Don't Price Out the Fourplex: How Seattle Should Approach MHA in Neighborhood Residential Zones

Seattle needs more money for affordable housing and more homes of every kind. Those goals do not have to fight each other, but a proposal now in front of the City Council could set them on a collision course in the neighborhoods where homeowners are just starting to build middle housing.

In September, Councilmember Dionne Foster introduced a Housing Accelerator that would temporarily cut Mandatory Housing Affordability (MHA) fees to restart stalled apartment projects. Alongside it came a companion resolution asking staff to draft legislation applying inclusionary requirements, like MHA, to new market-rate housing in Neighborhood Residential (NR) zones, the former single-family zones that cover most of the city's residential land. NR zones are exempt from MHA today.

We support the accelerator. We also believe in inclusionary housing. And we think extending MHA to NR zones without a small-project threshold would be a mistake that falls hardest on the homeowners this new zoning was meant to help.

What the Housing Accelerator would do

Under the version discussed in committee, vested projects stuck in financing would get an 80% MHA reduction for two years, and new projects would get 60% if they submit a complete building permit application before January 1, 2028. Non-vested projects would need at least 25% family-sized units with two or more bedrooms, and every project would need to pass its first foundation inspection within two or three years or repay the full fee. The full fee would stay in place in displacement-risk areas, including the Chinatown-International District and Central District, with an exception for legacy homeowners whose deed has not changed since January 1, 2026. A final Council vote is expected in January 2027, after the budget.

The case for it is simple math. MHA brought in $11.7 million so far this year at the full fee, down from $67 million in 2020, according to PubliCola. Housing applications are down 94% since 2019. A smaller fee on homes that actually get built beats a full fee on homes that never break ground.

Why the NR resolution worries us

The same logic applies even more strongly to small projects in NR zones. A homeowner adding three homes to a South Seattle lot is not a developer with a balance sheet. They are often a family turning the equity in a long-held house into housing for their kids, their parents, or a rental income that lets them stay in the neighborhood.

The costs already stacking up

These projects already carry heavy city-mandated costs that have nothing to do with MHA. One recent analysis estimates a typical four-home project has absorbed more than $75,000 in new mandated costs since 2023, including about $33,400 in new water, wastewater, and drainage charges, plus $35,000 to $150,000 for Seattle City Light's underground service requirement. SDCI permit fees rose 18% last year, and the proposed 2027 budget adds another 10.7%. The same analysis estimates MHA on a four-home project could mean roughly $130,000 due before a building permit.

What happened last time

When MHA applied to small townhome projects in Lowrise zones, new townhome applications dropped sharply while single-family applications, which MHA does not cover, held steady. If NR middle housing follows the same pattern, Seattle could end up with more large single houses and fewer fourplexes, the opposite of what the 2025 zoning changes intended.

Equity is the reason to get this right

We work with many homeowners in South Seattle and South King County, including longtime BIPOC families who held on through decades of redlining's aftermath and rising taxes. For them, middle housing is one of the few tools that turns a paid-off house into generational stability without selling. A fee that makes a three- or four-home project pencil out only for well-capitalized builders shifts that opportunity away from the very households inclusionary zoning is meant to protect.

The resolution itself points in a careful direction. It says any fee should not "significantly deter development or investment," should stay flat for five years, and should consider excluding homes not built for rent or sale, such as ADUs. The Council's own summary adds a lower per-unit fee for projects built to full lot capacity and a share of revenue for permanently affordable homeownership. Those are good instincts. We want to see them written into law, not just intent.

What we would ask the Council to do

1. Set a small-project threshold

Most inclusionary programs in the country exempt small projects in some form. Portland's threshold is 20 homes and Denver's is 10, according to For Seattle's review. Seattle could exempt NR projects of four or fewer homes, or require fees only on homes beyond the base allowance.

2. Protect owner-led projects

Use the same legacy homeowner concept the accelerator uses. A household that has owned its lot for years and builds while staying on site should not pay the same as a speculative buyer.

3. Reward on-site affordability first

NR zoning already lets a lot reach six homes if at least two are affordable. Strengthen that path with faster review and fee credits so affordability gets built into neighborhoods instead of paid out of them.

4. Count the whole cost stack

Before setting any fee, publish a feasibility study that includes utility, undergrounding, and permit fees, not just MHA. The question is not whether one fee is reasonable. It is whether the total still lets a family build.

What homeowners can do now

Nothing has changed yet. The resolution directs staff work; it does not create a fee. If you have been thinking about middle housing, this is a good time to get a feasibility study and a schematic design underway, so you understand your options under today's rules. Projects that vest early often have more certainty about which fees apply. You can also share your story with your councilmember, especially if you are an owner-builder in South Seattle.

Let's build the neighborhood together

La Union Studio helps homeowners turn a single lot into homes for the people they love. If you want to know what your lot can hold, and what it will cost to get there, book a consultation with our team. We will walk through zoning, fees, and design options in plain language.

FAQ

Does MHA apply to Neighborhood Residential zones in Seattle today?

No. Neighborhood Residential zones, the former single-family zones, are currently exempt from MHA. A September 2026 Council resolution asks staff to draft legislation that could change that, but no fee has been adopted.

What is Seattle's MHA Housing Accelerator?

It is Councilmember Dionne Foster's proposal to temporarily cut MHA fees for two years: 80% for vested projects stuck in financing and 60% for new projects that meet conditions, with exclusions for displacement-risk areas. A final vote is expected in January 2027.

Should I wait to build a fourplex until the MHA question is settled?

Not necessarily. Design and feasibility work can move forward now, and getting into permitting early may give you more certainty about which rules apply. This is not legal or financial advice, so talk with your design team and a land use attorney about timing for your specific lot.

Sources: Seattle City Council: Foster proposes MHA accelerator · The Urbanist: Foster resurrects Housing Accelerator · Citizen Portal: committee discussion on eligibility and carve-outs · PubliCola: Foster breaks the MHA logjam · For Seattle: Yes to the Housing Accelerator, fix the resolution · The Urbanist: Seattle permit fees get another hike · SDCI Neighborhood Residential summary