Seattle's Permit Fees Are Up 25% in Two Years. Small Projects Shouldn't Pay for the Slump.

Seattle's Permit Fees Are Up 25% in Two Years. Small Projects Shouldn't Pay for the Slump.

Seattle is about to ask the smallest builders in the city to pay more for the same permit, at the exact moment the city most needs them to build.

Mayor Katie Wilson's proposed 2027 budget would raise building and land use permit fees at the Seattle Department of Construction and Inspections (SDCI) by 10.7% [Check]. That follows an 18% increase that took effect in 2026. Put together, permit costs would be up more than 25% in two years. The Seattle City Council is reviewing the budget now, with a public hearing on November 5 and final adoption expected before Thanks giving.

We understand why. We also think the city can do better, and we want to say so while there is still time to change it.

Why fees are going up

SDCI runs mostly on permit fees, which fund about 91% of its budget. When big office towers and high-rise apartments were flowing through the pipeline, fees tied to project value kept the department healthy. That era is over for now.

SDCI expects 2026 to end with roughly 60% fewer master use permit applications than in 2019, a level lower than the bottom of the Great Recession. Construction permit volume is down about 15% from 2019. The projects still coming in the door are smaller and less complex, which means less revenue per permit. The department plans to cut 34 fee-funded positions, and its reserve fund has fallen from $80 to $100 million to a projected $30 million by the end of 2026.

So the department is raising rates on the customers it still has.

Who actually feels it

The Urbanist ran the numbers on two example projects. A 230-unit apartment building would see plan review and permit fees rise from about $274,500 in 2025 to about $347,900 in 2027, roughly 27%. A four-unit townhouse project would go from about $12,200 to about $16,000, roughly 31%.

For a large developer, $73,000 is a rounding error on a nine-figure project. For a homeowner adding a backyard cottage, or a family turning one lot into a fourplex so three generations can live close together, a few thousand dollars can be the difference between moving forward and waiting another year. Last year's increase alone added an estimated $543 to permit a 500-square-foot backyard cottage.

These are the projects we work on every week. They are the homeowners Seattle's new middle housing rules were written for. And they are the people least able to absorb another round of soft costs layered on top of 7% mortgage rates, tariff-driven material prices, and a utility connection process that can stretch for months.

What we'd ask the Council to consider

1. Protect small residential projects

A homeowner-scale project of four units or fewer should not carry the same percentage increase as a 200-unit tower. The Council could hold fee increases flat for small residential permits, or phase them in, while the department's revenue model is rebuilt.

2. Treat the shortfall as a policy problem, not a pricing problem

SDCI's revenue gap exists because large projects stopped. That is a regional economic issue. Asking a backyard cottage to fill the hole sends exactly the wrong signal. A one-time bridge from the general fund, or a temporary cap, would be fairer.

3. Keep the MHA accelerator moving

Councilmember Dionne Foster's proposed Mandatory Housing Affordability accelerator would temporarily cut MHA fees, by 80% for vested projects and 60% for new projects that break ground within two years. That is a good start. Pairing it with permit fee relief for small projects would make the message consistent: Seattle wants housing built now.

4. Tie fees to faster service

If applicants pay more, they deserve predictable timelines. Publish review targets for small residential permits and report on them every quarter.

What homeowners can do right now

If you are thinking about an ADU, a duplex, or a small multiplex, here is our honest advice.

• Run the numbers with 2027 fees in mind. Budget for permit fees at least 10% higher than 2026 quotes until the Council finalizes the budget.
• Get your application complete. Submitting a complete, well-coordinated application is the best protection against costly correction cycles, which add both time and fees.
• Speak up. The Council's November 5 public hearing is open to remote comment starting at 1 p.m. and in-person comment starting at 5 p.m. Three minutes from a homeowner who wants to build is powerful.
• Plan now, build when ready. Design and feasibility work done this winter positions you to submit quickly when the market and the fee picture are clearer.

Where we stand

La Union Studio believes code reform is equity work. Seattle opened its neighborhoods to middle housing so more families could stay, grow, and build wealth in the places they love. If the cost of a permit keeps climbing faster than anyone's paycheck, those new rules stay on paper.

The department needs to be funded. The people building one, two, or four homes at a time should not be the ones holding it up.

Let's plan your project together

Thinking about an ADU, a fourplex, or a family compound and wondering what it will really cost to permit in 2027? Book a consultation with La Union Studio. We'll walk through your lot, your budget, and your timeline, and help you decide whether to move now or plan for later.

This post shares our perspective on public policy and is not financial or legal advice.

FAQ

How much are Seattle permit fees going up in 2027?

Mayor Wilson's proposed 2027 budget would raise SDCI building and land use permit fees by 10.7%, following an 18% increase in 2026. The City Council is expected to finalize the budget in late November 2026.

Why is SDCI raising permit fees?

Permit fees fund about 91% of SDCI's budget. With far fewer large projects in the pipeline, the department is collecting less revenue per permit and is raising rates to cover staffing costs.

How can I comment on Seattle's 2027 budget?

The Seattle City Council holds a budget public hearing on November 5, 2026, with remote comment starting at 1 p.m. and in-person comment at 5 p.m. You can also email your councilmembers.

Sources: The Urbanist: Seattle Permit Fees Get Another Hike Amid Development Slump · The Urbanist: The 'Structural Change' About to Make Homebuilding More Expensive in Seattle · Seattle City Council: Council kicks off 2027-2028 budget process · Citizen Portal: Council approves SDCI fee update