Seattle-Area Microhousing Remains Resilient as Larger Residential Market Softens

Microhousing in the Seattle and Puget Sound region “continues to exhibit relative resilience in an otherwise softening residential landscape,” said Kidder Mathews’ Jerrid Anderson. “That said, investors should always keep a close eye on the supply and demand dynamics of each submarket.”

Anderson and Kidder Mathews colleague Dylan Simon recently issued their annual study on the region’s multihousing market. A major development this past year was the enactment of HB 1998, which requires Washington State cities and counties within urban growth areas to permit “co-living” housing in any zone that allows at least six multifamily residential units. This marks a complete reversal of the anti-microhousing bill that Seattle enacted in 2014, according to Kidder Mathews.

With regard to investment, Anderson said, “So far, there have been no microhousing sales in 2024. As the apartment investment market softened over the past few years, microhousing demand and values were deeply impacted. Since August, we’ve seen more competition and price escalation to buy apartments in Seattle, and as this continues into 2025, we expect the pricing pendulum for microhousing to swing back in the sellers’ favor.”

Don’t miss Connect Retail West happening on Wednesday, Nov. 6 in Los Angeles! Join the leading names and major industry players from ICSC, Caruso, Anderson Real Estate, Primestor, and more there. Be sure to register in advance; registration pricing increases on event day!