Can We Solve the “Condo Conundrum” in Seattle?

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Blaine Weber, of Weber Thompson Architects, Says the Washington State Condonimiiun Act is Limiting Homeownership Opportunities.

In a recent article published by Daily Journal of Commerce, Blaine Weber, Senior Principal of Weber Thompson Architects, says “the affordable housing crisis is one of the more perplexing problems facing rapidly growing cities like Seattle.” The seemingly obvious solution would be to add more supply to the tight condo market, in which homeownership opportunities are overwhelmingly “beyond the means of the average-income individual” (UW Runstad Center for Real Estate Studies, 2016). So, the question must be asked: why is there a lack of supply when there is so much demand for in-city homeownership?

Though the reasons are many, Weber says a main one can be attributed to the liability that is tied to building multi-family units in our state, as outlined within the Washington State Condominium Development Act.

Lawsuits

Weber tells DJC that at about the four-year mark, a condominium tower is doomed to a lawsuit. “There are many reasons for this fourth-year phenomena,” he says. “The first is the way the state Condominium Act is structured; the second most salient being the aggressive behavior of some plaintiff attorneys who approach HOA board members at this four-year mark to convince them to initiate a construction claims lawsuit.”

Fear & Greed

Having served as an officer on three different HOA boards over the past ten years, Weber says he has seen the way fear and greed emerge hand-in-hand, particularly when an aggressive plaintiff attorney gets involved. These attorneys sometimes fail to tell HOA members that lawsuits might decrease their home’s value or make it difficult to sell, because they’re focused on the payout they may receive should they win.

The Future

Given the supply and demand imbalance, it is clear that changes are needed so that developers will feel more comfortable building multi-family homeownership offerings within the city. Weber says a simple solution would be to shift insurance: “a warranty insurance program similar to that found in British Columbia would allow the ‘weeding out’ of non-meritorious claims – outside of the courtroom,” saving time and money for all parties involved.

“Changes to the Washington State Condominium Act are sorely needed to incentivize developers to build more affordable condominiums,” Weber adds. “As long as the economic opportunity for developing condos fails to offset the risk of ‘automatic’ litigation and non-meritorious claims, we will continue to see a diminution of this much needed housing stock.”

Read the full article in Daily Journal of Commerce here>>