Here's what happened when other cities allowed 'backyard houses'

Bellingham debates whether to allow more ADUs in single-family neighborhoods

Bellingham may expand the number and size of accessory dwelling units -- so-called mother-in-law apartments added to a house or garage -- allowed in single-family neighborhoods citywide.
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Bellingham may expand the number and size of accessory dwelling units -- so-called mother-in-law apartments added to a house or garage -- allowed in single-family neighborhoods citywide.

As Bellingham's elected officials consider a controversial plan that could allow more backyard cottages and other accessory dwellings in single-family residential zones citywide, other U.S. cities have OK'd them — with varied results.

A decision on the matter could come as early as Monday night, when the Bellingham City Council is being asked to vote.

In Bellingham, the push to change the rules regarding accessory dwelling units, or ADUs — especially detached units that are separate from the main house — comes as city officials have been looking for ways to add housing without causing sprawl amid rising rents and home prices.

Officials see the new rules as just one part of an overall plan to add affordable housing in a real estate market that has a vacancy rate that's nearly zero.

But small backyard homes and remodeled garages are a complicated and contentious topic, especially in those neighborhoods near Western Washington University with a high number of rental homes that have become virtual rooming houses, and detached units that neighbors say have been illegally converted.

"It's a trend that's got 50 percent in favor and 50 percent against it," said Tom Follis, a real estate appraiser and broker in Bellingham.

Rising home prices, rents

Rising rent and home prices are national issues, said Angela San Filippo, a long-range planner with the city of Ellensburg.

San Filippo said Ellensburg is looking at revisions to its accessory dwelling unit ordinance, which last had an overhaul in 2013 — mostly to create more infill housing in single-family residential areas.

"We also want to be providing more affordable housing," San Filippo said.

Ellensburg, a city of 19,786 on the east side of the North Cascades and about 110 miles from Seattle, is home to Central Washington University.

According to Zillow, the real estate database company, the current median home value in Ellensburg is $236,095, up from $176,646 in 2013. Average monthly rent is $1,542, up from $1,325 in 2013.

"We're seeing similar issues, but we're seeing that across the nation," San Filippo said.

Bellingham had 86,720 residents in 2017, and housing costs began to rise sharply about five years ago.

In March 2018, the median home value here was $388,588 for a single-family house and an average monthly rent was $1,686, according to Zillow. In 2010, a single-family house was $268,021 and monthly rent was $1,356.

A 2008 federal Housing and Urban Development study examined several cities nationwide that were struggling to provide affordable housing, without adding sprawl, in the face of rising rents and home prices — just like Bellingham is now.

Cities that HUD studied in its report have been able to add housing without expanding their borders, but in many cases home prices and rents have continued to rise. That's a criticism levied by those who oppose Bellingham's plan to make accessory dwellings, especially detached accessory dwelling units, known as DADUs, easier to build in residential areas citywide.

"As to the idea that DADUs will allow us to build our way into affordability, the statistics do not support that assumption," said Kim Bogren Owen, former president of the York Neighborhood Association, whose board opposes the plan that Bellingham is considering.

Bellingham officials have countered that the housing crisis requires a citywide response.

HUD's report said that cities nationwide began to limit or exclude so-called "granny flats" in the 1950s and 1960s as communities steered away from higher-density development. But now, many American cities are encouraging denser growth with "infill" projects within existing neighborhoods, including DADUs.

What's happening elsewhere

A few of the cities that HUD studied share common characteristics with Bellingham — including Fauquier County in northern Virginia west of Washington, D.C., and Santa Cruz on the California coast south of San Francisco.

Both faced similar concerns from residents as DADU rules were being discussed — including parking problems, increased traffic and noise, and fears about DADUs becoming short-term rentals or Airbnbs.

Fauquier County, a mostly rural area with 65,203 residents in the 2010 census, was one of the richest and fastest-growing areas of the U.S. In the 2000s. Its officials sought to provide additional housing in the county's nine small cities and still protect farmland and open space.

Median home value in Fauquier County was $271,959 in 2010, rising to $358,493 in March 2018, according to Zillow.com. Average rent was $1,542 in 2010 and $1,710 in March 2018.

Rob Walton, chief of zoning and development services for the county, said their intent was to give homeowners more options to develop their property, and not necessarily to provide affordable housing.

Protecting farmland was the main goal of their ordinance, and only 10 to 15 DADUs at most were being built each year countywide, Walton said.

ADU Santa Cruz.jpg
David Foster shows the accessory dwelling unit behind his home April 2015 in Santa Cruz, California, where 200 to 300 such units have been built in the past 15 years. Recent statewide California regulations have eased regulations regarding their construction. Dan Coyro, Bay Area News Group McClatchy file

It's a different story in Santa Cruz, where 200 to 300 such units have been built in the past 15 years. Recent statewide California regulations have eased regulations regarding their construction, trumping local ordinances, Khoury said.

Santa Cruz is a town closer in nature to Bellingham, a highly popular tourist destination with a University of California campus that's the area's largest employer. Its 2013 population was 62,864.

In 2010, the median home value in Santa Cruz was $577,172 and the average monthly rent was $2,373.

Now, the median home value in Santa Cruz is $913,912 and the average monthly rent is $3,026.

"'Affordability's a relative term in the Bay Area," said Alex Khoury, the city's assistant director of planning and community development.

He said DADUs were first allowed in the late 1980s and only about 20 were built citywide in 20 years. Regulations were eased in 2002 and again in 2014. Forty to 50 such units have been built per year since then.

Rents for a small studio or backyard house run $1,200 to $1,500 a month, Khoury said — a relative bargain in "Surf City."

Recent news stories have touted California's efforts to ease the statewide housing crisis with such detached homes.

"San Francisco landlords are turning ‘crappy old storage rooms’ into apartments — and it’s good news for the city," CNBC reported in December 2017.

"Could granny flats help ease the state's housing crisis? Some advocates think so," the Los Angeles Times reported last month.

Back in Bellingham, opponents of the plan favor an ADU law that would take a neighborhood-by-neighborhood approach.

Conversely, members of the Happy Valley Neighborhood Association board have asked for a pilot project that would allow more DADUs in their area.

It's bound to remain a divisive issue, and it's bound to flare again when the City Council takes up short-term rental regulation next month.

"You really can't say if it's good or bad unless it's going up next to you or down the block," Follis said.

Robert Mittendorf: 360-756-2805, @BhamMitty
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