The REAL Cost of Living in NoVA/Greater DC (Arlington: real estate market, condos)

[ACWhite]

Originally Posted by lmw36

I got into a discussion about this with a coworker. I've also worked in the finance dept in my company (aerospace and defense industry), lived in a few different cities (with this company), so I'm aware of who makes what (yes, I know experience is slightly different, but the averages are pretty much the same). Her argument was the higher salary. When I look at my fathers salary (around 110K, varies because he makes his own hours, and his equivalent salary in the DC area, it's only about 15K higher. After taxes, not that much. He also has a boat and a paid off house. I see keeping that boat as a huge expense if he were to move here.

I see that an "average" house in NoVA is 500K at least. I move outside of NoVA and I can buy myself a decent home for 200k and under (again, depends what you want). My salary may be 10-15k less, but when I see that my commute is 15 minutes instead of an hour, food is cheaper, my home could be less than half, along with several other factors? I'm not sure it would be worth it to me to ever move back there. I loved the DC area, however I think I'll settle just fine for my sporadic weekend visits now.

If I ever go back, my pay would need to be more than I'm worth, and that just won't happen anytime soon.

I think more people need to go through the process as you have and compare all of the ins and outs, even the ones that are hard to quantify.

I think also the gap is really widening now, with many employees here being sequestered or in danger of layoffs, with others overloaded with work after others are downsized, and with many employers not even directly in the govt-related industries taking advantage of the situation by giving raises (if at all) lower than inflation for several years running, for all or most of their employees. Although many people in the rest of the country have also faced this, many of them are seeing their employers pull out of this, while some employers here seem to have no end in sight, at least not yet. The economics of markets will eventually catch up.

I say this as someone who moved here because I love this area, and still believe it's a great place to live. But for most people, there are a lot of great places to live. For them, I am not sure how much larger the gap can get before a lot of good people will leave and many other good people won't come here.

[michgc]

Originally Posted by ACWhite

Aside from the recession (etc.) I suspect part of the problem for the low pay is the tremendous people that the universities there draw, allowing employers to be very picky and not to pay a premium. When I was in grad. school in another location (more of a college town), I found it amazing how many great low-level staff the university hired--very smart, with masters' degrees--they were often trailing spouses while their spouses were working on PhDs. They were paid next to nothing but were priceless in what they did for the university. I'm not equating this type of job to what you are looking for -- but just am guessing that the same principle applies for higher level job as well.

I actually do think that's part of the problem. In some ciites, there aren't as many educated citizens. Here there are so many, and like you said, with the economy not being great, many are unemployed or underemployed. So they are all looking for jobs, and employers can be picky and not offer much.

I will say that when I lived in NoVA, I did not see many signs of the recession. It wasn't until I moved to NC that I saw what people in other parts of the coutnry were talking about. NoVA definitely has much more job opportunities and stability than most places, even with the sequestration.

[Carlingtonian]

Originally Posted by michgc

I actually do think that's part of the problem. In some ciites, there aren't as many educated citizens. Here there are so many, and like you said, with the economy not being great, many are unemployed or underemployed. So they are all looking for jobs, and employers can be picky and not offer much.

I will say that when I lived in NoVA, I did not see many signs of the recession. It wasn't until I moved to NC that I saw what people in other parts of the coutnry were talking about. NoVA definitely has much more job opportunities and stability than most places, even with the sequestration.

NYC is like that in the publishing industry: Even though it's expensive to live there, and even though an education and writing/editing ability is required (and not all that easy to find), the "glamor factor" of living there somehow draws tons of young people who are willing to work for peanuts and live under someone's bathroom sink.

I don't know much about the Research Triangle, but if a large college population there is keeping salaries low with a glut of educated young people, then why doesn't that happen here too? Just in the District, we have Georgetown, GWU, Catholic, American U--and then in NoVA we have GMU and grad programs of UVA and Polytechnic. Not to mention U Maryland. One would think that they would bring a lot of young people who would drive salaries down. Or perhaps employers here actually value experience!?

[cy_flembeck]

Originally Posted by ACWhite

You may be forgetting that the AMT may wipe out many of those advantages because it doesn't allow SL tax deductions.

Student Loan interest for most people is much smaller than mortgage interest, property taxes and state income tax deductions.

[RamblingMan]

Originally Posted by Carlingtonian

NYC is like that in the publishing industry: Even though it's expensive to live there, and even though an education and writing/editing ability is required (and not all that easy to find), the "glamor factor" of living there somehow draws tons of young people who are willing to work for peanuts and live under someone's bathroom sink.

I don't know much about the Research Triangle, but if a large college population there is keeping salaries low with a glut of educated young people, then why doesn't that happen here too? Just in the District, we have Georgetown, GWU, Catholic, American U--and then in NoVA we have GMU and grad programs of UVA and Polytechnic. Not to mention U Maryland. One would think that they would bring a lot of young people who would drive salaries down. Or perhaps employers here actually value experience!?

I do think DC has a glut of educated young people driving down salaries in at least some fields. You find a lot of very capable, highly educated young people working as interns or for very low salaries in a lot of fields that are very dc-centric, including on the Hill, in international affairs, and in NGOs (particularlly those involved with international relief and development).

[michgc]

Originally Posted by Carlingtonian

NYC is like that in the publishing industry: Even though it's expensive to live there, and even though an education and writing/editing ability is required (and not all that easy to find), the "glamor factor" of living there somehow draws tons of young people who are willing to work for peanuts and live under someone's bathroom sink.

I don't know much about the Research Triangle, but if a large college population there is keeping salaries low with a glut of educated young people, then why doesn't that happen here too? Just in the District, we have Georgetown, GWU, Catholic, American U--and then in NoVA we have GMU and grad programs of UVA and Polytechnic. Not to mention U Maryland. One would think that they would bring a lot of young people who would drive salaries down. Or perhaps employers here actually value experience!?

The Triangle is a small metropolitan area. The main issue is that there just aren't very many jobs. Secondary, for those jobs that there are, there are plenty of qualified people. DC is much bigger with many more jobs, so even though its population is highly educated, there are many more jobs to go around. To me, what was most noticeable in my move to NC was the size of the employment section of the newspaper or online - it's much smaller here, even taking into account the difference in population. There are just fewer jobs available overall.

[ACWhite]

Originally Posted by cy_flembeck

Student Loan interest for most people is much smaller than mortgage interest, property taxes and state income tax deductions.

"SL tax deductions" = state and local tax deductions, including income tax, property (real estate) tax, etc., not student loan interest. State and local taxes are sizable in many states, and you have to pay them even if you have paid off your mortgage. The AMT does not allow these deductions. Also, people who have paid off their mortgages but who have incomes that are not particularly high here but would be high in other places also don't enjoy the benefit of mortgage interest deductions. So one can't say that these deductions go up with income - and the law still limits the amount of itemized deductions you can take if your income hits a certain point. So if you are in Waco, and you are a little under that point, you can afford a much more expensive house, meals out, etc., and pay lower taxes that someone in this area with a higher income, who also has to pay higher taxes.

[Carlingtonian]

Originally Posted by ACWhite

... So if you are in Waco, and you are a little under that point, you can afford a much more expensive house, meals out, etc., and pay lower taxes that someone in this area with a higher income, who also has to pay higher taxes.

AMT--$9,000.

Student loan interest--$5000.

Not living in Waco--priceless.

[ACWhite]

My point is that the federal income system should take into account geographical differences in cost of living, but it does not. I'm simply agreeing with your original point and adding more examples of why it's currently unfair.

[Carlingtonian]

Originally Posted by ACWhite

My point is that the federal income system should take into account geographical differences in cost of living, but it does not. I'm simply agreeing with your original point and adding more examples of why it's currently unfair.

Right! Good points and a good example.

(Just couldn't resist making a jab at Waco, a town full of people who want to drag Texas back to 1830.)