The Problem

In Seattle’s early days, building codes were lax and citizens were allowed to build as many structures as they wanted on their land – including postage-stamp-sized lots. By 1957, the majority of citizens had had enough of that, and the city council passed a law stating that the minimum residential lot size would be 5,000 square feet, and only one house could be built on a lot.

That’s still the law today: One lot, one house, and the lot must be at least 5,000 square feet.

However, savvy developers are free to use either of two building-code loopholes to bypass the minimum lot size requirement: the “Historic Lot Exception” or the “75/80 Rule” (see detailed descriptions below). The city calls them building code “exceptions.” Both allow a standard-size lot to be divided into two substandard-size lots smaller than 5,000 square feet – a process often referred to as “short-platting” or “short subdivision.”

Over the last 10 years, a small group of local developers has become very adept at cobbling one of those exceptions together with other arcane building-code loopholes to wedge skinny three-story homes onto lots as small as 1,050 square feet (in what used to be the backyard or side yard of an existing home).

The neighborhoods are almost always stunned to learn that this kind of construction is legal (that a giant new home could legally be built in the backyard or side yard of a neighboring house). And they’re often furious that they were never even notified that such a divisive and unorthodox construction project was under consideration.

The problems that small-lot houses create for Seattle neighborhoods are immediate and long-term:

  • The tall, skinny houses typically tower over the surrounding properties and feature giant windows that stare down on the yards below.
  • The views that the surrounding homeowners once enjoyed are now blocked.
  • The sunlight is blocked for the surrounding homeowners located to the north and west.
  • Because the new homes are allowed to be built just five feet from the neighboring properties (one-third the distance required of all other homes), all the surrounding structures are at risk of increased fire danger.
  • With the fire safety, privacy, views and sunlight for all the surrounding homes compromised, the property values for those homes are dramatically reduced.

Loophole #1: The Historic Lot Exception
When the city enacted the 1957 minimum lot size, it exempted any undersized lots that already had permits (so the property owners wouldn’t lose their right to build on the land).

However, as former city council member Richard Conlin notes, many of the undersized lots exempted were never meant to be built upon at all: “These substandard lots, often times well below 3,000 square feet, were often created before 1957 for tax purposes. In some cases these lots were actually created by mistake when lot descriptions on more than one line were transcribed from hand-written records as two separate lots. Others had been intended to be erased by new plats or subdivisions that established legally developable lots.”

Today, more than 55 years after the original exception was created, the vast majority of the original property owners (the people the exemption was designed to protect) are dead or long gone. And the sub-lots are long forgotten. The sub-lots almost never appear on city plat maps. And the current owner typically has no idea that their lot includes one.

To find them, a few savvy developers have learned to dig through the city’s historical map archive, then, once they find a lot that qualifies, buy it out from under the owner at well below fair market value.

Former council member Conlin sums things up this way: “Unfortunately, there was no expiration date on the grandfathering clause, and recently some developers have rediscovered it and are using it to create infill housing that is not compatible with neighboring single family houses.”

Loophole #2: The 75/80 Rule
In the early 1980s, local developers started complaining that the city was running out of 5,000 square-foot lots and convinced city leaders that the situation would soon start to impact the tax revenue that new-home construction generates.

But instead of debating the issue in public, the city council and Department of Planning and Development chose a much sneakier tactic. They simply created another loophole that would allow developers to bypass the minimum lot size requirement. But this time they added some elements to try and ensure that the new lot created would be in-character with the rest of the neighborhood. It’s called the 75/80 Rule.

The 75/80 Rule allows developers to split one existing lot into two – if the new lot created is at least 75 percent of the minimum required for that zone (at least 3,750 square feet in a neighborhood zoned for 5,000 square foot lots), and the new lot is also at least 80 percent as big as the neighboring lots.

Like all building codes – and especially building-code exceptions – developers have learned how to manipulate every element of the 75/80 Rule to jam giant new homes into undersized lots that are totally out of character with the surrounding community.

The city refuses to close the loopholes
The city knows both of the above loopholes are extremely controversial, so city leaders rarely discuss them with the public, preferring only developers know about/understand them. But there is a section in the city’s Comprehensive Plan (provision LU67) that explains them: “Permit exceptions to minimum lot size requirements to recognize building sites created in the public records under previous codes, to allow the consolidation of very small lots into larger lots, to adjust lot lines to permit more orderly development patterns, and to provide housing opportunity through the creation of additional buildable sites which are compatible with surrounding lots and do not result in the demolition of existing housing.”

The city uses that section of the Comprehensive Plan to justify any and all loopholes created for developers.

DPD consultations
Finding lots that qualify for these exceptions is tough. But for a $1,000 fee, the Seattle Department of Planning and Development will actually coach the developer on the best way to get a lot to qualify. The resulting letters are called “opinion letters” (see a sample letter).

The DPD employees providing the coaching are typically the very same people who write and enforce the building codes. Private consultant and public watchdog all-in-one. It’s a one-stop shop.

A gold mine for developers
Not only does the developer get to double the value of the property by splitting the lot, the new substandard lot qualifies for other exceptions that make them a gold mine. For example, if splitting the lot equally would make the new lot too difficult for the developer to build upon (it’s oddly shaped or located too close to the existing house, for example), the DPD lets the developer reshape or relocate it through something called a “lot boundary adjustment.”

The developers are also allowed to use special “substandard lot” building codes that allow them to bypass standard height limits, standard setbacks and other typical building codes. The result: a new, three-story home that towers over all the surrounding homes – and pushes right up against them.

Many of these exceptions were introduced in 2010, according to a 9/10/14 investigative article by the Seattle Weekly: ”Four years ago, the City Council and the Department of Planning and Development looked at the low-rise zones and determined that they were ‘underproducing,’ says [Seattle city council member Sally] Clark, recalling the matter in her council office on a recent day.” The article adds: ”So Clark, using DPD [Department of Planning and Development] recommendations as a guideline, came up with a range of incentives meant to spur these types of [small-lot] developments.”

The homeowner gets shafted
Most people who sell their homes to these developers sell at well below their true market value, because the homeowner has no idea that their property qualifies to be split into two lots (doubling the market value). Then the homeowner feels like a fool and a bad neighbor when a new, three-story house shoots up in the backyard or side yard a few months later.

Sometimes, the home isn’t even for sale. In these cases, the developers use something called home stalking to find the owner and convince him/her to sell.

Our efforts to correct the situation
For two years (2012 to 2014), our group (representatives from neighborhoods all across the city, backed by 900 supporters) worked tirelessly to educate the public, lobby the city council and work with the Department of Planning and Development to close these two loopholes, or at least make the resulting homes more compatible with the surrounding neighborhood. See a summary of all that transpired.

To counter our efforts, the developers hired a full-time lobbyist and formed a lobbying group with the appealing name Smart Growth Seattle. That group, led by lobbyist Roger Valdez, proved especially effective at pressuring city council members and confusing the public (see a summary of the misleading arguments).

Out-spent and out-hustled by the developers and their lobbyists, our group was not able to get the loopholes closed. But in the end, we did get the city to pass new building codes addressing some of the worst aspects of these projects. That made the developers furious. See a summary.

Learn more
To see photos of side yard/backyard house projects, click here.

See all the news coverage this issue has generated.

See the effect these projects have had on neighborhoods like West Seattle, Laurelhurst, Fremont, Wallingford and Montlake, to name just a few.

Fortunately, there are things you can do to avoid living next to one of these projects.