Special session called by Governor to fix Blake Decision

Lawmakers were called back to Olympia to fix in a special session, what they could not get accomplished during the regular session. With support from both sides of the aisle, lawmakers took only one day to pass Senate Bill 5536, that makes possession of illicit drugs illegal.

The Washington Supreme Court struck down the state's felony drug possession law in 2021, ruling it unconstitutional. Legislators put in place a temporary fix that treated drug possession as a misdemeanor. That measure, known as the Blake fix, was set to expire over the summer.

Instead, the new measure will now make illegal drug possession a gross misdemeanor, while encouraging both police and prosecutors to steer individuals to services. Those arrested could avoid prosecution if they agree to enter a pre-trial diversion program.

And a person could get a conviction for simple drug possession vacated by completing treatment. In addition, opioid treatment programs, both mobile and fixed-site medication facilities and recovery residences would be deemed “essential public facilities,” which follow a different process for approval in cities and counties.

This past week, a number of additional housing related bills have either been signed by the governor, or automatically became law without action.

Increasing the Supply & Affordability of Condominiums SB 5258 Condominiums are the most affordable type of home ownership, but the supply of new condominiums in Washington is among the worst in the country. This bill improves the condominium market by improving the process to repair condominium defects (“Right to Cure”), streamlines the process for construction of smaller condominium projects.

Expanding housing options with ADUs. HB 1337 This bill works to ease barriers to the construction and use of accessory dwelling units.

The Federal Housing Finance Agency says it will delay a controversial plan to help low-credit buyers by adjusting its pricing based critical indicators such as loan-to-values, credit scores, occupancy and number of units in a home. Called the new Loan-Level Pricing Adjustments (LLPA), it will be a tremendous help for borrowers with a DTI ratio above 40%.

But in FHFA’s guidance, higher income, or high-credit borrowers would end up paying MORE will added fees. It’s this fine print that raised concerns from the National Association of REALTORS®, especially when the costs appeared to be on the backs of borrowers with good credit. “It would have imposed a cost on borrowers at a time in the market when affordability is already stretched and only made them riskier,” said NAR President Kenny Parcell who applauded the FHFA reversing course, adding “Likewise, the FHFA’s decision to release a request for information on the other changes is a great example of good governance.”

The NAR team will continue to work with policy makers to help develop better language.

In his annual forecast for the National Association of REALTORS®, Chief Economist Lawrence Yun predicts Home Sales will bottom out later this year, before an upturn expected in 2024. He points to several key factors:

But Yun says the Feds will play a critical role in keeping the market strong. His recommendations were among the key policy recommendations being offered to lawmakers in Washington DC.