Salaries and Housing in NOVA (Arlington, McLean: for sale, rent, insurance)
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Plenty of them do. If you think the outlook is so bleak, then move somewhere else. Plenty of affordable houses in Scranton and environs. There's a single-family house available in Carbondale for $45,000.
Yet another "if you don't like it then gitttt out" response, but why am I not surprised? Heaven forbid someone identifies a problem and tries to generate discussion aimed at brainstorming solutions to that aforementioned problem, right?
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Originally Posted by normie
Yup, that's reality. Too bad a lot of people don't get it, it seems pretty obvious to me.
Ironically, the same people who scream about needing more affordable homes are often the same ones who scream how terrible it is to be building housing developments.
It's something to think about--when you restrict development, home prices soar because supply is low.
Considering the rampant urban sprawl in NoVA is amongst the worst in the nation with new construction going on everywhere we looked when we were in the area, and every leasing agent I came across seemed desperate to court me into their complex to fill many vacancies, it's obvious that this is not a "supply vs. demand" issue that has caused housing prices to soar to unattainable levels.
In most cases prospective homeowners are advised to not commit themselves to a mortgage that exceeds thrice their annual household income if they don't want to be "house-poor." If a home is $600,000, as most single-family detached dwellings in Fairfax County seem to be nowadays, then that household would have to have a gross income of in the neighborhood of $200,000 in order to comfortably afford it. How many singles do you know that make $200,000 annually? There are dually-employed professional couples with Ph.D.'s that I know of in my own area that don't make that much annually, so how is one person expected to achieve that salary level by a reasonable age? If you don't feel as if the NoVA housing market is unfairly slanted against single-income households, then I have a bridge in Brooklyn I'd love to sell you.
The median household income in many towns in NoVA is about $110,000. Therefore the median sales price on a home should be in or around $330,000. How many towns can you rattle off in Fairfax County where half of the single-family homes sell for below $330,000? If you're having difficulty naming them then yes, this area's housing bubble NEEDS to further burst OR, if the median home sales price is currently, perhaps, $500,000, then the median household income needs to rise to $166,667. I don't understand why that's such a complicated concept. By saying, more or less, "people are willing to pay $600,000, so too bad for you that the market is so unfairly skewed" what solution does that provide to those of us who are a single-income householder and are likely to be forever? It's good that those of you in your 40s, 50s, 60s, and 70s were able to buy at a time when most people earned $50,000, and most homes were $200,000 or less, as you are sitting on tidy profits to retire on when you sell your homes, but what about those of us today who are earning $75,000 while housing prices have tripled? What are we supposed to do in order to afford a home on our own?
Considering the rampant urban sprawl in NoVA is amongst the worst in the nation with new construction going on everywhere we looked when we were in the area, and every leasing agent I came across seemed desperate to court me into their complex to fill many vacancies, it's obvious that this is not a "supply vs. demand" issue that has caused housing prices to soar to unattainable levels.
Most of the new sprawl is happening in outlying areas, not Fairfax County. Median home prices in places where sprawl is still occurring, like Prince William, are lower. It is definitely a supply vs. demand issue- the number of houses close to DC is severely limited.
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If a home is $600,000, as most single-family detached dwellings in Fairfax County seem to be nowadays, then that household would have to have a gross income of in the neighborhood of $200,000 in order to comfortably afford it.
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The median household income in many towns in NoVA is about $110,000. Therefore the median sales price on a home should be in or around $330,000. How many towns can you rattle off in Fairfax County where half of the single-family homes sell for below $330,000?
Who says everyone is entitled to a single family house? You can buy a townhouse or condo for much less than 600,000. Housing is not out of reach for the guy making 110,000 a year. You're right that most people can't afford a single family house here, and that comes back to the supply vs. demand issue. There's a very limited supply of single-family houses, so most people rent an apartment or buy a condo/townhouse.
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It's good that those of you in your 40s, 50s, 60s, and 70s were able to buy at a time when most people earned $50,000, and most homes were $200,000 or less, as you are sitting on tidy profits to retire on when you sell your homes, but what about those of us today who are earning $75,000 while housing prices have tripled? What are we supposed to do in order to afford a home on our own?
You work hard, save money, buy a condo. Keep saving money and when your salary goes up and your condo appreciates, then you buy the single-family house. Or you buy a house in an area that is cheaper.
ScranBarre, don't look into income levels - IMO there is a weak correlation between income and housing price; always look at wealth. This is a wealthy area with a lot of accumulated wealth. We bought a TH in Vienna with our parents' help; same situation with my friend with a condo in Dupont. We're the product of normal middle upper class families (doctors, fortune 500 executives), not celebrities or CEOs. We're educated (Ivys and top 20 grad schools) and we make significantly more than the average income in Fairfax. There are a lot of attorneys in this area from top 5 schools making 200K/year. DC is (was?) also a big center for private equity - for years, the people in the industry made at least 1M/year. Also think of the biotech corridor in MD - the salaries in the industry, especially in sales, are high. A good handyman or nanny can also make 60K/year.
This is not an area where a single person would buy a SFH in Fairfax or Arlington. We're looking into a SFH because we have a baby and we need more space and the supply of houses near the metro and in a good school district is very limited, so the prices are high.
Welcome to America, this is life. I'm from Europe, and it is MUCH worse there with housing, prices, and interest rates.
Sorry if this is long
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Originally Posted by ScranBarre
Yet another "if you don't like it then gitttt out" response, but why am I not surprised? Heaven forbid someone identifies a problem and tries to generate discussion aimed at brainstorming solutions to that aforementioned problem, right?
Considering the rampant urban sprawl in NoVA is amongst the worst in the nation with new construction going on everywhere we looked when we were in the area, and every leasing agent I came across seemed desperate to court me into their complex to fill many vacancies, it's obvious that this is not a "supply vs. demand" issue that has caused housing prices to soar to unattainable levels.
In most cases prospective homeowners are advised to not commit themselves to a mortgage that exceeds thrice their annual household income if they don't want to be "house-poor." If a home is $600,000, as most single-family detached dwellings in Fairfax County seem to be nowadays, then that household would have to have a gross income of in the neighborhood of $200,000 in order to comfortably afford it. How many singles do you know that make $200,000 annually? There are dually-employed professional couples with Ph.D.'s that I know of in my own area that don't make that much annually, so how is one person expected to achieve that salary level by a reasonable age? If you don't feel as if the NoVA housing market is unfairly slanted against single-income households, then I have a bridge in Brooklyn I'd love to sell you.
The median household income in many towns in NoVA is about $110,000. Therefore the median sales price on a home should be in or around $330,000. How many towns can you rattle off in Fairfax County where half of the single-family homes sell for below $330,000? If you're having difficulty naming them then yes, this area's housing bubble NEEDS to further burst OR, if the median home sales price is currently, perhaps, $500,000, then the median household income needs to rise to $166,667. I don't understand why that's such a complicated concept. By saying, more or less, "people are willing to pay $600,000, so too bad for you that the market is so unfairly skewed" what solution does that provide to those of us who are a single-income householder and are likely to be forever? It's good that those of you in your 40s, 50s, 60s, and 70s were able to buy at a time when most people earned $50,000, and most homes were $200,000 or less, as you are sitting on tidy profits to retire on when you sell your homes, but what about those of us today who are earning $75,000 while housing prices have tripled? What are we supposed to do in order to afford a home on our own?
Long? Thanks for the chuckle, considering my diatribes are usually ten times the size of your poignant and very well-written reply. You make some very valid points, and I thank you for being so respectful (unlike many others on this sub-forum who fly off the handle at the drop of a hat). Thank you.
I don't begrudge people who are wealthier than I, and I applaud them for their success over a few generations. The ones I begrudge are people who are wealthier than I and then proceed to say "too bad; life sucks; boo hoo" that their wealth and their corresponding willingness to use that wealth to pay artificially inflated housing prices being asked for by developers has driven the market to unattainable levels for those of us who didn't have the same financially-advantaged backgrounds over a couple of generations to permit us to live comfortably in this area with a "jump-start." I'm also aware that the same issues with housing affordability for those who are not derived from affluent backgrounds exist in more places than just NoVA (NYC, California, and some international cities like Moscow come to mind for being similar offenders).
I grew up being told that the financial "rule of thumb" was never to spend more than thrice your gross annual household income on housing, and since this area's median housing price far exceeds the median household income there's no way that people are going to be able to argue with me that the housing market in NoVA is not overdue for "correction" so that people can comfortably afford housing costs unless employers here decide to become generous and jack up everyone's salaries (which is unlikely since salaries here are already the highest, on average, in the nation). For me to be considered "low-income" in NoVA on a salary that is considered "normal" in MOST areas of the country is solid evidence that the market is overinflated.
I don't begrudge people who are wealthier than I, and I applaud them for their success over a few generations. The ones I begrudge are people who are wealthier than I and then proceed to say "too bad; life sucks; boo hoo" that their wealth and their corresponding willingness to use that wealth to pay artificially inflated housing prices being asked for by developers has driven the market to unattainable levels for those of us who didn't have the same financially-advantaged backgrounds over a couple of generations to permit us to live comfortably in this area with a "jump-start." .
You can begrudge all you like, but that won't change the reality that housing prices are driven by supply and demand. As long as there is a healthy demand for the limited supply of houses inside the Beltway in good school districts, then the prices of those homes will be beyond the reach of those with modest incomes. Just as those who earn modest incomes are unfortunately unable to buy homes in Malibu, or the upper East Side of Manhtattan, or Beverly Hills, or Winnetka, or Greenwich.
It's good that those of you in your 40s, 50s, 60s, and 70s were able to buy at a time when most people earned $50,000, and most homes were $200,000 or less, as you are sitting on tidy profits to retire on when you sell your homes, but what about those of us today who are earning $75,000 while housing prices have tripled? What are we supposed to do in order to afford a home on our own?
You know what? Things haven't changed that much. Back when I was in my late-20s, making a combined salary of $40,000 per year, I was buying my first townhome. I was whining with the above "vent" just as you are. Think about it--$108,000 with a $40,000 per year income. My parents, who were/are not rich by ANY sense of the word helped me with the downpayment. It was a VA assumption loan so I got to get into it with very little money down. Interest rate was 9.5%. Honestly, if you ask me, it is FAR easier to get a house now. Most young couples in this area are earning more that $40,000 per year and can easily snatch up a condo/townhome in this market (provided they aren't trying to live in Fairfax/McLean/Vienna area) for under $200,000. And the interest rates are phenomenal. I actually think it's easier today to get into a home.
Now if you are trying to go from no-ownership to ownership of a single family home in Fairfax, you're probably going to have a difficult time, although I know one young couple under 30 with a modest income that got a short-sale in Springfield under $300K.
Your first home, the one you make money on which takes YEARS, is the home that gets you into your "dream" home the next time.
Too many young people (not "you" ScranBarre, just in the general sense) want it all right away.
So before you go on about how lucky us old folks are, it really was never that easy. I had a townhome in beautiful PG County, Maryland (NOT my first choice) that made enough equity for my downpayment on my single family home in Prince William County. Sometimes, at first, you have to get what you don't really want.
The house i grew up in in Springfield is now assessed at 306,000. It sits on a 13000 sf wooded lot, close to a park and school. Has a garage, too. To say it cost 600K for a home in NoVa is absurd.
And you know what, the same thing was going on even way back in the early 60's when when I was in my 20s. My first apartment was a tiny place near downtown Houston that I shared with a bunch of roommates. We'd sit around, complaining about "the man" and how "the man wants to keep us down, and it will always be like this, man."
I remember all my friends sitting around, smoking cigarettes and complaining that none of us would ever be able to afford our own homes. And we were convinced that we were damned to our poverty forever! Because the generation before us had it easy man, but we knew real pain! Nobody I knew had an apartment all to themselves. If you really wanted to live in a house, people told you to go move into a commune... and you know what, for a short time I did. Back then, it was a serious suggestion.
Some of us got tired of complaining, and figured out ways to accomplish what we wanted. And what I wanted was a tiny little 900 sf condo. It seemed impossible but somehow after 2 years I managed to buy that place. Achieving that first condo was probably one of the biggest struggles I ever went through. Now that seems laughable--real estate gets easier as you get older.
And you know what? Every generation goes through the same thing. When I stopped thinking my parents had it so easy--in other words, when I grew up--I learned a lot of things about them. Like they once thought buying a house was an impossible dream, too. They lived in an apartment when I was born. Yet they figured out a way... and so did I... and so will young people today.
BTW, great post Christine. Lots and lots of solid thinking.
The whole "starter home" philosophy has gone by the wayside. Some many youngsters expect to be able to skip the affordable condo, townhouse or house-in-the-not-most-desirable-area and want to be able to move into their mcmansion right out of college. That's the disconnect. I, like many before me, started in a $140,000 SFH in PG County (not my first choice but you do what you have to). Sold that home, moved into an apartment, then bought a townhouse for $165,000. Sold the townhouse for $250,000 and bought the SFH. I had no help from anyone financially. I had just saved and saved and saved for a decent downpayment and was lucky enough to ride the market up. I don't begrudge those who did even better that I did with their timing.
We just had a post on here the other day from a single mom looking to buy a condo this year. Her price range was in the low-mid 200s, IIRC, which is totally doable for many people on one income. And she was finding stuff out there. If she really wanted a SFH instead, people were offering her links to homes with long commutes under 200K. Reading that thread, anyway, I certainly didn't get the feeling that single people were excluded from the market entirely.
But she did have to make a tradeoff between space and commute, and that's the big issue here. If you have enough traffic-choked 2 hour commutes in your life (or enough summer evenings when the Orange Line breaks down during a thunderstorm), you might start to think, "I would give ANYTHING to live closer to work."
And in NoVA, a lot of people really can afford ANYTHING. Sellers know that, too. Average wage-earners, single people, young people, and the just plain unlucky are going to be competing with those people who have big resouces for the very limited amount of land inside (or near) the Beltway.
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Heaven forbid someone identifies a problem and tries to generate discussion aimed at brainstorming solutions to that aforementioned problem, right? 
You make some very valid points, and I thank you for being so respectful (unlike many others on this sub-forum who fly off the handle at the drop of a hat). Thank you. 
