January 30, 2008
Morning Roundup: On the Fence Edition
Good morning, Washington. Say you're like some of us, and pretty much convinced at this point that you'll never be able to buy a home in Washington, D.C. The combo of home prices still being relatively high despite the downturn in the real estate market, and a stubborn refusal to attend law school, just sure makes it seem like home ownership will always be a pipe dream for many of us. Well the Center for Housing Policy has put out its annual report, and it only confirms our suspicions: it shows that the median price of a home in D.C. in 2007 was $371,000, meaning a buyer would have to have an annual household income of $121,197 to qualify for the median home. Sure, it's not as bad as some cities like San Francisco or Los Angeles, but it's still pretty grim when you consider the median household income in D.C. is right around $45,000.
Dulles Rail Hullabaloo: Va. Gov. Tim Kaine was running all over town yesterday trying to convince everyone that the Dulles Rail plan wasn't actually dead just because federal funding is now in question. But when a Gov. starts prepping people for the possibility of much higher tolls, even if he does say he doesn't support that idea at this time, you can bet the outlook, as the magic eight ball says, is not so good.
District Announces Neighborhood Development Financing: Mayor Fenty announced a new project Tuesday designed to encourage neighborhood development that puts $95 million toward new building projects. The city has identified six corridors on which it would like to see new development that would qualify for the financing: Martin Luther King, Jr. Avenue SE; South Capitol Street; H Street NE; 7th Street/Georgia Avenue NW; Minnesota Avenue-Benning Road and Pennsylvania Avenue SE. Think any crucial corridors were left out of that list?
Briefly Noted: Washington Academy charter school will close in a month due to financial problems ... MPD detective accused of assaulting prisoner ... Dozens of frozen ferrets found in Virginia Beach home ... Woman escapes abduction attempt in Takoma Park.
This Day in DCist: In 2007 we wondered how there could be yet another fire at the Farragut North metro station, and in 2006 we took on those horrifying new neighborhood nicknames real estate developers seem intent on using.
Photo by m hoek
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How about New York Avenue between Bladensburg Road and Florida? Surely they can do better than warehouses, gas stations, fastfood, and hooker motels.
"$371,000, meaning a buyer would have to have an annual household income of $121,197"....yeah for suckers with a 30y/fixed...
But hell I bought when money was cheap, who knows what kind of hoops you have to jump through now. Plus you have to consider that most houses in DC that are priced below 400K probably need about another 50k min of remolding; and for condo folk, your HOA fees can easily raise that income bar up 10-15%.....Well I guess there is always Sterling Va.
http://novabubblefallout.blogspot.com/2008/01/loudoun-county-on-market_29.html
Thank you for linking to the renaming of the neighborhoods.
"butt butt" always makes me laugh.
Yeah, I was about to say that's why God invented Sterling, then I remembered that Satan invented Sterling.
If you want cheap, move to the depopulating ghosttown that is Prince William County. Folks were crying when DC had no tax base because neighborhoods were semi-vacant ghettos. Now it's all hip and trendy to live downtown, everybody's whining because it's too damn expensive. You can't have it both ways. There are still a few skanky neighborhoods where you can buy a dump with only a 50/50 chance of getting shanked on the way to the bodega. Or you can just wait for the boomers to retire and pick up their houses at firesale prices. Of course, you'll have to fumigate the place to get rid of that old people smell (a delightful musk of Ben Gay and failure).
Thank god I can post this from my converted sex bunker/abandoned missile silo in Omaha where it's still affordable.
That story about the ferrets is horrifying. What kind of sick person hoards living creatures like that?
That stretch of NY Avenue puts the "ho" in hotel.
Hey, unless mommy and daddy are paying for it, not even law school guarantees you can buy a median priced home in D.C., for anyone doing the math.
If you want to buy a home in pretty much any large city in this country you are going to be paying close to $371K, so I don't think we fare that badly in that report. It's still pretty steep, but with two incomes it does become a lot more affordable. Plus there are still lots of areas in the metro area that fall below that price. You just won't have three starbucks on the corner or be able to walk to Whole Foods.
I'm not sure where they got that $121k income number; I don't remember that in the CHP report, and it doesn't match up with the real-world numbers that I see every day; a $65k/yr buyer could qualify for a loan to purchase a $371k property w/o much problem, and while there's still a disparity there between median income and median sales price, it's one that makes sense given the area's strong job base and odd distribution of salaries.
Actually, a median-income borrower could probably qualify for that property, too, just because underwriting guidelines are still relatively lax (though very tight compared to the last few years). That buyer would quickly find themselves house-rich and life-poor, though, and be pretty miserable.
For those who like numbers: a buyer using a conventional/conforming 30-yr fixed-rate mortgage to purchase that median-priced property would get a rate of around 5.75%; that translates to a PI payment of around $1750/mo on a loan of around $300k, or an overall housing payment of anywhere from $1900-$2300/mo. depending on taxes, insurance, condo/coop fees, etc. With good credit history and minimal balances carried on credit cards, etc., a $65k/yr borrower would have a debt-to-income ratio of ~35%-40% which is about normal for this area for borrowers, and well below what some lenders will qualify people for.
And for those who protest the assumption of conforming financing (meaning 20% down): DC has one of the most generous first-time home buyer programs in the nation, with up to $77k in assistance towards down payment/closing costs. Also, having to save up a bit before being able to buy a home isn't necessarily a bad thing.
>Thank god I can post this from my converted sex bunker/abandoned missile silo in Omaha where it's still affordable.
I call shenanigans - the missile silos are well outside Omaha city limits. I think you meant "from my emo-licious Conor Oberst Shrine/sex bungalow in midtown Omaha."
Fenty has a remarkable propensity to take credit for initiatives that he didn't develop. While the inititive might have just had a cash infusion, the initiative is by no means new. Developed by the Williams administration, it has been around for years. District agencies, particularly DDOT and the DC Office of Planning already completed the plans and are currently moving dirt in several of these avenues.
Rhode Island Avenue NE/Route 1, particularly the commercial corridor from 18th to Eastern Ave. New York Avenue is moving along, in part b/c of Abdo Development.
I agree with Jamie. Rhode Island Ave is so often overlooked as a grand boulevard in our city. It's a lot more attractive than NY Ave and there is some great storefront properties available between 18th St NE and South Dakota.
I agree with Jamie. Rhode Island Ave is so often overlooked as a grand boulevard in our city. It's a lot more attractive than NY Ave and there is some great storefront properties available between 18th St NE and South Dakota.
I remembered that Satan invented Sterling.
"We got a 7-11, we got a gas station, we got a pizza joint. There. Shut the fuck up. Go to bed."
Quoth Sterling, Virginia's most famous native. Also, he does a pretty funny bit on Arch Campbell, for those of you who are keeping track of notable locals.
"Fenty has a remarkable propensity to take credit for initiatives that he didn't develop."
As a native Chicagoan (Richard M. Daley, Mayor), this just makes me laugh and laugh and laugh.
There's buttloads of affordable housing in DC. It's just unsafe.
I'm sick to death of people saying DC has gentrified to the point that people can't afford it. Trendy, high-demand neighborhoods are certainly expensive. No shit. That's because they are trendy.
I could find you hundreds of affordable housing options in DC or suburbs without trying very hard. It's just that they'll be in unsafe areas or in boring burbs.
DC doesn't have an affordable housing problem. It has a safe housing problem.