For the next installment in our ongoing series about chronic homelessness, we’re digging into the numbers to tackle a question we’ve heard from several readers:
“What would it cost to build as many housing units as we require to house the people who are homeless in Seattle? Is there any other way to solve the problem?”
It’s a simple question, but the answers are complicated. That’s because different people need different types of assistance: For example, there’s a big difference in the costs associated with building a unit for someone who can pay rent on their own, versus providing a chronically homeless person with permanent, supportive housing.
It’s also tough to draw a box around the cost of construction without considering things like land acquisition, ongoing maintenance, taxes, and the cost of providing wraparound services to folks with underlying medical or mental health issues.
But here is what we do know:
Roughly 11,000 people are estimated to be living homeless in King County right now, and experts believe 20 to 30 percent (around 3,000 of them) would be considered chronically homeless under federal guidelines.
A 2018 report from an independent consulting firm concluded our region would have to build 14,000 affordable housing units and double our annual spending to $410 million in order to solve the problem. That’s a huge chunk of money, and it’s part of the reason why our congressional representatives are pushing for more federal tax credits to help offset the cost of increasing our housing supply.
Meanwhile, others are zeroing in on permanent, supportive housing as the most cost-effective, long-term solution to chronic homelessness. It’s a specific type of affordable housing where residents have 24/7 access to onsite services, including health care, substance abuse treatment, and case management. Rent is usually subsidized to align with a resident’s income, which can be very little if they are unable to work.
All of that is to say: It’s not cheap. But advocates for this approach say the $16,000 to $22,000 annual cost pales in comparison to the alternatives.
“If you’re a fiscal conservative, and you care about money and not wasting money, we’re wasting an exorbitant amount of money right now not solving the problem,” says Chad Mackay, co-director of the Third Door Coalition, a Seattle-based group of researchers, business leaders, and service providers.
Third Door estimates it costs the same amount of money — $20,000 or so — for taxpayers to pay for three days in the E.R., one month of incarceration, or one year of supportive housing. The figure is based on data from local service providers, and it doesn’t include capital costs.
So how much does it cost to actually build the units? It depends. But there are some real-world examples that give us a ballpark estimate.
Plymouth Housing, the sponsor of this Evergrey series and also the city’s largest provider of permanent supportive housing, is about to break ground on a 91-unit supportive housing facility on city-owned land in Lower Queen Anne. Total construction costs are estimated to be between $25 million and $30 million, which works out to about $275,000 per unit.
Third Door Coalition is one of the groups trying to figure out why affordable housing is so expensive to build and what can be done to bring down capital costs for supportive housing. Mackay said he isn’t sure the exact number of supportive units needed in King County, but knows “it’s in the thousands.”
“We’ve gotten far behind as the chronic homeless population has grown,” he says.