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Additionally the limited amount of transit limits the amount of land that is most desirable for development, and some of that land faces issues with zoning, etc. Thats why DC is so intent on the street car system - to make more areas desirable for development.
Yeah I know that they're trying to get the area around Walter Reed more "hip" with a street car. So I guess the time is now to buy in that area. The Brightwood/Takoma/Manor Park area is one of the last relatively middle class neighborhoods in DC so we'll see how that works.
I didn't say people wouldn't go because it's too crowded - I said too expensive. I don't necessarily buy the increase supply and price drops argument. It works on paper but usually just attracts people able to pay more for flashy new buildings, increasing the overall allure of an area that allows landlords to charge more for even dumpy places.
I didn't say people wouldn't go because it's too crowded - I said too expensive. I don't necessarily buy the increase supply and demand drops argument. It works on paper but usually just attracts people able to pay more for flashy new buildings, increasing the overall allure of an area that allows landlords to charge more for even dumpy places.
increasing supply does not decrease demand, it moves you down the demand curve and reduces price.
Flashy new buildings are built because its not that much more expensive to build a flashy new building than a less flashy one, and the rents are much higher.
The allure of an area increasing DOES offset the supply-demand effect. Supply demand assumes the product delivered is the same. but of course a unit in a thoroughly transformed area is not the same product as one in a less transformed area, for lots of reasons. So when new supply comes to a neighborhood like say H street, it probably won't lower prices/rents on H Street. Cause as you say, the improvement in the neighborhood will offset the increase in supply.
But what will that do to the supply demand for units across the district? With more transformed areas, the ones already transformed will be less scarce. And thus cheaper. Again, thats all assuming all other things are equal - if more and more people WANT to live in the district, because its schools turn around, or gas prices increase, or urban living becomes even more fashionable, that could of course offset the expansion of supply. But in that case the number of people moving in would increase, not decrease.
If DC can't fix the school system and keep its tax base from continuing to bleed into the suburbs once children are factored into the household equation, then you might as well throw all the other planned developments in the article straight out the window.
And that is the most important problem facing DC. Young single people enjoy the amenities and attractions DC has to offer but they head to Maryland or NoVa because they don't want their kids in Dangerous Minds style schools unless theyre Romney rich and can afford private school. So many of my friends have had the same pattern in their lives: they live in DC then meet someone and want to start a family and scramble to move to the suburbs. Whatever DC does wrong is a lot less important than fixing the schools since it'll at best remain a yuppie playground, unless gentrification takes hold so completely that the hood is entirely moved to PG County but that won't happen in at the very least 20 years.
increasing supply does not decrease demand, it moves you down the demand curve and reduces price.
Flashy new buildings are built because its not that much more expensive to build a flashy new building than a less flashy one, and the rents are much higher.
The allure of an area increasing DOES offset the supply-demand effect. Supply demand assumes the product delivered is the same. but of course a unit in a thoroughly transformed area is not the same product as one in a less transformed area, for lots of reasons. So when new supply comes to a neighborhood like say H street, it probably won't lower prices/rents on H Street. Cause as you say, the improvement in the neighborhood will offset the increase in supply.
But what will that do to the supply demand for units across the district? With more transformed areas, the ones already transformed will be less scarce. And thus cheaper. Again, thats all assuming all other things are equal - if more and more people WANT to live in the district, because its schools turn around, or gas prices increase, or urban living becomes even more fashionable, that could of course offset the expansion of supply. But in that case the number of people moving in would increase, not decrease.
Yeah - I went back and changed it from "demand" to "price" right after I wrote it. I just put the wrong word in there.
Like I said, it always looks good on paper. I've never seen a place attract nice new buildings and wealthier residents / businesses and have prices subsequently drop, no matter how much housing supply there is. I think the improvement in the neighborhood almost always offsets the increase in supply.
And that is the most important problem facing DC. Young single people enjoy the amenities and attractions DC has to offer but they head to Maryland or NoVa because they don't want their kids in Dangerous Minds style schools unless theyre Romney rich and can afford private school. So many of my friends have had the same pattern in their lives: they live in DC then meet someone and want to start a family and scramble to move to the suburbs. Whatever DC does wrong is a lot less important than fixing the schools since it'll at best remain a yuppie playground, unless gentrification takes hold so completely that the hood is entirely moved to PG County but that won't happen in at the very least 20 years.
Schools are always a lagging indicator, not a leading one. The schools aren't going to magically get better and then people will send their kids to them. Typically, the middle / upper class creates the better schools because the parents are more involved, provide a more stable environment at home, give more directive toward academic success, etc... Just the reality of how things work.
While many still go to suburban districts once they have kids, a growing number are staying in the District, working to improve their particular school, and certain schools have shown remarkable improvement because of it and become quite sought after.
Question - from a "cash cow" perspective, who is the ideal newcomer to DC? I would have thought it was a single person or childless couple in good health with well-paying jobs. I don't find such cities enormously appealing, but it might be that, from a fiscal perspective, such residents are the types some cities would want to attract. Maybe that's just the same-old Richard Florida, "creative-class" stuff (putting aside the typical snarks as to how "creative" DC residents are).
The irony is that, if there are enough residents who can afford the tax burden, the cities can then afford to build new schools that, in theory, ought to start attracting families. Families will care more about the performance of the students at a school than the state of the facilities, but the combination of poor student performance in crumbling buildings can be a death spiral in urban schools.
The main thing I'd like to see in DC if it attracted more residents, though, is better retail. DC already struggles with retail due to the height restrictions, and so much of what is here now seems to fall into niche categories (healthy take-out; frozen yogurt; expense-account restaurants, hipster bars). If adding some people and density managed to make the DC street scene come a little closer to what's found in cities like Boston, SF or Montreal, that would be great.
I can't help but think that the ship has sailed on a resurgence of DC retail. So many people are doing more and more of their shopping online these days, and for good reason--it's incredibly convenient and often much cheaper. I'm guessing that the type of highly educated, professional people who tend to be moving into DC are even more likely to shop online than the average.
What kind of small businesses could open up in DC that are resistant to the shift toward online shopping? Obviously the DC restaurant scene has been expanding, as well as other kinds of food services. But other kinds of shops that make commercial districts in other cities 'cool'--such as independent music stores---I think it's clear that won't be expanding.
I think DC schools are in for a long haul. Maybe an expanded tax base can help WMATA's capital program, but DCPS is not an issue that money alone can fix. DC spends more per-pupil than just about any major city; it's on par with the wealthiest NYC suburbs. If educational quality was tied directly to spending, our DCPS students should be receiving a Sidwell-like education at $28,000 in total annual spending per student.
In my opinion, it's a cultural issue and environmental issue, not a money issue. When you have schools that even have a significant minority of students that don't have the support of their parents, don't value their education, don't see a future in it and are disruptive to the learning and social environment at the school, it has deleterious affects that money can't fix.
Three of my friends/roommates were one-time DCPS teachers that came here with all the good intentions in the world. They were dedicated to teaching, but all three of them burned out after three or four years of dealing with kids that had no parent or peer support systems.
When wealthy people move in, their tax dollar might flow to the schools right away, but that won't change the school environment right away, and these newcomers won't send their kids there.
I think that more charter schools like KIPP are going to be the models that turn the tide. One just opened in Shaw, and I see it as my highest hope for keeping my kids in DC.
Yeah - I went back and changed it from "demand" to "price" right after I wrote it. I just put the wrong word in there.
Like I said, it always looks good on paper. I've never seen a place attract nice new buildings and wealthier residents / businesses and have prices subsequently drop, no matter how much housing supply there is. I think the improvement in the neighborhood almost always offsets the increase in supply.
As I said thats logical, in terms of a local area - its different when you look at a larger market. I dont have data, but I think for example in Baltimore, the continued relatively rapid gentrification of South Baltimore/Locust Point and Canton during the period from 1990 to 2010 was accompanied by stable or declining real prices in less trendy gentrified areas such as Charles Village and Bolton Hill. I know in San Diego condos downtown declined sharply in the late 2000s while some areas continued to improve.
Its hard to see that in DC cause the whole inner part of the region has been so strong these last 10 years.
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