Tuesday’s ruling on a Seattle housing policy suggests residents were being bamboozled by the policy equivalent of fake news.

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SEATTLE reached a turning point Tuesday when a hearing examiner excoriated City Hall’s plan to allow density to increase by as much as threefold in city neighborhoods.

For the first time in recent memory, the bluff was officially called on the city’s poor planning and misleading rhetoric as it enthusiastically boosts development.

Hearing Examiner Sue Tanner’s ruling suggests that residents were being bamboozled by the equivalent of post-factual, fake news.

Instead of creating more affordable housing as Mayor Ed Murray and the City Council proclaimed, the policy on backyard cottages would make housing less affordable.

The policy would create a bonanza for investors, increasing housing costs. It would also hurt poor and minority residents the policy was purported to help.

Officials presented the policy as a way to build innocuous backyard cottages and diversify neighborhoods. But experts cited in the ruling said it “would cause displacement of some populations within the city, particularly minority populations” in the south end.

Backyard cottages and mother-in-law apartments are already allowed in Seattle with some restrictions, such as a requirement that owners live on the property.

Crucially, officials wanted to remove that residency requirement, and allow more and bigger rental units on single-family lots. The changes would allow most Seattle houses to be converted to investor-owned, multifamily rentals.

Doing so would “accelerate gentrification, driving up home values and reducing the number of entry-level single-family residences available to immigrant populations, thereby diminishing the City’s diversity,” according to expert testimony.

Murray and Councilman Mike O’Brien introduced the policy as an affordability strategy. But city planners disclosed during the hearing that the objective was really to spur construction and new units probably wouldn’t be in the “affordable” category.

This turning point is important to more than residents feeling steamrollered by City Hall.

The Puget Sound region has a vested interest in Seattle maintaining its livability, infrastructure and residential appeal. The city’s ability to grow and attract companies and employees is essential to the region’s economic success. Its single-family neighborhoods will provide a lasting advantage if they withstand the current surge of Amazon.com growth and land speculators.

In the past, Seattle has been a model of progressive, inclusive governance. Tuesday’s ruling suggests that’s changing.

The ruling said planners minimized policy impacts and gave short shrift to potential harm. Tanner called for a full, objective environmental review of its impacts.

The appeal was filed by the Queen Anne Community Council. It’s a member of the Magnolia-Queen Anne District Council, one of the neighborhood advisory councils Murray dumped in July amid pushback on his growth proposals.

The appeal process provides valuable insight into the city’s political machine. It should embolden others to challenge extreme proposals and lead to renewed civic engagement.

City officials should be grateful for the chance to reconsider a divisive policy, especially since the hearing revealed that its outcomes are contrary to their stated values.

Housing advocates protesting that an environmental review hurts affordability and favors “not-in-my-backyard” homeowners should read the ruling.

Ignoring facts — the city shortchanged environmental concerns, housing costs will increase and the disadvantaged may suffer — puts such protesters in the same boat as those who refused to accept the FBI’s decision that Hillary Clinton shouldn’t be prosecuted. Their “NIMBYism” chant is Seattle’s version of “Lock her up.”

As Seattle updates its growth policies it should pay heed to lessons from Tuesday’s ruling. One is that residents care deeply about the negative effects unbridled growth has on their city and they’re tired of being spun. Another is that Seattle’s tight housing market is not a simple supply-and-demand problem.

The supply of single-family land in Seattle is finite and diminishing. Demand for this precious resource is nearly infinite, and comes from people wanting homes and investors wanting profits.

Officials must weigh these competing demands and balance them with interests of existing residents whom they’re supposed to serve.

Tuesday’s ruling is a welcome opportunity to start fresh, with a more transparent and inclusive process.