with Paul Allen’s Vulcan, Inc. said she foresees an oversupply of housing within the next five years. Healy is responsible for much of Vulcan’s growth at Amazon’s multi-use Seattle campus.
Divining housing and demographic data, Bennion said he foresees young people moving toward high-density housing instead of seeking rural or suburban homes.
“Developers are building smaller units,” said Healey. Smaller units with less parking.
Herman noted an inadequate supply of housing for seniors.
Asked to identify factors obstructing an increase in affordable housing, Bennion cited a lack of jobs and the high cost of land. He received a round of applause by calling for a response to income inequality.
In introducing the forum’s keynote speaker, Shaun Donovan, Heck said the HUD secretary would typically be 13th in the line of presidential succession. However, with Secretary of the Interior Sally Jewell having been born in England, and therefore being ineligible to take the office, Donovan is, indeed, “twelfth in line. He is the 12th Man.”
Applause followed as Heck presented Donovan a Seahawks jersey.
“As bad as our financial difficulties are, I worry more about our ‘trust deficit,’” Donovan said, noting the dysfunction that clouds the federal body politic.
“It is time for us to make housing finance reform a reality,” he said.
He promised that the housing market is “healing” as home values increase nationwide.
“Progress is happening,” he said. “It is real.”
And it will continue getting better. Just remember that contest last weekend against San Francisco.
“Where were the Seahawks early in that game?” Donovan asked.
“Together let’s shape a better and stronger America for all of us.”