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Sunday, February 5th - Saturday, February 11th, 2023
In brief: Tuesday is both Valentine's Day and Election Day for the social housing initiative special election, so be sure to return your ballot if you haven't already; Microsoft and Google both announced new versions of ChatGPT-style AI-powered search engines that will be rolling out to the public in the coming weeks; powerhouse City Councilmember Teresa Mosqueda made the surprise announcement that she'll be running for a spot on the King County Council; the Seattle Police Department released their crime stats for 2022; the Northwest Multiple Listing Service released its real estate data for January; and, as always during the legislative session, there was a lot of activity in Olympia. 
Election Watch 2023
Tuesday is Election Day for Seattle's social housing initiative (I-135) special election, so be sure to return your ballot by then if you haven't already! At this point putting it in a drop box near you is your best bet, although mailing it also works as long as it's postmarked by Tuesday at the latest. If you aren't registered to vote at your current address, you can register and vote in person at the King County Elections headquarters in Renton up until Election Day (they'll be open from 8:30 am - 4:30 pm on Monday and 8:30 am - 8:00 pm on Tuesday). 
If you haven't made up your mind which way to vote on I-135, there were good articles about it last week from KNKX, Crosscut, The Seattle Times (first article, second article), and KUOW. Publicola also came out with a "yes" endorsement; and The Stranger and The Urbanist had previously recommended a "yes" vote, while The Seattle Times had previously recommended voting no.

The big news in local politics while I was off the week before last was that City Councilmember Teresa Mosqueda, who's been arguably the most effective member of the council for years and isn't up for re-election until 2025, announced that she'll be running for the King County Council District 8 seat that longtime incumbent Joe McDermott will be vacating at the end of the year. In doing so, she instantly became the odds-on favorite in the race, overshadowing Assistant Attorney General Sarah Reyneveld, who was the first to announce in the race. If Mosqueda is unsuccessful in her King County Council bid, she'll remain on the City Council and will be able to run for re-election to her citywide seat in 2025. [Seattle Times, Publicola, The Urbanist, KING 5]

In other City Council news, Council President Debora Juarez officially announced that she won't be running for re-election this year in District 5 (she'd made comments to that effect in a meeting last December), and  District 2 Councilmember Tammy Morales confirmed that she will be running for re-election. At this point, Dan Strauss is the only incumbent councilmember who's up for re-election this year and hasn't made an announcement one way or another about whether he plans to run (Erica C. Barnett spoke to Tammy Morales and Andrew Lewis, the only two district incumbents of the seven who are up for re-election this year who have announced that they're running). 

The City Council isn't alone in seeing high turnover of elected officials--two of the four King County Councilmembers who are up for re-election this year have announced that they're not running for re-election, and the state legislature this year had its largest freshman class in recent history because so many incumbents decided not to run for re-election last year. Sarah Grace Taylor wrote a good piece in the Seattle Times talking to current and former City Councilmembers about how the dynamics of being an elected official in Seattle have shifted in recent years, and made the job much less appealing than it used to be (many of the dynamics described likely translate to positions in other levels of government too). 

In other election news, King County Councilmember Girmay Zahilay and Seattle Port Commissioner Fred Felleman both announced that they'll be running for re-election; and urbanist tech entrepreneur Ron Davis announced his candidacy for the District 4 seat that Alex Pedersen will be vacating at the end of the year. 
Microsoft vs. Google
Microsoft had a big week, the centerpiece of which was the company's unveiling Tuesday of a fully revamped version of its Bing search engine that incorporates a more advanced version of ChatGPT, the OpenAI chatbot that's been taking the world by storm since it was released to the public in November. Microsoft has been a major investor in OpenAI since 2019, and is eager to use the company's newest technology to try to take market share away from Google, which has been the dominant player in the online search world for the last 22 years. The new Bing appears to be mostly only available to journalists at the moment, although you can sign up to join the waitlist here. [GeekWire, Platformer, New York Times]

Google, which created the technology on which ChatGPT and its competitors are based, held its own hastily put together event on Monday to announce a similar service that ChatGPT's runaway success put pressure on it to accelerate the release of, which will start rolling out to the public "in the coming weeks." In an unfortunate turn of events that's of no technical significance but that completely overshadowed their announcement anyway, Google's demo included a factual error (of which journalists using Microsoft's new Bing have uncovered many already, since accuracy isn't one of the strong suits of these large language models), causing the company's stock value to drop by $100 billion in a day. [GeekWire, The Verge, NPR News]

This is only the beginning of the chatbot/commercialized generative AI wars--while there are a lot of other companies getting into the space, Microsoft/OpenAI and Google (who just last week invested in a startup that was founded by former OpenAI employees) will be the two to watch in the coming years. Will we end up with a sci-fi-style natural language interface at the end of it all that lets us talk to our computers like an episode of Star Trek, or will it turn out that what are essentially really advanced autocorrect systems can never be made accurate enough to rely on in daily life? Only time will tell--but I for one am looking forward to getting my hands on both of them and trying them out.
Potential School Closures
Seattle Public Schools, faced with declining enrollment and an accompanying decline in funding from the state, is exploring options for potentially closing and/or consolidating some schools starting in the 2024-25 school year to save money. Most of the decline in student enrollment between 2019 and 2022 has come from elementary schools (John Hay Elementary in Queen Anne, for example, lost 38% of its students in that time period), and four of the five elementary schools that lost the most students were north of the Ship Canal. [Seattle Times, MyNorthwest]

Contrary to what you might think (or at least to what I assumed would be the case), Bellevue has been hit harder than Seattle in terms of declining school enrollment, with an 11% drop in the last three years vs. 8.5% in Seattle (and 4% statewide). The Bellevue School District has already proposed closing three elementary schools in the 2023-24 school year, and is facing significant pushback and organized opposition from parents whose children's schools would be affected by the closures. [MyNorthwest, KING 5, KING 5]

After the last three years, students of color now make up a slim majority (50.6%) of all students enrolled in public schools in the state. The number of students of color in the state's K-12 public education system increased by 49% between 2009 and 2022, while the number of white students decreased by 18%--and half of the decrease in white students happened between 2020 and last fall. There's been a significant increase in the number of students being home-schooled or attending private school since the start of the pandemic, two alternatives to public school in which white students are dramatically overrepresented; so it stands to reason that a large part of the decline in public school enrollment has come from white families opting out of the system. [Seattle Times]

Lower public school enrollment isn't an issue that's limited to Washington state; the Associated Press partnered with Stanford University to look at data from 21 states and Washington D.C., and found that total public school enrollment fell by 700,000 students between the 2019-20 and 2021-22 school years. Private school enrollment increased by 100,000 in the same period, and home-schooling enrollment grew by 180,000; but their analysis found that there are 230,000 students who are school-aged but not enrolled in school anywhere, including many younger kids. [Associated Press/MyNorthwest]
Crime Stats
The Seattle Police Department released its 2022 crime report, which showed that the total number of crimes reported to the department was up 4% from 2021, while homicides were up 24% (from 42 in 2021 to 52 in 2022) and motor vehicle thefts were up 30% (from 5,324 in 2021 to 6,920 in 2022). The violent crime rate reached a new 15-year high of 736 crimes per 100,000 residents, narrowly exceeding 2021's previous record of 729 crimes per 100,000 residents; and property crime rates remained well below their peak level in 2014 but increased slightly to from 5,730 per 100,000 residents in 2021 to 5,784 last year. For the fourth quarter, however, overall crime numbers were lower than the same time period last year, following a steady month-over-month decrease for most of the year. [SPD Blotter blog, full report PDF, Seattle Times, Seattle Times, KING 5, MyNorthwest, KUOW]

Portland, by comparison, had twice as many homicides and more than 50% more car thefts than Seattle, despite having 100,000 fewer residents. [Seattle Times]

In 2022 the Drug Enforcement Administration's Seattle field office seized 117% more fentanyl than it did in 2021; and the King County Sheriff's Office seized $17.5 million in drugs over the course of the year, including 750,000 fentanyl pills, 30 pounds of powdered fentanyl, 465 pounds of methamphetamine, and 26 pounds of heroin. [KING 5, MyNorthwest]
Meanwhile, in Olympia
General legislative news:
  • A bipartisan group of lawmakers held a press conference to announce their support for 13 different bills geared towards increasing the supply of housing across the state. [Seattle Times]
  • Claire Withycombe at The Seattle Times looked at the details of Governor Inslee's proposed $4 billion referendum to fund the construction of government subsidized affordable housing. [Seattle Times]
  • A conservative advocacy organization sued the state in an attempt to overturn the transportation budget that the legislature passed last year. [Seattle Times]
  • And there's an ongoing power struggle between news outlets and state legislators over the latter's attempts to shield their internal communications about deliberations on legislation from public disclosure requests by journalists. [Crosscut, Washington Observer - free, Seattle Times, MyNorthwest]
Passed out of the House or the Senate:
  • SB 5082, which would repeal the non-binding advisory votes on tax increases that you see in every general election (aka the Tim Eyman advisory votes), passed out of the Senate and moved to the House as HB 1158. [KING 5]
Passed out of committee:
  • HB 1110 / SB 5190 would allow "missing middle" housing statewide. These bills have been a top priority for a wide range of organizations this year and have widespread public support; they seem to have a good chance of being passed into law by the end of the session. [Publicola, KUOW, Washington Observer - $]
  • HBs 1388 & 1389 would limit the amount by which landlords can raise rents on their tenants. [Washington Observer - $]
  • HB 1329 / SB 5366 would make it illegal for utilities to shut off power due to non-payment during heat waves (something that's already illegal during extremely cold weather). [KING 5]
  • HB 1131 / SB 5154 would make the producers of packaging responsible for recycling it (rather than consumers) and create a bottle deposit system. [Washington Observer - $]
  • SB 5002 would lower the blood alcohol limit for being charged with a DUI from 0.08% to 0.05%. [Crosscut, Seattle Times]
  • HB 1094 / SB 5125 would give every child whose birth is funded through the state's low-income Medicaid program (Apple Health) a $4,000 baby bond that would accumulate interest and could be redeemed between the ages of 18 and 35 for use towards a down payment on a home, college tuition and expenses, or to start a business. [GeekWire]
  • SB 5339 / HB 1238 would make school breakfasts and lunches free for all public K-12 students. [Washington Observer - $]
  • HB 1260 / SB 5480 would remove a requirement that low-income recipients of the state's Aged, Blind, and Disabled (ABD) cash assistance program pay back the money they receive if and when they eventually qualify for Social Security disability payments. [Publicola]
  • SB 5236 would require minimum ratios of nurses to patients in hospitals. [Washington Observer -- $]
  • HBs 1108, 1324, and 1268 would enact various forms of sentencing reforms for adults and juveniles. [Washington Observer - $]
  • HB 1392 would codify consumers' "right to repair" their electronic devices by requiring manufacturers to make the necessary parts, tools, and manuals available. [KING 5, Washington Observer - $]
  • HBs 1143 & 1240 would add additional requirements for gun buyers and ban the sale of semi-automatic weapons, respectively. [Washington Observer - $]
  • SB 5209 would make voting mandatory (although there would be no penalty for not voting). [MyNorthwest]
Hearings last week:
  • HB 1474 / SB 5496 would add a new $100 document recording fee for home purchases and refinances that would generate an estimated $100 million per year to fund down payment assistance for individuals or their descendants who lived in Washington state prior to the end of racist restrictive covenants in 1968 that prevented many non-white people from purchasing homes. [KING 5]
  • SB 5476 / HB 1523 would allow farms to force farmworkers to work up to 50 hours per week for 12 weeks each year without being paid overtime, after the legislature in 2021 finally passed legislation making farmworkers eligible for overtime in the first place (which they hadn't been historically). [KING 5]
  • HB 1428 would legalize jaywalking, which currently disproportionately impacts Black people, low-income people, and homeless people across the state. [Seattle Bike Blog, KUOW]
  • HB 1516 would make Lunar New Year an official state holiday. [KNKX]
  • SB 5559 / HB 1479 would prohibit schools from using isolation or mechanical or "chemical" restraints (aka drugs) on students. [InvestigateWest, Seattle Times]
  • SB 5035 would classify possession of certain drugs as a felony; SB 5536 would make drug possession a gross misdemeanor; SB 5467 would make drug possession a misdemeanor with mandatory diversion to treatment; and SB 5624 would decriminalize possession of a "personal" amount of illegal drugs by adults and make it a misdemeanor for those under 21. 
  • HB 5614 would allow strip clubs to sell alcohol, something that both dancers and club owners spoke in support of. [Publicola, MyNorthwest]
  • HB 1541 would create the "Nothing About Us Without Us Act," which would require the legislature to appoint a representative from an underrepresented group to any task force or work group on an issue that "directly and tangibly" affects that group. [KING 5]
  • HB 1355 would slightly expand the number of people who qualify for property tax exemptions based on income. [MyNorthwest]
Last week in local corporations
In other Microsoft news, the company announced 617 more local layoffs from its Eastside offices, for a total of around 1,500 in the region so far (roughly 15% of the 10,000 total layoffs the company has announced); and antitrust regulators in the U.K. found that its proposed $68.7 billion acquisition of video game company Activision Blizzard--which would be the highest price ever paid by a U.S. tech company for an acquisition--would harm consumers. [Layoffs: Seattle Times, KING 5; Antitrust: MyNorthwest]

Boeing announced plans to lay off 2,000 employees in its finance and HR departments, with a third of the affected jobs being outsourced to India; and, after the last 747 rolled off the assembly line on January 31st, the company also announced plans to expand its 737 MAX assembly at its Everett plant. [Layoffs: Seattle Times, MyNorthwest; 737 MAX expansion: Seattle Times]

Amazon reported that it lost money last year for the first time since 2014, based largely on an 82% drop in value for the electric automaker startup Rivian, in which Amazon owns a 20% stake; Lauren Rosenblatt at The Seattle Times spoke to 15 former Amazon employees who were unhappy with the way in which the recent layoffs were announced and carried out; GeekWire reported that the company may or may not be working on a new retail project at the former New Seasons grocery store location in Ballard; and the Federal Communications Commission gave the go-ahead for the company to launch its 3,236-satellite Project Kuiper low-Earth-orbit broadband internet network (their version of Starlink). [Losses: NPR/KUOW; Layoffs: Seattle Times; Retail: GeekWire; Satellites: GeekWire]
Real Estate Corner
The Northwest Multiple Listing Service released its real estate stats for January, which showed that the median home price for houses and townhomes in Seattle proper was $803,750, up 1.7% year over year from $790k in January of 2022 and down 21.7% from its $1.025 million peak last May at the height of the market. The median home price on the Eastside, meanwhile, was $1.320 million, down 12.9% year over year from $1.515 million in January of 2022 and down 23.4% from its peak of $1.722 million last April. [Seattle Times]

Freddie Mac's rate tracker for 30-year fixed mortgage rates was at 6.09% as of last week and has been holding steady in the low-to-mid 6% range for all of 2023 so far, down from a high of 7.08% in late October and early November of last year but still significantly above 3.69% a year ago. 

Smaller cities outside the Seattle metro area have seen the largest loss of rental affordability in recent years, due to a combination of more rapidly rising rents and lower incomes. Median rents in Seattle were up 2.8% from 2021 to 2022, compared to a median increase of 13.5% in Walla Walla, 8.4% in Pasco, 6.8% in Vancouver, 5.5% in Bellingham, and 5.1% in Spokane in the same period of time, with some individual renters seeing rent increases of 30% or more. [Crosscut]

Paul Roberts looked at the state of the commercial real estate market across the region. Short version: downtown vacancy rates are way up, but there are still enough new buildings under construction in Seattle and Bellevue to add around 8% to the two cities' total office space by the end of next year. [Seattle Times]

And the Washington Post put together a great interactive tool that shows the percentage of real estate transactions in 2022 in which the buyer paid all cash, broken out by zip code for every major metropolitan region in the country. Most zip codes in Seattle are somewhere in the 15% - 25% range, with higher percentages in more expensive waterfront neighborhoods and the highest percentages in two condo-only downtown zip codes. [Washington Post; note that it's much more usable on a computer than it is on a phone]
Thank you to everyone who's sent me a real estate referral or used me as an agent yourself! If you need a residential real estate agent to help you buy or sell a home of any kind--or you know someone who does--I'd love to be of service. My website is here, or see here for client reviews. 
In Other News
Seattle and King County both ended the requirement that their employees be vaccinated against COVID, while Governor Inslee kept the vaccine mandate for state employees intact. [Seattle Times, KING 5, KUOW, MyNorthwest]

A Tukwila woman was killed in North Seattle when a drunk forklift operator drove his forklift across Aurora Avenue N and hit the SUV she was traveling in, which then collided with a landscaping truck. [Seattle Times, KING 5, MyNorthwest]

The U.S. Postal Service is dealing with staffing shortages so severe that in some places in the region it's no longer always able to deliver the mail to all of its customers every day, with expensive and difficult to access locations like Vashon Island among the hardest hit communities. [Seattle Times]

The state's Working Families Tax Credit, which will provide up to $1,200 to nearly 400,000 eligible households across the state who meet the program's income requirements, went into effect this year--but eligible families and individuals need to apply in order to get the money. [Seattle Times]

Detainees at the Northwest ICE Processing Center went on a hunger strike to protest deteriorating conditions at the facility. [Seattle Times, KUOW]

Some laid-off tech workers are using the opportunity to shift into jobs in industries that are helping to address climate change. [GeekWire]

FTX's now-former chief compliance officer lives in Seattle, and donated $5,800 to George Santos's campaign. [Seattle Times]

Fittingly enough, a week after Boeing's last 747 rolled off the factory floor, an Auburn resident bought the winning lottery ticket for the big $747 million Powerball prize from a local Fred Meyer. [KING 5, MyNorthwest]

A federal audit criticized the way Seattle has spent federal transportation grants in recent years. [Seattle Times]

The Seattle Department of Transportation announced that restaurants' existing outdoor dining structures will be allowed to remain in place. [Seattle Times]

And rumors of the Regal Meridian 16's demise may have been greatly exaggerated... [Seattle Times, The Stranger]
Ending on a high note
As a reward for making it to the end of this marathon-length email, here's an adorable video of a tiny baby sea lion in Ecuador (be sure to turn the sound on). 

And here are some super cool macro photos of the interiors of various musical instruments that look like otherworldly architecture shots.

Sol Villarreal
Broker, Windermere Real Estate
sol@windermere.com
solvillarreal.com
206-765-6108
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