05 Housing

HOUSING GOALS

• GOAL H–1 In Tacoma, housing is available and accommodates a full spectrum of needs, preferences, life stages, and financial capabilities. City policies, programs, and incentives encourage the production of housing types and affordability levels that are not being produced in the private market.

• GOAL H–2 Access to housing is made fairer and more equitable, with a special effort to remove disparities in housing access for Black, Indigenous, and People of Color, low-income households, older adults, and households that include people with disabilities.

• Goal H–3 Anti-displacement policies are coordinated to reduce the risk of displacement for at-risk households and mitigate impacts for households that face displacement.

• GOAL H–4 Across Tacoma, safe and healthy housing provides access to jobs, goods, and services that meet daily needs within a 15-minute walk. This housing is connected to the rest of the city and region by safe, convenient, affordable multi-modal transportation.

• GOAL H–5 All Tacomans can find suitable housing that does not incur cost burden.

• GOAL H–6 New housing units are low emission, energy efficient, built to high-performance standards, and well-integrated with their surroundings.

Housing

5.1 Introductory Context

WHAT IS THIS CHAPTER ABOUT?

The goals and policies in this chapter convey the City’s intent to:

• Implement Tacoma’s vision of neighborhoods that are inclusive, welcoming to a diverse community, resilient, thriving, distinctive, and walkable, and that include a range of housing choices and costs.
• Ensure fair and equitable access to a range of housing types for a socially and economically diverse population.
• Support healthy, resource-efficient, and physically accessible housing.
• Concentrate the highest densities of housing in centers and along high-capacity transit corridors, where access to transportation and services can reduce the cost of living and improve quality of life.
• Increase the amount of affordable housing, especially for lower-income families and households with special needs. Promote a supply of permanently affordable housing for Tacoma’s most vulnerable residents.
• Expand the number and location of housing opportunities, both market rate and subsidized, for households of all sizes throughout the city.
• Take proactive steps to address the impacts of systemic racism in housing and dismantle continuing racism where it exists.

The Future Land Use Map (See Exhibit 17 in Growth Strategy) allows for a more-than-adequate housing supply to meet future needs. Tacoma’s current challenge is to provide housing with a diverse range of unit types and prices in locations that help meet the needs of all, including low-income populations, communities of color, and people of all ages and abilities. To meet that challenge, Tacoma continues its transformation toward a refreshed vision for housing growth that promotes production of different housing types and sizes, clustered in locations that connect households to daily essentials and amenities.

WHY IS THIS IMPORTANT?

While a place to live is a basic human need, not all Tacomans have safe and healthy housing. Economic, social, and physical barriers limit many Tacomans’ access to adequate housing. Income, physical disabilities, immigration status, limited English proficiency, and discrimination based on race, sexual orientation, and other factors can also limit choices.

Book I: Core Policy Elements 1 | Introduction and Vision 2 | Growth Strategy 3 | Complete Neighborhoods 4 | Environment and Watershed Health 5 | Housing 6 | Transportation 7 | Economic Development 8 | Parks and Recreation 9 | Public Facilities and Services 10 | Historic Preservation 11 | Engagement and Administration

Contents 5.1 | Introductory Context 5.2 | Goals and Policies 5.3 | Priority Actions

ONE TACOMA Chapter 05: Housing

The City plays a crucial role in ensuring a fair and equitable housing market by setting policies that affect the overall supply of housing, the types of housing that get built, and where housing is built. These decisions and the resulting housing landscape create the opportunities and security all people need to live healthy and successful lives.

WHAT WE HEARD

Since the last update to the Comprehensive Plan, housing has been a significant topic of engagement efforts, due to the Affordable Housing Action Strategy, which encompasses Home in Tacoma and Rental Housing Code changes. These efforts asked community members across districts to voice their concerns and opinions on the state of housing affordability and housing supply in Tacoma. In the City’s 2024 Community Survey, when asked what their greatest concern was for their neighborhood, residents’ first response was homelessness, followed by affordable housing. Participants in the Home in Tacoma Survey describe the future of housing as neighborhoods with mature trees and green spaces, affordable housing at a range of income levels, a mix of historic and new buildings, infrastructure and services that keep pace with growth, and transportation choices that include walking, rolling, biking, and transit. Other popular policy levers that community members want are encouraging infill, detached-accessory dwelling units (DADUs), and accessory dwelling units (ADUs).

Overall, Tacomans sense a great deal of urgency and concern about housing affordability and homelessness in the city. However, broad engagement suggests an appetite for only very modest increases in density and the pace of development. Parking and traffic, preserving neighborhood character, views, open space, and associated infrastructure and services were some of the most common concerns.

HOW DOES THIS CHAPTER ADDRESS KEY THEMES?

Access to quality housing is a foundational human need. With safe and secure housing established, Tacoma residents can access further opportunities, including education and economic opportunities. People with stable housing are more able to contribute to the city’s vibrant cultural life, engage civically, and be well. On the other hand, housing instability or inadequate housing puts incredible stress on human capacity and collectively limits our potential as a city. (Equity and Opportunity)

In its most basic role as shelter from the elements, housing provides protection from injury and disease. As a core social determinant of health, the quality, affordability, and adequacy of housing supply affect whether people live in crowded conditions or are exposed to environmental hazards, such as poor indoor air quality and allergens. Housing quality and access are not only tied to physical health, but also to mental health outcomes. Being housed oneself and living in a community where one’s neighbors are securely housed contributes a great deal to psychological safety. People living in objectively higher-quality housing have a greater sense of safety in their neighborhoods. When people do not have housing, however, the damaging impact on both their psychological and physical safety drastically spikes, as community members who are unhoused are seven to ten times more likely to be the victims of violence than the general population (Meinbresse et al., 2014). (Public Health and Community Safety)

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EQUITY

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OPPORTUNITY

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PUBLIC HEALTH

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SAFETY

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SUSTAINABILITY

Policy decisions about housing development can have systemic impacts on climate and sustainability goals within a city. When housing, transportation, and economic development decisions are strategically aligned, greater transportation mode shifts to walking, biking, and transit occur, reducing congestion and GHG emissions on a large scale. Building codes also affect residential building design choices related to energy efficiency, sustainable material use, air pollution, and water management systems that have environmental impacts at scale. (Sustainability)

WHAT ARE SOME BASELINE CONDITIONS AND OPPORTUNITIES?

Tacoma’s housing production has not kept pace with growth targets. From 2017 to 2023, the city’s housing stock has grown at an average annual rate of 0.8% (Exhibit 37). To achieve the 2050 housing target, average annual growth needs to be double this, at 1.6%. Compared with Pierce County overall, Tacoma’s housing production has proportionally slowed since the 1980s, reflecting a countywide trend of population growth in areas outside this regional metropolitan hub.

Exhibit 37. Tacoma Housing Units, Actual and Target 2015–2050

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Sources: OFM Housing Units, 2015-2023; PSRC Housing Target for 2017-2050; Seva Workshop, 2024.

New housing development in Tacoma aligns with the City's goal of co-locating growth and development in nodes with the highest access to transit and opportunity. The map in Exhibit 38 visualizes housing production in Tacoma since 2017 by location and unit count. While Tacoma’s existing housing stock predominantly consists of single family homes (67%), recent production trends favor multidwelling housing, which comprises 80% of all units developed from 2017-2023. Newer housing production has been highest Downtown, where 40% of these new units are located. Another 30% of new housing units are located within the city's MUCs.

Exhibit 38. Tacoma Residential Building Permits by Unit Count, 2017–2023

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Tacoma’s recent housing production reflects the City’s growth strategy of promoting density, particularly in areas that are high-opportunity and transit-oriented. Since 2017, 80% of new housing units are in multidwelling developments, 40% are located Downtown, and 30% are located within the city’s other MUCs.

Sources: City of Tacoma, 2023; Seva Workshop, 2024

ONE TACOMA Chapter 05: Housing

In Tacoma, half of households own their homes while half of households rent.¹ However, affordability trends demonstrate that homeownership is becoming increasingly out of reach for moderate-income households as home prices have risen at more than double the rate of incomes from 2015-2023. First-time homebuyers are particularly hard-hit by the combined factors of increasing housing costs and mortgage lending rate spikes (Exhibit 39). Homeownership remains a path to building generational wealth for a family, and these higher costs raise the barrier to entry for many Tacoma households.

Exhibit 39. Housing Cost and Income Increases as a % Change from 2015 in Tacoma, Average Annual Mortgage Lending Rates 2015-2023

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Sources: Zillow Home Value Index and Observed Rent Index, Downloaded April 2024; WSHFC Area Median Income, 2015-2023; St Louis FED Mortgage Interest Rates, 2023; Seva Workshop, 2024

Racial disparity in homeownership is stark in Tacoma, steeped in a long history of racial exclusion and discrimination. These gaps persist among demographics for first-time homebuyers, indicating that the trend may worsen rather than improve in coming years.¹ The lowest homeownership rates today are observed among Black (32%), Pacific Islander (32%), Hispanic (43%), and households that identify as "Other race" (37%). (Exhibit 40). A detailed exploration of barriers to homeownership related to racial equity in Tacoma can be found in Chapter 6 of the attached baseline conditions report.

Exhibit 40. Tacoma Housing Tenure by Race and Ethnicity (% Share Owner and Renter Households), 2021

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Note: AIAN=American Indian and Alaska Native; NHOPI=Native Hawaiian and Other Pacific Islander. Hispanic or Latine is an ethnicity. The Hispanic or Latino category includes Hispanic and Latine people of all races. All other categories show non-Hispanic races.

Source: American Community Survey 5-year estimates; Seva Workshop, 2024

ONE TACOMA Chapter 05: Housing

Alongside the region, Tacoma is experiencing severe housing affordability challenges – 37% of households are cost-burdened from housing. Rates worsen for lower income brackets (Exhibit 41). Households that pay 30% or more of their income toward housing are considered cost-burdened. These households may struggle to cover other essential household expenses, such as transportation or healthcare. Households that pay 50% or more of their income towards housing are considered severely cost-burdened. In Tacoma, geographic trends for cost burden are observed, with concentrations in Central, South Tacoma, and South End neighborhoods. The map in Exhibit 42 explores the geographic distribution of rental housing cost burden.

Exhibit 41. Percent of Households Cost Burdened by Income Level in Tacoma, 2020

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Note: Cost-burdened households spend between 30-50% of income toward housing. Severely cost-burdened households spend more than 50% of gross income for housing.

Sources: CHAS dataset based on American Community Survey 5-year estimates 2016-2020; Seva Workshop, 2024

ONE TACOMA Chapter 05: Housing

Exhibit 42. Distribution of Renter Cost Burdened-Households in Tacoma, as a % of Block Group Population, 2020

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Sources: CHAS dataset based on American Community Survey 5-year estimates 2016-2020; Seva Workshop, 2024

ONE TACOMA TACOMA 2050 5-328

Renters experiencing housing cost burden are at higher risk of displacement when rents increase. In 2024, the City of Tacoma adopted an Anti-Displacement Strategy that outlines policies and programs that address housing stability for vulnerable residents. These strategies address three types of displacement: physical displacement, occurring when building conditions change like in case of natural disaster, condemnation, or eminent domain; economic displacement, when housing cost increases are dramatic enough that a resident must move or is evicted; and cultural displacement, when a household moves because the businesses/services/community that cultivate a sense of belonging for them are no longer present. As part of the Anti-Displacement Strategy, Tacoma studied displacement risk mapping exercised completed by the Department of Commerce, the Puget Sound Regional Council, UC Berkeley Urban Displacement Project, Evictions Study Map, and the City’s own Equity Index¹. Under these displacement definitions and considering the findings of these five studies, the strategy identifies particular displacement risk:

• Geographically, in the Hilltop neighborhood and in parts of South and East Tacoma
• Racially, as people of color are shown to be at higher displacement risk than White residents

Additional summary and study of displacement trends and policy response to these trends can be found in the attached baseline conditions report, starting on page 5-189.

Market interventions will be essential to support housing units for lower income brackets. In visioning a future without housing cost burden or homelessness in Tacoma, 30% of all new units should be affordable to extremely low-income households, 34% for low- and very low-income households, and the remainder for moderate- and higher-income households. The distribution is based on Pierce County allocations and considers current housing needs to eliminate cost burden and homelessness, as well as the needs of future households. The production of income-restricted affordable housing is the most reliable way to meet the needs of households in the lowest income brackets, which are typically not well served by market-rate housing production. As shown in Exhibit 43, this unit mix is a dramatic departure from the affordability levels found within Tacoma’s existing housing stock, where only 45% of housing units are affordable to those with incomes at or below 30% AMI, and only 11% of units are affordable for very low-income households. In addition to the need shown in this table, 2,670 additional emergency housing beds are needed in the 2020-2044 timeframe.

Exhibit 43. Housing Units Needed by Income Bracket in Tacoma, 2020-2044, Compared with Existing Housing Unit Mix by Income Bracket, 2020

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Housing need of 42,865 units, 2020-2044

Existing mix of housing units by income bracket, 2020

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Sources: Pierce County Countywide Planning Policies 2023-22 Appendix A; Seva Workshop, 2024

What does “low income” mean?

Area Median Income (AMI) is calculated at a number of geography scales, depending on the intent and use of the data. The below scale shows 2024 AMI levels and affordable rent calculations for a household of three, as defined by the Washington State Housing Finance Commission for Pierce County. Anyone who meets the income threshold but pays more than the shown amount for housing is considered housing cost burdened.

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Overall housing production increase is a key strategy to addressing affordability in Tacoma. A healthy supply of new housing, even when it’s market rate and serving moderate or higher income brackets, allows for a natural “filtering” process to evolve, where units currently occupied by high-income households are sold to more moderate-income households, freeing up the moderate-income units for low-income households. Without adequate production, the housing supply is squeezed, and high-income households drive up the cost of all housing by occupying units that might otherwise be home to moderate-income households, market rate production does not directly address the needs of households in the lowest income groups, but does help maintain better alignment for the other segments of the housing market. This frees up more resources to be spent on those with the greatest need.

The market rate housing market will never fully address the needs of very-low and extremely low-income households. Tacoma has demonstrated a need for more units that serve these income brackets without incurring cost burden and for permanent supportive housing units. These housing types require public subsidies and funding support. Tacoma, in 2019, established its Affordable Housing Fund (authorized by SHB 1406), which allocates a portion of sales tax that would otherwise go to the State back to the City, for use supporting affordable housing work. In 2023, Pierce County initiated a sales tax increase to raise additional funds to be spent on addressing the housing needs of those at or below 60% AMI in the county⁵. Still, a wide gap remains in acquiring funds needed to fully meet the need in the city and region. A full analysis of Tacoma’s housing market baseline can be found in the technical report for this element.

5.2 Goals and Policies

GOAL H-1: In Tacoma, housing is available and accommodates a full spectrum of needs, preferences, life stages, and financial capabilities. City policies, programs, and incentives encourage the production of housing types and affordability levels that are not being produced in the private market.

Policy H-1.1: Maintain sufficient residential development capacity to accommodate Tacoma’s housing targets. Update infrastructure and services as needed to support urban growth.

Policy H-1.2: Encourage new and innovative housing types that meet the evolving needs of Tacoma households and expand housing choices in all neighborhoods. These housing types include multi-dwelling units, and from duplexes to high-rise developments, small units, accessory dwelling units, prefabricated homes, such as manufactured and modular, co-housing, and clustered housing.

Policy H-1.3: Support the maintenance and improvement of the existing housing stock, and encourage the adaptation of the existing housing stock to accommodate a variety of needs.

Policy H-1.4: Monitor housing trends including production, unit type, affordability levels, and geographic distribution. Adopt zoning changes as needed that align with the goals of this element.

Policy H-1.5: Encourage a robust and diverse supply of affordable, accessible housing to meet the needs of special populations, including emergency housing, emergency shelters, transitional housing, and permanent supportive housing for individuals and families experiencing homelessness, especially in centers and other places in close proximity to services and transit.

Policy H-1.6: Reduce housing instability and homelessness within Tacoma by advancing Housing First programs and implementing the City’s Homelessness Strategy.

Policy H-1.7: Implement equitable land use incentives, such as density or development bonuses, lot size reductions, TDR, height or bulk bonuses, fee waivers, accelerated permitting, parking requirement reductions, tax incentives, and “surplus land sales,” to remove housing development barriers for income-restricted affordable housing and other housing types serving cost-burdened communities.

Policy H-1.8: Review and update affordable housing incentives and requirements, such as those listed in H-1.7, to improve their efficacy and impact.

Policy H-1.9: Create a process to coordinate public investments, such as capital improvements, with affordable housing activities to leverage the most benefit from public investment.

Policy H-1.10: Track housing production trends to assess progress toward goals related to updated design standards and zoning changes, particularly for infill and middle-density housing types.

Policy H-1.11: Review and update City permitting and processes, as well as available education and technical support, to streamline the homebuilding process for developers and the public.

Policy H-1.12: Support the exploration and potential development of a community-led social housing developer to help address identified gaps in housing production by income level and support a range of affordability options to meet growth targets. This entity should prioritize the creation of permanently affordable housing for households earning less than 80% of the AMI, with a particular focus on serving marginalized communities. To ensure long-term viability, the entity should pursue financial sustainability through a mix of unit types and price points in projects, including some market-rate units. The City encourages such developments to incorporate high levels of energy efficiency and performance standards. When public revenues are utilized, the City should prioritize maintaining public ownership of these developments. City staff and decision makers should seek, when able, to exchange knowledge with successful social housing initiatives through presentations, expert consultation, and/or site visits to better understand best practices.

GOAL H-2: Access to housing is made fairer and more equitable, with a special effort to remove disparities in housing access for Black, Indigenous, and People of Color households, low-income households, older adults, and households that include people with disabilities.

Policy H-2.1: Implement barrier-free access to housing consistent with the Americans with Disabilities Act (ADA). Increase access by actions such as implementing visitability and universal design features, considering details in individual units, on-site plans, and more broadly at the neighborhood scale.

Policy H-2.2: Sustain and increase, when possible, funding for eviction, relocation, and foreclosure prevention programs.

Policy H-2.3: Continually evaluate plans, investments, and other legislative land use decisions to identify potential disparate impacts on housing choice and access for protected classes.

Policy H-2.4: Evaluate plans and capital investments for potential unintended consequences, such as displacement in areas with concentrations of communities of color, low- and moderate-income households, and renters.

Policy H-2.5: Ensure a range of housing options and supportive environments to enable older adults to remain in their communities as their needs change.

Policy H-2.6: Expand tenant protections by providing resources for households experiencing a crisis, increasing community organizing capacity, and supporting existing code that requires residential landlords to provide sufficient notice of rent increases, informs tenants of their rights under the law, and provides relocation assistance if rent increases exceed a defined limit.

Policy H-2.7: Promote equitable access to opportunity for persons with disabilities by prioritizing supplemental housing assistance for accessible units in centers and complete neighborhoods with frequent transit.

HOW DOES THIS PLAN SUPPORT HOMEOWNERSHIP AND HOUSING AFFORDABILITY?

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THE AVERAGE TOWNHOME SELLS FOR 31% LESS THAN A SINGLE FAMILY HOME, AND A CONDO FOR 18% LESS

ANALYSIS OF AFFORDABILITY TRENDS SHOW THAT HOMEOWNERSHIP TODAY IS MORE OUT OF REACH FOR MODERATE-INCOME HOUSEHOLDS IN TACOMA THAN IT WAS FIVE YEARS AGO, AND THAT RACIAL DISPARITIES IN HOMEOWNERSHIP RATES PERSIST AND ARE WORSENING FOR SOME GROUPS.

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RECENT ZONING REFORM IN TACOMA DRAMATICALLY INCREASES THE CITY'S CAPACITY FOR NEW HOUSING. THIS CAN RELIEVE PRESSURE ON SUPPLY AND RESTORE BALANCE IN THE HOUSING MARKET, ENSURING THAT TACOMA CAN REMAIN A COMMUNITY THAT IS HOME FOR ESSENTIAL WORKERS, HOUSEHOLDS WITH MODERATE INCOMES, BIPOC FAMILIES, AND FAMILIES OF ALL SIZES.

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THE 15-MINUTE CITY VISION IN TACOMA SIGNIFICANTLY EXPANDS THE FOOTPRINT OF LAND AVAILABLE FOR DEVELOPMENT AS MIDDLE HOUSING TYPES, SUCH AS TOWNHOMES, THAT CAN BE MORE ACCESSIBLE FOR FIRST-TIME HOME BUYERS.

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THIS PLAN CONSIDERS FUTURE HOUSING NEEDS NOT AS A MONOLITH, BUT ACROSS THE INCOME SPECTRUM. THAT MEANS ACKNOWLEDGING THE DRAMATIC NEED FOR MORE PERMANENT SUPPORTIVE HOUSING, EMERGENCY SHELTERS, AND SUBSIDIZED HOUSING IN THE COMMUNITY, ENVISIONING A FUTURE WITHOUT CHRONIC HOMELESSNESS OR HOUSING COST BURDEN.

HOMEOWNERSHIP RATES BY RACE / ETHNICITY

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GOAL H-3: Anti-displacement policies are coordinated to reduce the risk of displacement for at-risk households and mitigate impacts for households that face displacement.

Policy H-3.1: Use a full spectrum of housing tools to address anti-displacement needs, such as funding for affordable housing.

Policy H-3.2: Implement inclusionary zoning in submarkets with supportive market conditions tailored to specific affordability needs and economic context. Recalibrate terms of the program on a rolling basis in response to changes in the housing market.

Policy H-3.3: Require that developers benefiting from land use changes, property tax exemptions, fee waivers, expedited processing, and City funding use affirmative marketing in advertising unit availability.

Policy H-3.4: Implement a resident prioritization policy that applies to both residents and neighborhoods with high displacement risk.

Policy H-3.5: Promote ownership opportunities to qualified first-time homebuyers as a pathway for wealth-building.

Policy H-3.6: Promote multidwelling housing units with two or more bedrooms, particularly in areas where they are in short supply.

Policy H-3.7: Working with local architects and lenders, create a set of affordable ADU designs and a financing package to facilitate the construction of, or subdivision to, ADUs by moderate- and low-income households.

Policy H-3.8: Require the redevelopment of large parcels with City investment to include deeply affordable rental and/or ownership products.

Policy H-3.9: Support businesses at risk of displacement by providing City subsidies for leases, implementing first rights of refusal for City-subsidized commercial in redeveloped sites, and/or offering relocation assistance.

Policy H-3.10: Continue to identify and address racially disparate impacts, displacement, and exclusion in Tacoma's community.

Policy H-3.11: Engage with BIPOC community members, and others who have been historically underrepresented, in policymaking. Provide stronger community-based roles for policy design and implementation of anti-displacement policies.

GOAL H-4: Across Tacoma, safe and healthy housing provides access to jobs, goods, and services that meet daily needs within a 15-minute walk. This housing is connected to the rest of the city and region by safe, convenient, affordable multi-modal transportation.

Policy H-4.1: Meet the housing needs of underserved and underrepresented populations living in areas with higher poverty rates, such as South Tacoma, Eastside, and South End, by coordinating plans and investments with housing programs, mobility improvements, and anti-displacement measures. Ensure that community engagement is integral to planning decisions to align investments with local interests and needs.

Policy H-4.2: Promote housing that is protected from noise and hazardous environmental conditions and materials, and improve conditions for existing housing in locations exposed to hazards.

Visitability captures the features that make a dwelling unit accessible to someone who has trouble with steps or who uses a wheelchair. These features include zero-step entrances, wider clearances at doorways, and a wheelchair accessible restroom on the main level.

Universal design is a broader concept that can apply to a full building, site design, or neighborhood layout. The goal is to create spaces that are inherently usable by as many people as possible without needing special adaptation. A universal design framework will consider a full range of mobility conditions, sensory differences, and cognitive impediments.

Policy H-4.3: Promote higher density, multidwelling development at designated centers and along high-frequency transit corridors, as shown in Exhibit 22 and 24 included in the Growth Strategy element.

Policy H-4.4: Preserve affordable homeownership and housing stability for low-income renters in high-opportunity areas through actions such as home improvement loans, downpayment assistance, subsidized utility rates, and actions.

Policy H-4.5: Provide incentives to promote the development of affordable, mixed-income housing citywide, with special focus toward areas identified on the Frequent Transit Network Vision Map in Exhibit 24. Discourage the over-concentration of facilities for “high-risk” populations in any one geographic area.

GOAL H-5: All Tacomans can find suitable housing that does not incur cost burden.

Policy H-5.1: Preserve and produce income-restricted affordable housing to address gaps in the housing supply not met by the private market, especially below 60% AMI. Coordinate with housing providers and service organizations to address community needs and disrupt patterns of displacement and cycles of homelessness.

Policy H-5.2: To eliminate housing cost burden and homelessness, 70% of units added in 2020-2044 in Tacoma should be affordable to households at or below 100% of Pierce County AMI, as summarized by Washington State Finance Housing Commission (Exhibit 40). Meet this through increased resources for affordable housing development, zoning, and land use incentives.

Policy H-5.3: Evaluate plans and investments across City departments for their impact on housing cost; implement anti-displacement measures for cost-burdened communities when investments indicate displacement risk; and consider ways to reduce the combined cost of housing, utilities, and/or transportation for impacted residents.

Policy H-5.4: Encourage income diversity across the city by allowing a mix of housing types and tenures in all neighborhoods.

Policy H-5.5: Support regional cooperation, often facilitated through South Sound Housing Affordability Partners, in addressing housing needs in the Tacoma metropolitan area and the greater the Puget Sound, especially for emergency and permanent supportive housing, low- and moderate-income households, and historically underserved and underrepresented communities.

Policy H-5.6: Ensure that a continuum of safe and affordable housing opportunities, related supportive services, and trauma-informed care are allowed and appropriately resourced. Eliminate racial disparities among those experiencing homelessness and connect individuals with holistic care teams. Support efforts for humane and robust homelessness crisis response.

Policy H-5.7: Increase homeownership rates and expand locational choice for BIPOC households and other groups who have been historically underserved and underrepresented as homeowners in high opportunity areas.

Policy H-5.8: Facilitate a variety of ownership opportunities and choices by allowing and supporting the creation of condominiums, cooperatives, mutual housing associations, limited equity cooperatives, community land trusts, and sweat equity.

Policy H-5.9: Create a local source of revenue and pursue a variety of other funding sources to preserve and develop housing units and various assistance programs for households whose needs are not met by the private market.

Policy H–5.10: Prioritize entitlement and permit applications for projects that offer at least 20% of their units at levels serving 70% AMI or below by moving applications to the front of the queue and dedicating staff with affordable housing development and/or financing expertise to expedite the review period.

Policy H–5.11: Establish new code to create a program to offer surplus property to affordable housing development partners (i.e. housing authorities, non-profit developers, and Indigenous housing partners) for the development of affordable housing serving households at 70% AMI or below. Adopt rules and guidelines to support the selection of these partners based on criteria (e.g. levels of affordability served, at-risk populations served, design standards, and incorporating transit-oriented development standards into the affordable housing project).

GOAL H–6: New housing units are low emission, energy efficient, built to high-performance standards, and well-integrated with their surroundings.

Policy H–6.1: Update building standards to support housing that provides features supportive of healthy and active living, such as high indoor air quality, useable open areas, connection to recreation areas, community gardens, and crime-preventative design.

Policy H–6.2: Promote low emissions, energy efficiency, green building practices, materials, and design to produce healthy, efficient, durable, and adaptable homes.

Policy H–6.3: Encourage the adaptive reuse of resource-rich existing older commercial buildings in or near designated centers into mixed-use housing developments to prevent carbon emissions from demolition and construction of new buildings.

Policy H–6.4: Connect residential areas with pathways, sidewalks, and high-quality onsite amenities, such as secure bicycle parking and electric vehicle charging.

Policy H–6.5: Require site designs and relationships to adjacent developments that reduce or prevent social isolation, especially for groups that often experience it, including older adults, people with disabilities, communities of color, and immigrant communities.

Policy H–6.6: Support a strong housing code enforcement program to reduce substandard housing through repair and rehabilitation, such as an active rental inspection program.

Policy H–6.7: Promote the maintenance, repair, rehabilitation, and adaptive reuse of the city’s existing housing stock. Pursue financial incentives and funding for housing improvement programs, subdivision, and adaptive reuse, especially for low-income households. Integrate regulatory tools that incentivize reuse and conversion of existing viable structures into housing to meet community needs.

Policy H–6.8: Promote innovative development techniques to better utilize land, promote design flexibility, preserve open space and natural features, and conserve energy resources.

In 2024, the City of Tacoma adopted an Anti-Displacement Strategy that outlines policies and programs that address housing stability for vulnerable residents. These strategies address three types of displacement: physical displacement, occurring when building conditions change like in case of natural disaster, condemnation, or eminent domain; economic displacement, when housing cost increases are dramatic enough that a resident must move or is evicted; and cultural displacement, when a household moves because the businesses/services/community that cultivate a sense of belonging for them are no longer present.

5.3 Priority Actions

Technical Report

City of Tacoma, Washington

ONE TACOMA

A Comprehensive Plan for a Vibrant, Connected, and Sustainable City

Housing Baseline Report | June 2025

CONTENTS

1 Inventory 4 1.1 Housing Stock 4 Units for moderate, low, very low, and extremely low-income households 12 1.2 Affordability 15 Ownership Housing 15 Rental Housing 16 Household Incomes 17 Affordability 20 Cost Burden 21

2 Projected Housing Need 25 2.1 Growth targets 25 Distribution of targets across income brackets 25

3 Land Capacity 27 3.1 Existing land capacity for housing 27 Zoning 29 Capacity Analysis 37 3.2 Home in Tacoma 45

4 Programs and Policies 47 4.1 Identifying barriers to affordability and availability of housing 47 4.2 Addressing barriers, gaps, and needs 49

5 Access to employment 52

6 Racial equity in housing policy 55 6.1 Racially disparate impacts 55 6.2 Displacement 58 6.3 Exclusion 61 6.4 Policy Audit 64

EXHIBITS

Exhibit 1: Tacoma Housing Units, 2017-2023 4 Exhibit 2: Tacoma Housing Units by Type, 2021. 5 Exhibit 3: Housing Production in Tacoma by Type, 2017-2023. 6 Exhibit 4: Multifamily Units by Size of Building, New Production in Tacoma 2017-2023. 6 Exhibit 5: Map of Tacoma Residential Permits, 2017-2023. 7 Exhibit 6: Accessory Dwelling Units Permitted and Constructed in Tacoma, 2019-2023. 8 Exhibit 7: Tacoma Housing Tenure by Race and Ethnicity (Shown as %), 2021. 9 Exhibit 8: Tacoma Population Density, 2021. 10 Exhibit 9: Tacoma and Pierce County Housing Stock by Building Age, 2021. 11 Exhibit 10: Households by Income Bracket, Tacoma, 2020. 13 Exhibit 11: Matching Housing Types with Income Brackets 13 Exhibit 12: Homelessness Counts in Pierce County, 2017-2022. 14 Exhibit 13: Tacoma Average Home Prices, Annual Change (%), 2015-2023. 16 Exhibit 14: Average Rents in Tacoma, 2015-2023. 17 Exhibit 15: Median Household Income by Race & Ethnicity, 2021. 18 Exhibit 16: Median Household Income by Census Tract in Tacoma, 2021 19 Exhibit 17: Housing Cost and Income Increases as a % Change from 2015 in Tacoma, Average Annual Mortgage Lending Rates 2015-2023. 20 Exhibit 18: First-time Homebuyers in Tacoma by Race & Ethnicity, 2022. 21 Exhibit 19: Percent of Households Cost Burdened by Tenure, 2020. 22 Exhibit 20: Renter Households Cost Burdened in Tacoma (%), by Race & Ethnicity, 2020. 22 Exhibit 21: Distribution of Renter Cost Burdened-Households in Tacoma, as a % of Block Group Population, 2020 23 Exhibit 22: Renter Cost Burden by Race/Ethnicity and Neighborhood in Tacoma, 2020. 24 Exhibit 23: Tacoma Housing Units, Actual and Target 2015-2050. 25 Exhibit 24: Housing Units Needed by Income Bracket in Tacoma, 2020-2044. 26 Exhibit 25: Land Use Designations that Allow for Residential Uses, % of Total Acreage. 27 Exhibit 26: City of Tacoma Land Use Designation Map, 2023. 28 Exhibit 27: West End Zoning Districts 29 Exhibit 28: North End Zoning Districts 30 Exhibit 29: Central Zoning Districts 31 Exhibit 30: New Tacoma Zoning Districts 32 Exhibit 31: North East Zoning Districts 33

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Exhibit 32: South Tacoma Zoning Districts 34 Exhibit 33: South End Zoning Districts 35 Exhibit 34: Eastside Zoning Districts 36 Exhibit 35: Tacoma Residential Land Capacity, by Zone, 2022. 37 Exhibit 36: Tacoma Housing Capacity, 2022. 38 Exhibit 37: Tacoma Zoning Districts Categorized by Typical and Allowed Housing Types 39 Exhibit 38: Income Bands Associated with Zoning Categories 40 Exhibit 39: Tacoma Residential Land Capacity by Income Band, 2020-2044 Targets 41 Exhibit 40: Emergency Housing Land Capacity Analysis 42 Exhibit 41: Middle Housing Types across Residential Zones (permit type - minimum lot area in SF) 43 Exhibit 42: Special Needs Housing Types as Permitted Uses in Tacoma 44 Exhibit 43: City of Tacoma Areas Zoned as R-4-L. 45 Exhibit 44: Housing Production Trends by Income Level, 2011-2021, Compared To Needed Production Levels for Targets 2020-2044. 47 Exhibit 45: Available Funding and Needed Funding for Affordable Housing, Pierce County, 2022. 48 Exhibit 47: Tacoma Inflow/Outflow Analysis, 2021. 53 Exhibit 48: Means of Transportation to Work, 2021. 54 Exhibit 49: Means of Transportation to Work by Race and Ethnicity, 2021. 54 Exhibit 50: People of Color as a Proportion of the Population in Tacoma, 2021. 56 Exhibit 51: Tacoma “Residential Security Map”, 1937. 57 Exhibit 52: Percent Change of Owner and Renter Households by Race, in the City of Tacoma 1990- 2020. 58 Exhibit 53: Displacement Risk Mapping in Tacoma, Draft 2024. 59 Exhibit 54: Location Quotient, Asian, Black, Hispanic Latino, White Alone 63 Exhibit 55: Policy Audit of the 2015 Comprehensive Plan Housing Element 66

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EXECUTIVE SUMMARY

Tacoma’s housing production has not been keeping pace with growth targets.

From 2017-2023, Tacoma’s housing stock has grown at an average annual rate of 0.8%. To achieve the 2050 housing target, average annual growth needs to be double this, at 1.6%. Tacoma’s housing production has proportionally slowed since the 1980s, when compared with Pierce County overall. Today, 64% of Tacoma housing units predate 1980 compared to 43% of the overall Pierce County housing stock. This reflects a countywide trend of population growth outside this regional metropolitan hub.

The existing housing stock is older and predominantly single family structures, while new production favors multifamily development.

Two-thirds of housing units in Tacoma (67%) are single family homes. However, when looking at housing built in recent years, 80% of units are in multifamily structures. Two-thirds of multifamily units are in larger buildings (50 units or more), and one-third are units in smaller and midsized multifamily structures. Downtown is a growing center for housing units, representing 40% of units built 2017-2023. North East and Central Tacoma are growing at the slowest pace.

There is racial disparity for homeownership in Tacoma, and this wealth-building opportunity is increasingly out of reach for moderate income households.

50% of Tacoma households are homeowners, but this rate is not consistent across race and ethnic groups. Homeownership rates are lowest among Black, Pacific Islander, Hispanic and “Other” households. This disparity is steeped in a history of racial exclusion and discrimination. Impacts from historic factors, such as redlining and racially restrictive covenants are still observed today. Modern phenomena, such as the foreclosure crisis, discriminatory lending practices, and lack of access to credit (to name a few) continue to block many People of Color from homeownership in Tacoma, and the city’s Black community is particularly hard hit.

Forty-eight percent (48%) of Tacoma renters experienced housing cost burden in 2020, along with 27% of homeowners.

Cost burden rates for renters are particularly high (over 65%) in certain areas across the City, with highest concentrations in Central, South Tacoma, and the South End. Patterns in racial disparity are observed geographically for cost burden, as well. Black households experience the highest rates of cost burden in North East, South Tacoma, and the West End. Asian households have relatively lower rates of rental cost burden across most of Tacoma, but a concentration of cost-burdened Asian renters live in the North End. Hispanic renters are most cost-burdened in Central, Eastside, and South Tacoma neighborhoods.

Production of 42,865 units is needed in Tacoma by 2044 to meet housing targets. Market interventions will be essential to support housing units for lower income brackets.

From this target, 30% of units should be affordable to extremely low-income households, 34% for low- and very low-income households, and the remainder for moderate- and higher-income households. The distribution is based on Pierce County allocations and takes into account current housing needs to eliminate cost burden and homelessness, as well as the needs of future households. These production targets envision a future with no housing cost burden and no chronic homelessness in Tacoma.

Better integration of housing and employment centers could improve rates of commuting by public transit, bike, or walking.

Tacomans who commute are overwhelmingly traveling by car, and only 2% of employees walk to work. These patterns reflect a disconnect between residential centers and employment opportunities. It also demonstrates room for improvement in transit capture – currently only at 6%. Transit ridership rates are highest among Black and AIAN commuters and lowest among White and “Other” groups. Improved connections could be built by adding more housing in proximity to employment centers, as well as improvements to transit and bicycle networks.

Data Source Summary

1 INVENTORY

1.1 Housing Stock

Tacoma has 94,531 housing units.¹ Since 2017, Tacoma’s base years for tracking its housing targets, the housing stock has increased by 4,588 units, reflecting an annual growth rate of 0.8%. Tacoma’s 2017-2050 target for housing is to add 59,052 units which reflects an annual growth rate of 1.5% across the time period, a much faster pace of increase than experienced in these first six years. As of 2023, Tacoma needs to add a net new 54,464 housing units by 2050 to meet targets.

Exhibit 1: Tacoma Housing Units, 2017-2023

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Sources: OFM, 2024; Seva Workshop, 2024.

Housing Units, by Type

Tacoma’s housing stock is approximately 2/3 single family homes with the remaining 1/3 split across middle housing types and multifamily units in a range of building sizes. Specifically, 6% of units are in townhomes or duplexes, 12% are in small multifamily buildings (5-20 units), 5% are in midsized multifamily buildings (20-49 units), 9% are in lager multifamily buildings (50+ units), and less than 1% of are mobile/manufactured homes. See Exhibit 2.

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Exhibit 2: Tacoma Housing Units by Type, 2021.

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Sources: ACS 5-year estimates, 2021; Seva Workshop, 2024.

Recent trends in housing production for Tacoma lean to higher proportions of multifamily housing, which makes up 80% of units developed 2017-2023. Over this timeframe, Tacoma averaged new unit production at a rate of 867 units/year.¹ Although the City’s permit data groups together middle housing types such as townhomes and multiplexes under the ‘multifamily’ category. Of the multifamily production, most are in buildings with 50+ units. About a quarter are in midsized multifamily buildings, and 9% of units are in smaller multifamily buildings. A summary of annual production rates 2017-2023 is provided in Exhibit 3 with detail on multifamily production in Exhibit 4. Single family homes make up 15% of new housing stock, duplexes 3%, and ADUs 2%.

Newer housing production is highest Downtown, accounting for 40% of new units produced since 2017. The West End, South End, and North End are the next neighborhoods for new unit counts, with 11% of production each. Lowest production rates are observed in North East (3%) and Central (6%) neighborhoods. See map in Exhibit 5.

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Exhibit 3: Housing Production in Tacoma by Type, 2017-2023.

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■Single-Family ■Multi-Family ■Duplex ■Accessory Structure

Note: City permit data for production does not take into account demolitions and works in a different annual data collection cycle than OFM. OFM estimates should be used for tracking total housing stock estimates. Sources: City of Tacoma Permit data, 2017-2023; Seva Workshop, 2024.

Exhibit 4: Multifamily Units by Size of Building, New Production in Tacoma 2017-2023.

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Sources: City of Tacoma Permit data, 2017-2023; Seva Workshop, 2024.

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Exhibit 5: Map of Tacoma Residential Permits, 2017-2023.

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Source: Tacoma Permit Data, 2017-2023.

Accessory Dwelling Units

Accessory dwelling units, or ADUs, are an important component to a community’s housing stock. They offer flexibility for homeowners to live multi-generationally or with caregiving support, to supplement income by renting the additional unit, and to meet a variety of other personal and familial needs. ADUs that become rental units are often priced at affordable

rates and may offer access to new neighborhoods that are predominantly occupied by homeowners.

ADUs are permitted across residential districts in Tacoma. Attached and detached ADUs are permitted on any lot, provided that site standards for size, setback, open space, and other requirements are met. The size of ADUs is limited to 1,000 SF or 85% of the area of the main building, whichever is smaller. The maximum height of structures is 18’ or 20’ if parking is incorporated.¹

From 2019-2023, 421 ADU permits were issued and 269 ADUs were reported as constructed in Tacoma. See Exhibit 6. ADU policies in Tacoma were revamped in 2019 and subsequently amended in 2021 to make it easier and more affordable for homeowners to add these units to their property. ADU production is on the rise and the City is working to make the process as streamlined as possible. Still, the capital investment needed to create these units can be prohibitive and not all residential lots are a good fit for this use. ADUs represent one component in the larger picture of providing housing options that meet the needs and affordability levels of a diverse community.

Exhibit 6: Accessory Dwelling Units Permitted and Constructed in Tacoma, 2019-2023.

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Sources: City of Tacoma Permit Data, 2019-2023; Seva Workshop, 2024.

Housing Tenure

Overall in Tacoma, 50% of households are owners and 50% of households are renters. Patterns of racial disparity are observed in Tacoma’s homeownership rates, with lowest rates of ownership among Black (32%), Pacific Islander (32%), “Other” (37%), and Hispanic (43%)

groups. Highest rates, by contrast, are found among Asian (62%) and White (61%) households. See Exhibit 7. In 2021, the City of Tacoma completed an in-depth study into its racial disparities related to housing. This report notes the decline in Black homeownership during the 30-year period from 1990-2020, while all other racial groups experienced increased or stable rates. It also analyzes lending data that demonstrates low rates of mortgage loan approvals for Black applicants.¹ Homeownership rates are important, as this is the most common avenue toward wealth building for American households.

Exhibit 7: Tacoma Housing Tenure by Race and Ethnicity (Shown as %), 2021.

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Note: AIAN=American Indian and Alaska Native; NHOPI=Native Hawaiian and Other Pacific Islander. Hispanic or Latine is an ethnicity. The Hispanic or Latino category includes Hispanic and Latine people of all races. All other categories show non-Hispanic races. Source: American Community Survey 5-year estimates; Seva Workshop, 2024.

Geographic Distribution

Tacoma’s residential centers are distributed across the city, as shown in Exhibit 8. Central Tacoma, Eastside, and South End have the greatest land areas with higher population density, more than 6,000 people per square mile. The neighborhoods of West End, South Tacoma, and North East are less densely populated though every neighborhood except for New

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Tacoma has at least one densely populated area. Incorporated areas surrounding Tacoma to the northeast, south, and west demonstrate similar patterns.

Exhibit 8: Tacoma Population Density, 2021.

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Source: American Community Survey 5-year estimates (2017 to 2021).

Building Age

Tacoma’s housing stock skews older, with 43% of structures built prior to 1960. Production rates in Tacoma slowed in the 2000s - less than 15% of units have been built 2000

or later. By contrast, Pierce County overall has only 20% of its housing stock built prior to 1960 and 25% of units have been built 2000 or later.

Exhibit 9: Tacoma and Pierce County Housing Stock by Building Age, 2021.

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Sources: American Community Survey 5-year estimates (2017 to 2021); Seva Workshop, 2024.

HOMES THAT NEED REPAIRS

ACS reports on housing issues such as homes lacking complete plumbing or kitchen facilities. In Tacoma, approximately 415 housing units (0.5%) are identified as having incomplete plumbing facilities. Most of these are rental units. About twice this rate, 950 housing units (1.1%) are reported as lacking complete kitchen facilities.¹

Tacoma’s Home Rehabilitation Program addresses a wider range of home repair issues, such as: roof replacement, exterior/interior painting, window replacement, carpet and flooring replacement, heating and air system replacement, electrical work, sewer repair or installation, termite and pest repair, repairing or replacing concrete (such as sidewalks, driveways, or ADA ramps), door and window screen replacement, or foundation/structural repairs. From 2019 – 2024, 66 major ($15-60k) renovations and 204 minor (<$15k) renovations were completed through this program. Homeowners are provided low interest loans to cover the cost of the needed repairs and households at or below 50% of AMI can repay the funds with no interest.²

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Units for moderate, low, very low, and extremely low-income households

The Department of Housing and Urban Development (HUD) establishes thresholds for income groups at the household level. These brackets are relative to the area’s median income and establish eligibility for income-restricted affordable housing units. The categories used for their data reporting are:

• Moderate Income: Between 80 – 100% of the area median income
• Low Income: Between 50 – 80% of the area median income
• Very Low-Income: Between 30 – 50% of the area median income
• Extremely Low-Income: Less than 30% of the area median income

AMI = Area Median Income. Different programs scale their “area median” based on different geographies. HUD uses a specific “HUD Area Median Family Income” (HAMFI) to set their income ranges, scaled with household size. In Tacoma for 2024, for example:

100% AMI is $112,300 (family of 4)

80% AMI is $92,650

50% AMI is $57,900

30% AMI is $34,750

HUD Income Limits 2024

Household Income Brackets

Tacoma households skew lower income when compared to the region – 59% are at or below the area median income. Using the income groups described above, 12% of Tacoma households are moderate income, 21% are low-income, 12% are very low-income, and 15% are extremely low-income. See Exhibit 10. These designations are based around the HUD-defined area median income (HAMFI), which is calculated at a regional scale. A table summarizing the incomes assigned to each category for the most recent year available, 2024, can be found in When determining eligibility for income-restricted affordable housing units, household size is taken into consideration.

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Exhibit 10: Households by Income Bracket, Tacoma, 2020.

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Source: CHAS (Comprehensive Housing Affordability Strategy) dataset based on American Community Survey 5-year estimates 2016-2020; Seva Workshop, 2024. Error! Not a valid link.Sources: Washington State Housing Finance Commission, 2023; Seva Workshop, 2024.

The table in Exhibit 11 describes housing types in Tacoma that are most likely to fall within the affordability range of each group, based on the incomes described above. An analysis of the existing housing stock then counts the units in Tacoma that could be a fit for households in each category without incurring housing cost burden.

Exhibit 11: Matching Housing Types with Income Brackets

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120% HAMFI | All products | 40,813 | | | | 8,052 affordable rental units; | | | | 32,761 ownership units; |

Notes: Middle housing ownership units calculated as ownership units in 1-unit attached housing through structures less than 20 units; Split between 80 – 100% HAMFI and 100-120% HAMFI. Multifamily ownership in buildings 20-49 units added to 100-120% HAMFI and ownership units in 50+ buildings added to >120% HAMFI. Affordable rental units for >100% HAMFI split between 100-120% and >120% HAMFI 20/80. Single family homes split between these two groups at a 30/70 rate to reflect older housing stock of Tacoma homes. Sources: HUD CHAS Table 18C, 2016-2020 for counts of affordable rental units; ACS B25032 5-year estimates, 2017-2021 for ownership units and mobile homes; Seva Workshop, 2024.

Emergency housing, emergency shelters, and permanent supportive housing

In 2017, the City of Tacoma declared homelessness a public health emergency. The count of people experiencing homelessness in the region has continued to rise since then – an estimated 40% increase from 2017-2022 in Pierce County. The count of people experiencing homelessness in Pierce County in 2022 was 1,851.¹ The existing supply of emergency housing, emergency shelters and permanent supportive housing in Tacoma is estimated at 1,362 in 2022.² This includes 1,225 shelter beds and 137 units of permanent supportive housing. The City hopes to transition many of its shelter beds into longer-term forms of housing support such as permanent supportive housing and affordable housing units.

Exhibit 12: Homelessness Counts in Pierce County, 2017-2022.

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Note: The PIT count for 2021 was not conducted, due to the COVID-19 pandemic. Sources: Washington Department of Commerce PIT Counts, 2017-2022; Seva Workshop, 2024.

1.2 Affordability

Housing costs in Tacoma have risen dramatically in the past decade, leading to affordability challenges across almost all segments of the market. In recent years, homeownership affordability has become increasingly strained, being reserved for an increasingly exclusive segment of Tacoma’s society.

Ownership Housing

Homeownership is becoming increasingly out of reach for moderate income households in Tacoma. The average home price in Tacoma in 2023 was $460,000, a 58% increase from 5-years prior (2018). See Exhibit 13. Over the same timeframe, mortgage lending rates increased by 50%, from an average of 4.5% to 6.8%.¹ This combination of factors dramatically increases the cost to purchase a new home, particularly for a first-time homebuyer. Using estimates for average home prices, typical 30-year mortgage lending rates, and expected costs such as property taxes and homeowners insurance, the mortgage on an average home in 2023 is affordable to households at 126% AMI – just out of reach for households in the moderate income band. Using a consistent set of assumptions, in 2018 the mortgage for an average priced home was affordable to households at 103% AMI.

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Exhibit 13: Tacoma Average Home Prices, Annual Change (%), 2015-2023.

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Sources: Zillow Home Value Index, 2024; Seva Workshop, 2024.

Rental Housing

Average rent in Tacoma is affordable for households at 60% AMI. The average rent in Tacoma is $1,676 per month, an increase of 78% since 2015. See Exhibit 14. This analysis, however, does not account for the size of the rental unit which may not align with the household size. Rents vary widely depending on unit condition, size, and location. For example, in a “high market area” for Tacoma, rents are estimated anywhere from $1,500 to $2,890 a month depending on unit type. This range spans affordability for households at 60% AMI to 100% AMI.¹

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Exhibit 14: Average Rents in Tacoma, 2015-2023.

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Sources: Zillow Observed Rent Index, 2024; Seva Workshop, 2024.

Household Incomes

Tacoma’s overall median household income in 2021 was $69,956, a 42% increase from the overall median household income in 2011, which was $49,232. There are wide disparities for median household income when comparing by race and ethnicity, as shown in Exhibit 15. White households have a higher median household income at $77,531. Black and AIAN households have the lowest incomes with medians at $50,603 and $51,234, respectively. All other BIPOC groups also have median household incomes below the citywide median. This median household income falls well below the Pierce County median income in 2021, estimated at $82,574 or the HUD-area median income at $91,100.

In Tacoma, incomes are higher in areas around the North End, West End, and Northeast Tacoma. Incomes are lowest in South Tacoma, the South End, and the Eastside. These geographic trends are visualized in the map in Exhibit 16.

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Exhibit 15: Median Household Income by Race & Ethnicity, 2021.

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↑ Median Income: $69,956

Note: Exhibits per group are compared to the overall median income. Source: American Community Survey 5-year estimates (2017-2021); Seva Workshop, 2023.

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Exhibit 16: Median Household Income by Census Tract in Tacoma, 2021

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Source: American Community Survey 5-year estimates (2017-2021).

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Affordability

Housing affordability is an increasing challenge in Tacoma, particularly for ownership housing. As shown in Exhibit 17, the cost of ownership housing has increased at more than double the rate of median area incomes since 2015, 135% and 59% respectively. Rents increased 78%. These disparities shown a decline in affordability for both rental and ownership housing in Tacoma, but most dramatically for ownership units. Rates of increase for ownership housing spiked, in particular, from 2019-2022. A slight cooldown was observed from 2022-2023.

First-time homebuyers are particularly hard-hit by the combined factors of increasing housing costs and mortgage lending rates. The average fixed-rate 30-year mortgage lending rate in the US was at a low of 2.96% in 2021 but jumped to 5.34% in 2022 and 6.81% in 2023. Higher interest rates have a big impact on monthly housing costs, particularly for first time homebuyers who cannot leverage established equity from previous purchases for a higher down payment amount. In 2022, 56% of Tacoma mortgages were given to first-time homebuyers. The demographics of these homebuyers demonstrate a skew toward White and Asian households and a proportionate underrepresentation of Black and Pacific Islander buyers. See Exhibit 18.

Exhibit 17: Housing Cost and Income Increases as a % Change from 2015 in Tacoma, Average Annual Mortgage Lending Rates 2015-2023.

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Sources: Zillow Home Value Index and Observed Rent Index, Downloaded April 2024; WSHFC Area Median Income, 2015-2023; St Louis FED Mortgage Interest Rates, 2023; Seva Workshop, 2024.

Exhibit 18: First-time Homebuyers in Tacoma by Race & Ethnicity, 2022.

Sources: Federal Housing Finance Agency, Public Use Database (PUDB) - Fannie Mae and Freddie Mac, 2022 Single-Family Census Tract File; Seva Workshop, 2024.

Cost Burden

Households that pay 30% or more of their income toward housing are considered cost-burdened. These households may struggle to cover other essential household expenses, such as transportation or healthcare. Households that pay 50% or more of their income towards housing are considered extremely cost-burdened.

Renters in Tacoma are much more likely than homeowners to experience housing cost burden. Forty-eight percent (48%) of renters experienced housing cost burden in 2020, along with 27% of homeowners. See Exhibit 19. When disaggregated by race/ethnicity, the highest rates of renter cost burden are observed among “Other” households (56%), Black households (54%), Pacific Islander households (51%), and Hispanic households (49%). These rates are shown in Exhibit 20.

Cost burden rates are particularly high (over 65%) in areas across the city, but are most concentrated in Central, South Tacoma, and the South End. The map in Exhibit 21 explores the geographic distribution of these trends. The detailed table in Exhibit 22 further dives into the geographic distribution of renter cost-burden and disaggregates neighborhood rates by race/ethnicity. Demographic groups differ in location of renter cost burden concentration. For example, Black households have the highest rates in North East, South Tacoma, and the West End. Asian households have relatively lower rates of rental cost burden across most of Tacoma, but a concentration of cost-burdened Asian renters live in the North End. Hispanic renters are most cost-burdened in Central, Eastside, and South Tacoma neighborhoods.

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Exhibit 19: Percent of Households Cost Burdened by Tenure, 2020.

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■ Severely Cost-Burdened ■ Cost Burdened ■ Not Cost-Burdened ▨ Cost Burden data not availabe

Note: Cost-Burdened households spend between 30-50% of income toward housing. Severely cost-burdened households spend more than 50% of gross income for housing. Sources: CHAS (Comprehensive Housing Affordability Strategy) dataset based on American Community Survey 5-year estimates 2016-2020; Seva Workshop, 2024.

Exhibit 20: Renter Households Cost Burdened in Tacoma (%), by Race & Ethnicity, 2020.

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■ Severely Cost-Burdened ■ Cost-Burdened ■ Not cost burdened ▨ Cost Burden data not available

Note: Cost-Burdened households spend between 30-50% of income toward housing. Severely cost-burdened households spend more than 50% of gross income for housing. Sources: CHAS (Comprehensive Housing Affordability Strategy) dataset based on American Community Survey 5-year estimates 2016-2020; Seva Workshop, 2024.

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Exhibit 21: Distribution of Renter Cost Burdened-Households in Tacoma, as a % of Block Group Population, 2020

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Source: CHAS (Comprehensive Housing Affordability Strategy) dataset based on American Community Survey 5-year estimates 2016-2020.

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Exhibit 22: Renter Cost Burden by Race/Ethnicity and Neighborhood in Tacoma, 2020.

55 - 65% Cost Burden Rate Over 65% Cost Burden Rate

AIAN = American Indian and Alaska Native. Note: Green highlighting indicates a rate >55% and blue highlighting indicates a rate >65%. Margins of error will be higher for groups with smaller sample sizes. Sources: CHAS (Comprehensive Housing Affordability Strategy) dataset based on American Community Survey 5-year estimates 2016-2020; Seva Workshop, 2024.

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2 PROJECTED HOUSING NEED

2.1 Growth targets

Tacoma’s growth target for 2017-2050 is to add 137,000 people or 59,052 housing units. So far, 4,588 units have been added to the City’s housing stock (2017-2023) which leaves a remaining 54,464 unit gap. The annual growth rate needed to achieve the 2017-2050 target is 1.5%. The achieved annual growth rate for the 2017-2023 period is 0.8%. The pace of production will need to increase in future years to align with this vision for growth in Tacoma. The graph in Exhibit 23 also identifies the 2044 housing target, as defined by Pierce County. This target (2020-2044) sets the standard for evaluating adequate capacity by income bracket in Tacoma, per guidance provided by state and regional agencies.

Exhibit 23: Tacoma Housing Units, Actual and Target 2015-2050.

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As of 2023, there is a gap of 54,464 housing units to fill by 2050 to achieve regional growth targets in Tacoma.

Sources: OFM Housing Units, 2015-2023; PSRC Housing Target for 2017-2050; Seva Workshop, 2024.

Distribution of targets across income brackets

Tacoma strives to meet its growth targets equitably, which means that new housing units should accommodate households across the income spectrum. The Department of Commerce has outlined a methodology for projecting housing need by income bands that takes into account a full spectrum of needs at the countywide scale. Pierce County has taken this methodology and assigned targets to each of its jurisdictions, both totals and allocations by income bracket. See Exhibit 24.

Exhibit 24: Housing Units Needed by Income Bracket in Tacoma, 2020-2044.

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The production of 42,865 units is needed in Tacoma by 2044. 30% of this is at the lowest affordability level, 34% for low- and very low-income households, and the remainder for moderate- and higher-income households. The distribution is based on Pierce County allocations and takes into account current housing needs to eliminate cost burden and homelessness, as well as the needs of future households. These production targets envision a future with no housing cost burden and no chronic homelessness in Tacoma.

Sources: Pierce County Countywide Planning Policies Appendix A, 2022; Seva Workshop, 2024.

Emergency Housing Needs

Communities also need to plan for emergency housing and emergency shelters. In implementation, the lines between these two types of accommodation can be blurred and thus for planning purposes they are calculated together as a single category. Housing types in this category must be indoors and allow access to personal hygiene facilities. It includes emergency shelters, hotel rooms, tiny home villages, and short-term apartments.

Existing supply (2020): 1,118

Target for the 2020-2044 planning period: 2,624

3 LAND CAPACITY

3.1 Existing land capacity for housing

Tacoma has capacity for an additional 68,049 housing units across its residential zones, according to Pierce County’s 2022 Buildable Lands study. This exceeds the housing target of an additional 42,865 units by 2044. Additionally, housing policy that is currently following the legislative process will add another 300,000 – 650,000 units of capacity to the City’s residential zones, largely allocated for middle housing types.¹ This chapter details Tacoma’s residential zoning districts and their capacity to meet the city’s housing targets – considering a diverse set of needs to align with a diverse population.

Exhibit 25: Land Use Designations that Allow for Residential Uses, % of Total Acreage.

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Sources: City of Tacoma; 2023; Seva Workshop, 2024.

Tacoma’s current land use framework follows a ‘center and corridors’ model. The largest and densest centers are the Regional Growth Centers located Downtown and at the Tacoma Mall. Mixed-Use Centers are distributed across the city and are often buffered by gradual density step-downs from multifamily zones to lower density residential blankets that cover 41% of the city’s land (65% of land from areas that allow for residential uses). Tacoma currently allows residential uses in 9 of its 15 broader land use designations. Zones that do not allow for residential use are the industrial districts, parks, institutional campuses, airport areas, and

shorelines. The chart in Exhibit 25 shows the share of land allocated across these broader land use designations that allow for residential uses, and the map in Exhibit 26 identifies Tacoma’s land use designations geographically.

Exhibit 26: City of Tacoma Land Use Designation Map, 2023.

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Source: City of Tacoma, 2023.

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Zoning

The broader land use designations represent a wider range of detailed zoning districts. These districts are mapped at the neighborhood level in this section, on pages 29 through 36.

Exhibit 27: West End Zoning Districts

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Note: The City of Tacoma adopted a zoning update related to housing policy after the completion of this baseline conditions report (Home in Tacoma). These updates are note reflected in this section but impact the lowest density residential zones.

Much of the West End neighborhood is covered by lower density residential zones, R1 and R2. Pearl Street is the prominent north/south hub for mixed use and higher density zoning districts, such as CCX, R4, and C2. The east/west corridors on 6th Ave and S 12th Street are also denser activity areas.

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 28: North End Zoning Districts

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The North End neighborhood is characterized by R2 residential zoning. The southeastern pocket of this neighborhood is designated as a Historic Mixed-Use residential district. There is a small corridor of NCX and C2 zoning along the southern border (6th Ave).

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Exhibit 29: Central Zoning Districts

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Central Tacoma includes a wide range of zoning districts, including areas of low-, mid-, and higher- density.

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 30: New Tacoma Zoning Districts

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New Tacoma includes Downtown and the industrial district of the Tideflats. Downtown zones allow for the highest density of residential uses in the city.

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 31: North East Zoning Districts

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The North East neighborhood is almost entirely R1 and R2 zoning in the areas outside of industrial use. There are a few small nodes of commercial activity where a greater mix and density of uses are allowed.

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 32: South Tacoma Zoning Districts

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The South Tacoma neighborhood features a wide range of densities and use types. There are industrial lands running along a central spine, but a mix of commercial and residential areas to either side.

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 33: South End Zoning Districts

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The Sound End of Tacoma is blanketed mostly by R2 zoning. There are commercial corridors running north/south along Pacific Avenue and Tacoma Mall Blvd. A pocket of mixed use districts exists in the north of the subarea.

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 34: Eastside Zoning Districts

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Tacoma’s Eastside has a range of zoning districts. Most of the central area in the neighborhood is designated as R2. The northern portions of the neighborhood include a range of commercial and mixed use areas. The eastern edge features higher density and mixed use districts along Portland Avenue.

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Capacity Analysis

The Pierce County 2021 Buildable Lands Study identifies capacity for an additional 68,049 housing units in Tacoma under existing zoning regulations. The table in Exhibit 35 breaks out this capacity by zone. Half of Tacoma’s residential capacity is concentrated in 4 zoning districts: Downtown Residential/DR (15%), Urban Residential Mixed-Use/URX (14%), Residential Commercial Mixed-use/RCX (11%), and Downtown Mixed-Use/DMU (10%). Another 40% of residential capacity is found across 6 districts: Single Family/R2 (9%), Warehouse Residential/WR (8%), Neighborhood Commercial Mixed-Use/NCX (8%), Community Commercial Mixed-Use/CCX (6%), Downtown Commercial Core/DCC (5%), and Urban Center Mixed-Use/UCX (5%). The remaining 10% of capacity is spread across 15 districts that each have 2% or less of total capacity. A map of this capacity can be found in Exhibit 36.

Exhibit 35: Tacoma Residential Land Capacity, by Zone, 2022.

Source: Pierce County Buildable Lands, 2022; Seva Workshop, 2024.

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 36: Tacoma Housing Capacity, 2022.

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Sources: Pierce County Buildable Lands, 2022; Seva Workshop, 2024.

Zoning Categories

Tacoma’s housing capacity is sufficient for the total number of target housing units, but further analysis is needed to understand if this capacity maps to the full income spectrum. To understand if this capacity will meet the needs of all Tacomans and foster an equitable future for housing, Tacoma’s zoning districts with available housing capacity are grouped into broader

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categories below by allowed/typical housing types produced. Achieved density level calculations are also included, to better understand existing conditions by zone.

Exhibit 37: Tacoma Zoning Districts Categorized by Typical and Allowed Housing Types

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Sources: Typical and allowed housing types from the Tacoma Zoning Reference Guide, 2016; Achieved densities from Pierce County Buildable Lands pg. 244, 2022; Seva Workshop, 2025.

The table below correlates these defined zone categories with incomes likely to be served by the available housing products allowed and typical within them.

Exhibit 38: Income Bands Associated with Zoning Categories

Sources: Zone category definitions based on Commerce Housing Element Update guidance pg. 32, 2023; Income association with housing types based on affordability analysis in this report as well as HIT Feasibility Memo.

Capacity by income band

Combining the capacity calculations summarized in Exhibit 35 and the zoning category to income band correlations outlined in Exhibit 38, residential capacity in Tacoma can be evaluated across the income spectrum. This analysis is shown below in Exhibit 39. As highlighted on previous pages, this capacity analysis is based on calculations prior to the adoption of new zoning regulations in Tacoma, related to the Home in Tacoma update.

These new zoning regulations dramatically expand the existing capacity in Tacoma’s lowest density zoning districts, estimated to increase net new housing units by 25,000-50,000 in lower density zones. 12 This offers additional assurance that Tacoma more than exceeds the targets allocated to each income band into the future.

Exhibit 39: Tacoma Residential Land Capacity by Income Band, 2020-2044 Targets

Sources: Projected need based on Pierce County CPP Appendix A, 2022; Capacity by zone based on Pierce County Buildable Lands, 2022; Seva Workshop, 2025.

Capacity for emergency housing

Capacity data from Pierce County Buildable Lands (2022) was used for this analysis.

1. To start, the project team identified zones where emergency shelters are allowed outright: UCS, CCX, CIX, C2, M1, DCC, DMU, DR, and WR. 13 All parcels identified as vacant from these designations were pulled.

2. Vacant parcel acreage was reduced by identification of critical areas and removal of parcels from the list with development permits that occurred in years since the buildable lands analysis.

3. Each property remaining on the list was evaluated for the potential number of emergency housing beds it could accommodate. This was performed by applying example densities, as identified in Commerce Guidance. Half of the parcels used the standard of emergency housing from, at 71 units/acre and half of the parcels used the standard of tiny home village housing at 14 units per acre. 14 These were selected as comparable estimates from peer communities, reflecting a moderate density level for any given site.

4. Per Tacoma’s Title 2 Building Code for emergency shelters, no individual site was allowed to exceed 99 beds. Any site with an estimate beyond 99 was reduced to this maximum capacity limit.¹

Exhibit 40: Emergency Housing Land Capacity Analysis

Sources: Pierce County Buildable Lands, 2022; Seva Workshop, 2025.

5. This analysis resulted in a capacity for 3,184 emergency housing beds. This exceeds the 2044 capacity target of 2,624 beds.

   a. Not considered in this analysis were underutilized parcels and hotels/motels in the selected zones, which would further expand the estimate for emergency housing capacity. b. Not considered in this analysis are higher density congregate emergency shelter types, which could be part of Tacoma’s future response to addressing emergency housing needs and would yield more capacity on the included parcels. c. This analysis only considers zones where emergency housing is permitted outright. In an additional 12 zones emergency housing is permitted as a conditional use, which further increases the total capacity for this type: R4, R5, PRD, URX, RCX, NCX, T, C1, HM, HMX, and PDB zones. d. In addition to this analysis, Tacoma’s Ordinance 28460 allows an exemption for religious and non-profit sites to host emergency shelters on a temporary basis, which further expands the city’s capacity to accommodate emergency housing needs.

Capacity for special housing types

• Housing for moderate income households in Tacoma includes ownership opportunities for middle housing types and rental opportunities for most types of rental units.¹
• Housing for low-income households in Tacoma includes much of the rental housing stock but few homeownership opportunities without public subsidy or nonprofit support. There are some units of income-restricted affordable housing set aside for these renters.
• Housing for very-low income households in Tacoma includes income-restricted affordable housing and some market-rate rental units in older buildings.
• Housing for extremely low-income households in Tacoma includes transitional housing, permanent supportive housing, and income-restricted affordable housing.

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Middle housing types, such as townhomes, 2-3-4-plexes, and cottage housing are allowed across most all residential districts in Tacoma. The R1 zone is the most restrictive for these types. The table in Exhibit 41 summarizes middle housing types permissions across residential zones. For each type, the minimum lot size varies and is larger in lower density zones. Capacity analysis shows the most space for additional housing units in the R-2 zone (6,089 units).

Exhibit 41: Middle Housing Types across Residential Zones (permit type - minimum lot area in SF)

CU = Conditional Use permit required Sources: TMC 13.06.020(F); Seva Workshop, 2024.

Manufactured housing, described in the zoning code as mobile homes and trailer courts, are allowed as a conditional use in the R-4-L and C-2 zones. The R-4-L zone,is described as “low density multifamily” and can be found in small areas south of Downtown and the Tideflats, as well as scattered sites across Tacoma’s neighborhood districts. See map on the next page, Exhibit 43, which identifies these areas. There are approximately 356 units of manufactured housing in Tacoma today.¹ Capacity for additional units in the R-4-L zone is 844 and in the C2 zone is 584. Mobile home communities are increasingly rare within city limits, due to financial pressures that lead to redevelopment.

Multifamily housing is allowed in many residential districts. Mid-scale residential (R3) allows multifamily as a conditional use on lots at least 9,000 square feet in size. In all residential and commercial zones above this, multifamily housing is permitted outright.

Permanent supportive housing and income-restricted affordable housing is allowed anywhere that multifamily housing units are permitted. Exceptions exist if units are classified as group housing or emergency housing – explored below.

Group housing and foster care facilities are allowed uses across almost all residential, commercial, and mixed-use zones, although lower density residential zones limit the quantity of residents in group housing facilities. In mixed use zones such as NCX or CCX these uses are not allowed at the street level along frontage of pedestrian streets.

Emergency and transitional housing is allowed as a conditional use in many Tacoma zones such as R-4-L, R-4, and R-5. They are allowed uses in Urban Center, Commercial Mixed-Use, Downtown Commercial Core, and other higher density zones. The table in Exhibit 42 summarizes where these housing types are currently allowed in Tacoma.

Exhibit 42: Special Needs Housing Types as Permitted Uses in Tacoma

N = Not permitted; CU = Conditional Use; P = Permitted Source: TMC 13.06.080.N

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 43: City of Tacoma Areas Zoned as R-4-L.

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Sources: City of Tacoma, 2024; Seva Workshop, 2024.

3.2 Home in Tacoma

Home in Tacoma (HIT) is a project with phase I adopted in December 2021 enacting changes to the city’s housing growth strategy by supporting middle housing types citywide and taking action to ensure that housing growth can meet multiple community goals. In 2023, the City conducted intensive engagement as part of the project’s second phase. In the meantime statewide

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legislation such as HB 1110 (middle housing), HB 1337 (ADU support), and SB 5412 (SEPA Exemptions) was passed. Tacoma adjusted its package of policy reforms to align with these legislative directives. The public comment period for HIT ended in March 2024. The changes for this package of reforms include¹:

Middle Housing Zoning Framework

Single family zoning will be replaced with Urban Residential (UR) zoning that allows for a range of building sizes that include multiple units, also known as middle housing. New housing types and permitting frameworks will be developed to support this shift.

Housing Types

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Middle Housing Standards

New form-based building design standards will correspond with these zoning changes. Revised site development standards will follow suit to update buildings’ height, scale, parking and landscape requirements. Housing types will be: houseplex, backyard building, courtyard housing, rowhouses, and multiplex.

Affordable Housing Regulatory Tools

These policies are designed to increase housing supply, choice, affordability, and ownership opportunities in Tacoma. They expand the City’s inclusionary housing program to target unmet needs and align with market conditions. The structure of the City’s bonus program is revisited to be more user friendly, reduce administrative burden, and to set parameters for income targets. MFTE is recommended for the new UR-3 zone.

4 PROGRAMS AND POLICIES

4.1 Identifying barriers to affordability and availability of housing

Housing Production Trends Compared to Need

This section reviews housing production trends for the types needed to meet housing targets across all income bands in Tacoma.

Exhibit 44: Housing Production Trends by Income Level, 2011-2021, Compared To Needed Production Levels for Targets 2020-2044.

Sources: Projected housing need from Pierce County CPPs, Appendix A; Average annual unit production from ACS 5-year estimates, 2011 and 2021 (note that this source documents the net change in this unit type, taking into account both demolition and construction); Seva Workshop, 2025

Identifying Barriers

Per the analysis shown in Exhibit 44, low-rise and mid-rise multifamily housing styles are identified for low production rates relative to desired production to meet targets. While there may be some small additional regulatory or process improvements to propose for these housing types, the leading barrier understood in this case is financial feasibility. The HIT Feasibility Analysis (2024) tests the market feasibility for many middle housing types addressed in the

proposed code amendments associated with the program. This analysis finds that, even with all the proposed code updates and process improvements in HIT, low-rise and mid-rise multifamily products are only financially feasible in “high market areas” which are much less likely to serve the intended income brackets of 80% AMI or less. Further, while some low-rise and mid-rise development formats are financially feasible in these high market areas, they remain less profitable than alternatives, such as townhomes or duplexes. Another key finding from this report is that ownership housing is more likely to be built than rental housing for these middle housing types, making it even less likely that small- to mid-rise rental buildings will be part of new housing stock in Tacoma.

Addressing the financial feasibility barrier for low-rise and mid-rise multifamily housing types raises similar concerns to meeting targets for PSH and income-subsidized affordable housing for those in Tacoma’s lowest income brackets. Adequate provisions for income-restricted affordable housing in Tacoma has been studied extensively through the City’s recent Affordable Housing Action Strategy work. Financial assistance, whether in the form of direct funding, incentive programs, or rental vouchers, falls far short of the amount needed to meet housing needs. This is true across Pierce County, as explored in the “Pierce County Housing Action Strategy” (2022) and summarized in Exhibit 45.¹ This analysis estimates an annual funding gap of $624 million dollars countywide for households at 50% AMI or less, even if potential new funding strategies outlined in the study are implemented. Coordinated action countywide is described as critical to meet these needs, including new funding streams and land donation efforts. Tacoma is exploring many options to increase its supply of affordable housing, however, and these strategies are reviewed in the next section of this report.

Exhibit 45: Funding Gap for Affordable Housing, Pierce County, 2022.

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Image Source: “Pierce County Housing Action Strategy”, 2022, BERK Consulting.

4.2 Addressing barriers, gaps, and needs

The City of Tacoma has been very active in recent years to address its housing challenges. In February 2024, the City adopted its Anti-Displacement Strategy which adds 21 policy and program options for the City to take that address a lack of affordable housing and displacement pressures in the City. The list below captures these initiatives designed promote greater affordability and equity in the city’s housing market:

Income-Restricted Affordable Housing Policies and Investments

• Affordability incentives such as height and density bonuses, tax reduction, and permitting support are examples of supports that Tacoma has implemented to promote the inclusion of affordable units within market rate housing developments.¹
• Inclusionary zoning. This policy framework takes the above incentives and makes them mandatory in areas of the city where the market supports denser development. Tacoma currently has inclusionary zoning in place in the Tacoma Mall Regional Center (2018).²
• Land banking is the process of purchasing land or buildings in areas of the city that can be used for the development of affordable housing. The Tacoma Community Redevelopment Authority (TCRA) Board is the City’s mechanism for land banking.³

Supporting Homeownership and Wealth Building

• Down-payment homebuyer assistance includes homebuyer education as well as assistance for down payment funds for first-time homeowners. Tacoma’s program began in 2023.
• Accessory Dwelling Units (ADUs) are allowed in Tacoma and new policies promote increased development of this housing type, which helps build equity for homeowners and offers housing stock that meets a variety of community needs. Tacoma’s ADU program was revamped in 2019 and new supports help homeowners with the financing needed for increased production.
• Home Maintenance Support helps low-income homeowners pay for necessary repairs that make their housing suitable for long-term living.

Tenant Protections

• Tacoma’s rental inspection program assesses quality of conditions for renters, holding landlords accountable to health and safety standards. This program mitigates

displacement that could be caused by violation of these standards by identifying pathways to remediation for property owners. In today's version of this program, the tenant must request the inspection.¹

• Rental Housing Code. In 2018, Tacoma adopted the Rental Housing Code, which provides protections for tenants in the city. It includes requirements for notice prior to termination of tenancy or rent increases, or notice and relocation assistance when the building will change use or redevelop.² Landlords are penalized if they are out of compliance with these regulations.
• Tenant Relocation Funds. This program provides $2,000 in relocation assistance to eligible tenants to assist with moving costs when displacement occurs due to demolition, rehabilitation, or a change in use.

Direct Assistance to Address Housing Insecurity

• Utility assistance provided by Tacoma Public Utilities and Environmental Services offers reduced utility costs to eligible households.

Policies and Programs Under Consideration

• Home in Tacoma (HIT). As described on page 45, this package of reforms widely expands access to middle housing types across Tacoma. These housing types offer homeownership at rates that are affordable to a broader range of income bands.³
• Right of First Refusal is being explored as a policy option to pair with Tacoma's Preservation Ordinance. This would give affordable housing developers the first chance at purchasing certain properties, at market rate, before the building is offered to other potential buyers.
• Tenant Opportunity to Purchase Act (TOPA). This program help tenants organize to purchase a building collectively rather than have the property sold to another investor. This action builds equity for renters in areas experiencing displacement and share in any gains to land values built in their communities.
• A Housing Preservation Fund would create a dedicated stream of funds for the acquisition of properties, or the provision of low-interest financing, to support preservation efforts.
• Community land trust (CLT) support. The City could allocate funds to offset startup or operating costs associated with CLTs in Tacoma.

• A Community Prioritization Policy would give preference to households who have been displaced, who descend from displacement, or who are actively at high risk of displacement when reviewing applications for income-restricted affordable housing.

5 ACCESS TO EMPLOYMENT

According to 2021 LEHD Origin Destination Employment Statistics (LODES), 28% of working Tacoma residents both live and work Tacoma. A combined 22% percent have places of employment in surrounding cities of Lakewood, Kent, Auburn, Federal Way, and Fife. Twelve (12%) of Tacoma workers have their place of employment in Seattle. About one-third work elsewhere – this includes at Joint Base Lewis-McChord, one of the largest Tacoma resident employers. See Exhibit 46. It is important to note the LEHD data is based on administrative records such as unemployment insurance reporting connecting place of residence and place of employment. These numbers reflect both commuters and those who are working remotely. They also do not include self-employed workers who are more likely to work from home.

The American Community Survey is based on self-reported respondent experiences and will be inclusive of self-employed workers. Based on the 2021 ACS data, the Tacoma workforce largely commutes by car, 70% driving alone and another 10% carpooling. The mean travel time to work is 30.4 minutes with 22.7% of workers commuting 45 minutes or more to work. Ten percent of the workforce works from home and only 6% of workers use public transportation. See Exhibit 47.

The likelihood of Tacoma workers taking a certain means of transportation to work varies by race and ethnicity. Exhibit 48 compares the distribution of commute methods to the underlying distribution of workers by race and ethnicity. Communities of color are more likely than average to carpool. Black workers are much more likely than average to commute to work by public transportation. White, non-Hispanic or Latino, workers are the most likely group to commute alone by car, truck, or van.

Tacoma’s biggest job center is Downtown, followed by the Tacoma Mall, Tideflats, and South Tacoma MIC areas. Strengthening public transportation options from residential centers to these employment hubs could improve the public transportation capture rate from the city’s commuters. Given the higher ratio of Black workers using public transportation, continued improvement of bus service can help meet racial equity goals. Very few Tacomans report walking to work (2%). This indicates that there is not a complementary clustering of work opportunities and housing centers within the city.

Exhibit 46: Tacoma Inflow/Outflow Analysis, 2021.

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Sources: Census OntheMap, 2021; Seva Workshop, 2024.

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 47: Means of Transportation to Work, 2021.

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Source: American Community Survey 5-year estimates (2017-2021)

Exhibit 48: Means of Transportation to Work by Race and Ethnicity, 2021.

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Note: A value of 0 indicates the share of that group using that means of transportation is equal to their share in the overall population. AIAN=American Indian and Alaska Native; NHOPI=Native Hawaiian and Other Pacific Islander. Hispanic or Latine is an ethnicity. The Hispanic or Latine category includes Hispanic and Latine people of all races. All other categories show non-Hispanic races. Source: American Community Survey 5-year estimates (2017-2021) (B08119, B08105B-I)

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6 RACIAL EQUITY IN HOUSING POLICY

6.1 Racially disparate impacts

In Tacoma, racial disparities are observed in homeownership rates (see Exhibit 7), household incomes (see Exhibit 15), and rates of housing cost burden (Exhibit 20). Non-white households have lower rates of homeownership and lower household incomes, and Black households experience the greatest disparities across these datapoints. Geographically speaking, Tacoma’s communities of color are more densely populated in south and east Tacoma neighborhoods, as shown in the map in Exhibit 49. Location decisions are a function of many factors at the household level, including available resources and access to desired amenities. Today’s distribution of racial groups is also influenced by historical policies and practices, such as treaties, redlining, Japanese incarceration, and Chinese expulsion¹.

During active redlining in Tacoma, the North End and areas extending to the bay were identified as the most desirable parts of the city. Downtown, the Hilltop area, the northern parts of Eastside, and parts of South Tacoma were labeled as “hazardous” (pink) or “undesirable” (yellow) due to the presence of non-white residents. These practices concentrated communities of color in neighborhoods that were de-prioritized for public investment and services. Areas identified as “first” (green) or “second” (blue) grade were more favorable and predominantly White homeowners. These same areas remain whiter than other Tacoma neighborhoods today. See Exhibit 50 for the 1937 map used by mortgage lenders.

Today, the decline in homeownership affordability for moderate and low-income households perpetuates these inequities. Rising interest rates and house prices raise the barrier to entry for home ownership. In Tacoma, racial disparity persists among first-time homebuyers, particularly for Black and NHOPI households. See Exhibit 18. Policy proposals included with Home in Tacoma address this decline in affordability by expanding opportunities for middle housing types. The proposed zoning changes and incentive programs would take steps to address this disparity.

Exhibit 49: People of Color as a Proportion of the Population in Tacoma, 2021.

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Source: American Community Survey 5-year estimates (2017-2021).

Exhibit 50: Tacoma “Residential Security Map”, 1937.

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Image Source: “Mapping Inequality” website, hosted by the University of Richmond.

In 2021, the City of Tacoma conducted an in-depth study into its systemic race-based disparities in housing. This report studied both quantitative and qualitative sources related to housing, discrimination, and homeownership opportunity in Tacoma. Key findings from this study include:

• Black households have experienced a stark decline in homeownership from 1990-2020 in Tacoma. All other racial groups experienced increase or stable rates of homeownership over this time period. Black and Hispanic households across the country are shown to have been more significantly impacted by the predatory and subprime lending practices that led to the 2008 foreclosure crisis. See Exhibit 51.

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 51: Percent Change of Owner and Renter Households by Race, in the City of Tacoma 1990-2020.

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Tenure — Owner -- Renter

Notes: AAPI is Asian American and Pacific Islanders, AIAN is American Indian and Alaska Native, Other refers to people not fitting into a provided group. The multiracial category was not introduced until 2000 and thus not included. Sources: Sources: U.S. Census, American Community Survey (ACS), 2015- 2019 (5 Year Survey) and NHGIS (National Historical GIS) iPUMs data; EcoNorthwest “Tacoma Housing Disparities”, 2021.

• Tacoma’s educational attainment levels are significantly lower than statewide rates across almost every race category. In Tacoma, 19% of Black residents have a bachelor’s degree or higher compared to a rate of 33% for White residents. Lower levels of educational attainment impact expected income generation potential, which connects directly to a household’s ability to avoid cost burden.
• Racial disparities for household income are observed in Tacoma, connecting to trends in homeownership and educational attainment. Black households have the lowest median income.

6.2 Displacement

In 2024, the City of Tacoma adopted an Anti-Displacement Strategy that outlines policies and programs that address housing stability for vulnerable residents. These strategies address three types of displacement: physical displacement, occurring when building conditions change like in case of natural disaster, condemnation, or eminent domain; economic displacement, when housing cost increases are dramatic enough that a resident must move or is evicted; and cultural displacement, when a household moves because the businesses/services/community that cultivate a sense of belonging for them are no longer present.

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The strategy studies displacement risk mapping exercises completed by the Department of Commerce, Puget Sound Regional Council, UC Berkeley Urban Displacement Project, Evictions Study Map, and the City’s own Equity Index.¹ Rather than creating a new displacement risk mapping tool, the City evaluated these 5 different, but related, analyses for a comprehensive study of the various factors impacting displacement risk in Tacoma.

Exhibit 52: Displacement Risk Mapping in Tacoma, Draft 2024.

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Note: This is a Draft version Source: Washington Department of Commerce, 2025.

Under these displacement definitions and considering the findings of these five studies, the strategy identifies particular displacement risk:

• Geographically, in the Hilltop neighborhood and in parts of South and East Tacoma

• Racially, People of Color are shown to be at higher displacement risk than White residents

Additional detailed study into movement of particular households is conducted in the 2021 “Tacoma Housing Disparity Study”. This report observes that between 2000-2019, residential patterns of Black households indicate that the central, west end, and eastside areas of Tacoma show signs of gentrification and displacement risk.

Existing policies and programs that might contribute to displacement in Tacoma are:

• Concentrated and significant upzones contribute to displacement risk. Land becomes more valuable as denser development is allowed on each site, which contributes to financial pressures toward economic displacement. When certain parts of the city remain very low density while others are dramatically upzoned, displacement risk is concentrated in those upzoned areas. In Tacoma, there are many neighborhoods where low density residential zoning is protected, meaning that other areas, such as the Downtown and Mixed-Use Centers, have experienced this increased displacement risk.
• Large public investments in infrastructure and amenities can contribute to displacement risk. These investments, such as new public transit infrastructure, increase the desirability of neighborhoods and can increase land values. Light rail expansion in Tacoma will increase displacement risk near station areas, both from physical displacement via eminent domain and economic displacement form increased property values. Future stations are planned in the Portland Avenue and Tacoma Dome areas, with service starting in 2030.

Existing policies and programs that are aimed at mitigating displacement pressures:

• Concentrations of residential zones with very low density also contribute to a city’s overall displacement risk. Maintaining these areas means that during periods of growth when development pressures rise, there is less land to spread these pressures across. Areas vulnerable to displacement pressure feel a more intense version of those forces. State policies that eliminate exclusive single family zoning (HB 1110) and new legislation proposed through Home in Tacoma would make a big impact on increasing housing options in Tacoma.¹
• Affordable housing incentive programs increase the supply of income-restricted housing units. These units provide assurance that households with lower incomes will have a place in the community, for the long term. When applied in areas with higher concentrations of vulnerable populations, they can have a bigger anti-displacement impact. Examples of these programs in Tacoma today include: Inclusionary zoning, density bonuses, Multifamily Tax Exemption (MFTE), and priority permit review.
• Down-payment homebuyer assistance program. Since 2014, the City has intermittently contracted with Washington State Housing Finance Commission to administer downpayment assistance funds for eligible households with incomes at or below 80%

AMI. This program ended in 2023, but the City is working to implement a new, internally operated program.

6.3 Exclusion

Historic Practices

A history of exclusionary legal practices provides a framework for modern residential patterns. A longer exploration of this history can found in the Equity Assessment Context History and Baseline document for this project. Key takeaways from this review, relevant to residential exclusion, include:

• Intense decrease in Tribal populations after early arrival of White settlers due to diseases such as smallpox and influenza. Displacement of indigenous inhabitants via treaties that cede Tribal lands in areas now known as Tacoma.
• Labor movements and fear-based campaigns against Chinese railroad workers, leading to a ban on citizenship and land ownership for these immigrants in the late 1800s. This included a mob in 1885 that marched through Tacoma’s Chinatown, destroying homes and businesses.
• The internment of Japanese and Japanese-Americans to concentration camps during World War II.
• Redlining and Racially Restrictive covenants, as explored in the Racially Disparate Impacts section, blocked many – particularly Black Americans – from homeownership and settlement in certain designated areas of Tacoma until these practices started being dismantled with the Fair Housing Act of 1968

Modern Lending Practices

Home Mortgage Disclosure Act (HMDA) data show that Black, Hispanic, and other minority applicants are less successful than White applicants in obtaining mortgage financing in Tacoma. The most common denial reasons listed for loan applicants in Tacoma are debt to income ratio (28%) and credit history (23%). Credit history is a more prevalent reason for denial among Black and Indian/Alaska Native applicants, while Hispanic applicants are more likely denied based on debt-to-income ratios.¹ Access to credit is a major factor in determining eligibility for homeownership and building generational wealth.

Location Quotient Analysis

A location quotient is a metric calculated to show the concentration of communities of interest in each census tract relative to patterns across a lager geography. It is a useful

tool for illustrating patterns of segregation and exclusion. For example, if 7% of a neighborhood population is Black, and 7% of that county’s population is Black, then the location quotient is 1. A tract where 14% of residents are Black would have a location quotient of 2. And a track where only 3.5% of residents are Black would have a location quotient of 0.5. So, tracts with high location quotient scores have a greater share of that population compared to the rest of the County.

Tacoma has long been more diverse than Pierce County has a whole. As noted above, the City has historically been home to particularly high concentrations of Asian and Black residents as compared to Pierce County. Asian communities in Tacoma are highly represented in the southern parts of the city, particularly in South Tacoma and Eastside. Black communities have higher representation across many Tacoma neighborhoods, but notably low representation along the waterfront in the North End. Both Black and Asian communities are also highly represented in areas outside of the Tacoma City boundary and in other urban and peri-urban areas of Pierce County. See Exhibit 53.

The durability of redlining effects can be seen in North End that has a higher concentration of White households than compared to Pierce County as a whole and lower concentration of Asian, Black and Hispanic/Latino residents. The location quotient maps suggest that the concentration of White communities is relatively even across Tacoma, with lowest prevalence in southern neighborhoods. Hispanic/Latino communities of Tacoma are most densely represented in Eastside, New Tacoma, and South Tacoma neighborhoods.

ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 53: Location Quotient, Asian, Black, Hispanic Latino, White Alone

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Sources: American Community Survey 5-year estimates (2017-2021); Seva Workshop, 2024.

A location quotient is a metric calculated to show the concentration of communities of interest in each census tract relative to patterns across a lager geography. It is a useful tool for illustrating patterns of segregation and exclusion. In the above maps, the darker orange shade identifies concentrations of the studied group across Tacoma, and the green identifies low prevalence of the group. In the top left, Asian households. Top right, Black households. Bottom left, Hispanic/Latino households, and bottom right-White households. These rates are relative to Pierce County’s overall demographics, hence the overall lower ratios of White households in Tacoma.

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6.4 Policy Audit

In compliance with the HB 1220 framework of updates to comprehensive plans, the One Tacoma Plan process started with an in-depth review of the City’s housing policy history with a racial equity lens. This can be found in the project’s Equity Assessment Context History and Baseline document. The project team then selected a short list of equity outcomes that are cross-cutting across all Comprehensive Plan chapters. Housing-specific indicators reviewed in this assessment include an analysis of first-time buyers of single dwelling structures, renter-occupied housing cost burden greater than 50%, and the percent of residents living in the same house one year ago. All data was disaggregated both by geography and by race/ethnicity to identify patterns of discrimination and exclusion across the city.

Then, a comprehensive review of all policies in the Housing element of the 2015 Comprehensive Plan applied a rating to flag concerns for racial equity considerations. The rubric for this review was designed to be a tool for reviewers to assess Comprehensive Plan policies regardless of prior assessment and equity experience. The goal is not to “score” each policy on each of the Assessment Considerations. Instead, the considerations are guiding questions and lenses for reviewers to think through the policy and its characteristics and implications. After thinking though the considerations, we recommend assigning an overall rating as a synthesis of the results.

In the audit process, multiple reviewers independently review the policies and assign ratings. Comparing the results of these independent audits, policies where different ratings were assigned would warrant further discussion to arrive at a consensus. We note that the goal is not to have a plan full of transformative policies, but to build in key opportunities to advance equity, especially on priority outcomes and for priority groups listed above.

ONE TACOMA Report | June 2025 Housing Baseline Conditions

A lens for language improvements was also applied to this review. A summary of the findings is included below.

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

Exhibit 54: Policy Audit of the 2015 Comprehensive Plan Housing Element

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

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ONE TACOMA Report | June 2025 Housing Baseline Conditions

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