Hey Marc, that sounds like a neat house you own and have some good opportunity with the land. My team and I have also been contemplating how these new bills will affect ours and our clients' projects.
In the case of having a newly vacant subdivided plot of land, I do think building the max amount of units makes the most sense. Not only from an investment perspective but also from a public benefit standpoint. We gotta house more people. I hear you about the cooling of the market, but I think that's a short term viewpoint. Housing, especially in the Seattle area, will always be needed. Owning this asset long term and ethically using it is a great way to make money and help the issue.
The existing house is an interesting issue I've also been thinking lots (pun intended) about. My initial instinct is to keep existing construction just to keep things simple and not make a huge toll on our planet, especially if the house is in good condition. I suppose there exists some threshold depending on the condition of the house and how "worth it" it is to salvage it.
My go to strategy, without knowing much about you and your place, would be to subdivide the land, build the most dense and attainable housing possible on the new land, keep the existing house and add a DADU on the existing lot if possible.
So many options! Hope this helps. My team and I do these projects often in the Seattle area and are happy to chat more. We host monthly meetups and would love to meet you!
