Seattle’s multifamily microhousing maintains exceptionally strong fundamentals in 2019, but further development heavily regulated

Multifamily microhousing may still be a contentious asset class to Seattle City officials, but the property type has been normalized among both investors and renters over the past decade, according to the 2019 Microhousing Market Study, released Kidder Mathews.

The regulatory environment for multifamily microhousing — which includes congregate units, micro studios, and Small Efficiency Dwelling Units (SEDU) — has been in flux since re-emerging as an affordable alternative to market-rate studios in Seattle nearly a decade ago.

Although many renters seek out this class of small apartments, ranging from 175 to 375 square feet per unit, policy changes over the past few years have altered both the letter of the code and how it was interpreted by building officials. As a result, congregate units and micro studios are nearly impossible to develop in Seattle today.

This impact is evident in Seattle’s multifamily microhousing development pipeline, with only two pro