Housing prices continue to rise in Central Kitsap

When Art Castle set out to figure out the fiscal impact home builders have in Kitsap County to educate Kitsapers, he got an education of his own.

In 2000, Castle, the president of the Home Builders Association of Kitsap County, collected information from the Kitsap County Assessor’s Office about the cost of new homes. On average, in 2000, a 2,000-square-foot home cost $233,709 to build. In 2003, that same home cost $298,193.

“About half of the homes being built are custom homes (which are not being put on the market),” Castle said. “These numbers included all the new homes in the Kitsap County Assessor’s records.”

Kitsap County has seen a somewhat stagnant population change since the mid-1990s, Castle said. Before 1995, the county’s population growth was a healthy average of 7 percent. Since then, the population growth has been about 1 percent each year.

“That’s a very modest population change,” he said. A one-percent change can be accounted for with birth and death rates and very few people moving into or out of the county.

“If you had four houses and one buyer, the price of those homes might be different than if you had four buyers and one home, which is the situation we have right now,” Castle said.

Added to the stagnant population are the effects of the federal Growth Managment Act, which is intended to control urban sprawl. The GMA deems that in high population areas, 18 residential homes or more can be built on one acre, while in rural areas the number is one residence per five acres. The result is more homes are being built on fewer lots in high population areas.

Frank Wilson of Windermere Real Estate, said GMA has had a profound impact on the cost of real estate in Kitsap County. He said, in his opinion, it was one of the biggest factors driving the cost of new homes.

“Back in the late 1990s, the Growth Management Act came into effect and pushed away some home builders,” he said. He added that small, independent builders have come into the county and helped out in the building crunch.

While he said other factors, such as the rising cost of lumber and labor, also have affected the cost of construction in Kitsap.

“We need to have a balance of affordable homes, good-paying jobs and a great environment to raise a family,” he said.

Meanwhile, GMA is forcing people to build more houses on fewer lots.

“That’s not what people want,” Wilson said. “When they come here from Seattle, do they come here because they want to live like they did in Seattle or do they come here because they want a house on an acre?”

Jason Rice, a senior planner with the Kitsap County Department of Community Development’s community planning department, said the GMA’s restrictions do tend toward one-acre or two-acre lots in rural areas and four or five homes per acre in the urban areas.

Rice added that another factor in the rising price of home construction is a shortage of lots in Kitsap.

“All the lots that historically have been easy to develop are gone — they’ve been built on — now we’re left with lots that are constrained by the environment or have other limits or restrictions and we’re finding an increase in costs associated with developing them.”

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