Is Urban Growth Boundary to Blame for Low Housing Supply in Portland Metro?

Portland Metro Urban Growth Boundary

Portland housing supply has been record low for the last eight years, which has been driving up not only home sale prices but rental prices.  The population has increased about 10% in Portland metro in the last 6 years.  Portland still is a place where people are moving to.  I still have a lot of out of state clients who want to buy a home in Portland metro.  Portland is becoming more and more attractive.

Peter Park, J.D.Portland people often talk about the subject of Portland being this new Portland full of modern buildings and amenities, which justifies the increasing housing prices.  While that statement has some merits, the heart of the issue is the lack of housing supply.  As I drive around Portland neighborhoods since I am a real estate agent, I do see some new constructions but most of them are being built on the spot after deconstructing an old fixer.  That doesn’t increase supply.  It just replaces an old one.

So the real solution to increase supply is to either build a massive amount of multi-family units such as condos and townhouses within the urban growth boundary or to expand the UGB altogether to build new housing developments around Portland metro.  The former is being done but due to high cost of lands, developers are only profiting from building high rise condos that are super expensive.  That doesn’t solve any issues here.  So we’re left with the issue of whether to expand the UGB or not.

Opponents of expanding the UGB argue that expanding the boundary will cause a lot of forest and farm lands to be converted into urban dwelling for people.  That will not only have serious impact on wildlife but also the consequence of forever changed landscape of Portland metro.  Most of us still say that we do not want Portland to turn into San Francisco and that is true.

Portland Metro Council was presented with a recommendation not to expand the UGB in 2015.  Martha Bennett, Chief Operating Officer stated, “Neither the population growth forecast nor the employment forecast of the draft Urban Growth Report warrant adding new land supply.”  Mayor Hales is also a big opponent of expanding the UGB.

After public hearings, work sessions, and 4,000 public comments received by the Planning and Sustainability Commission, the Metro Council voted to not expand the UGB in November 12, 2015.  The resolution was also supported by calculations showing there is currently enough buildable land within the boundary to accommodate the growth.  This means that there is enough land to build more multi-family homes, not detached single family homes.  The recommendation update says 123,000 additional housing units can be built in Portland without harming livability if 80% are in multifamily buildings constructed primarily in downtown, designated urban centers, and along major transportation corridors.  The remaining 20% would be homes in existing residential neighborhoods.

This recommendation ignores the fact that a downtown condo is not an option for families with children.  While the housing supply may become plenty at some point for young urban dwellers, supply of single family houses may still continue to be low for the next 20 years unless the UGB is expanded at some point.

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Peter Park

I'm a realtor with attorney experience representing buyers and sellers throughout the Portland metro area.
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