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Friday, July 24, 2009
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66 comments:
Wow, was that stock market galloping up yesterday on the existing home sales report? Or just a new belief in the rigor of this rally? Or should I, as always, stop trying to psycho-analyze the stock market?
In response to yesterdays conversation the reason I am buying a TH is that this is what I want to be living in for the next 5-10 years. I think part of this is that I am younger than most people here, but both myself and my fiancee are in our young 20s. We have no interest in having a family for the foreseeable future. So a SFH just means more maintenance and a less open floor plan. We are choosing a high end TH that is less than a decade instead of a similar size SFH although both are similar prices.
I think Cara also could afford a SFH, but is frugal and would prefer to save for an extended time period to buy her dream home. By her own admission she isn't going to get the 8K house credit so she makes over 170K. If she really wanted to she could buy a house at 3 times her income like most of our parents did(when rates were higher) and she would have a 3,000 sq. ft. brick house on half an acre.
It is true that our parents got lucky and had things pretty easy. Basically our grandparents built the nation into what it was with hard work and they had very little wealth. Our parents generation got to live of off the prosperity of our grandparents. While we actually need to live off our own property as other countries are starting to amass wealth and we can't just buy there products for virtually nothing.
I think this problem is also exacerbated in DC because of the population growth. Population has been growing at ~3%/year here for a very long time. We obviously can not have as much land as our parents because twice as many people live in the same size area.
My last point is I also think that our generation spends a lot more money on non-necessities than our parents. Most of us go out to eat 5+ times a week compared to probably less than one for our parents. We all have our own car, which was not nearly as normal 30 years ago. We all have 2+ computers and 2+ TVs in the house compared to 1 of each for our parents generation. Lets not even start looking at things like smart phones, IPODs, and designer hand bags. I may be wrong, but I am pretty sure we just choose to spend our money in a different way and then wonder why we have nothing saved and don't live in a big house.
Cara-
The housing news helped, but it was up a lot before that. There were a lot of really strong earnings reports yesterday. Basically analysts had thought every company was going to do terrible and so far nearly every Dow component has handily beat expectations(Microsoft's earnings were weak last night so we may see a sell off today). I think people realize that even if it is a slow recovery companies earnings are still respectable and money in the stock market is at least as safe as money in treasuries.
The earning report cycles crack me up. Analysts pull a number out of thin air as an estimate and when a company 'beats' it their stock pops up. Who cares if that company lost their shirt in the quarter - all that matters is that they beat the mythical number analysts assign to them.
The web and books provide a flood of evidence that stock market analysts have no qualifications to provide numbers and ratings like they do. They have no responsibility to do real research on the companies they follow and plenty of reasons to assign biased numbers. It's all a sham.
housebuyer, and Jeff B.
Thanks for the insight, I wasn't following the market news yesterday so I figured you guys could fill me in.
To clarify, we actually do just barely qualify for the full $8k, (the limit for that being $150k). It's just that, since for us that's equivalent to just waiting 4 more months to have saved up that amount we're intentionally ignoring it in our calculations.
1 TV, used from another post-doc 6 years ago, 2 computers, one 6 years old, one older and "bought" from a friend for $50, cell-phones and cable and netflix, but no ipods, iphones, blackberries, a hybrid car, but just the one between the two of us, almost paid off, out to dinner? Normally once every 10 days or so, but more if we're stressed out, but I do buy the osso bucco, rack of lamb, line-caught salmon and other extravangances at the grocery store, on a semi-regular basis. We eat much better at home than we do out... It's pretty cheap so long as the meat portions are under half a pound.
Live like grad students but eat like kings. But as you all know, I'm cheap and debt averse.
JeffB-
I agree analysts are not particularly useful. Although recently it seems like most companies are reporting ~20% below last year on average. Although that clearly isn't good there may be reasons their stocks are going up seeing that the market is still down 30-40% from last year.
Cara-
That is actually pretty impressive. I rarely find people in my income bracket that spend similar amounts to me. The only real thing that is different is we out a lot more, although this is no more expensive than eating in for us. You get served way too much food when eating out so most of the time we just split one meal and it end up being ~$10-15 for two people. Which is about what we spend when we eat at home when you cook pasta, chicken, and a veggie.
housebuyer,
I always feel guilty splitting an entree. We used to also eat a lot of chicken, but that's the one area of our budget that we've allowed to grow as our income has grown. We still eat chicken and pork, just not a frequently, and more often will go vegetarian to balance out our more expensive meals at home. The cheap vegetables are the ones in season!
(I also can't eat out often, lactose intolerance means if I cook it at home with all my own ingredients it's fine, but eating out is a minefield, especially with the recent trend towards everything tastes better with more butter, I blame Ruth's Chris.)
Cara-
Yeah we mostly eat chicken for health reasons. We want lean proteins and the fiancee doesn't like seafood which basically leaves chicken. The killer is both of us really like berries and you can spend a small fortune on things raspberries and blueberries. You look down and next thing you know you just have a $5 snack :-D
I'm guessing the majority of us that frequent this blog are of the frugal variety :)
My wife and I have a similar lifestyle to you Cara. We're generally no-frills at home with food considered our main luxury. The way I see it we can pretty much buy whatever we want at a grocery store and it will still be cheaper than eating out. So we tend to spend a bit on groceries.
I have plenty of friends that don't have any savings and plenty of debt. I have *no* idea how they spend all their money. I would have difficulty spending enough that I went into debt. I don't know how they do it.
Also, to reveal my hippieness, both my wife and I are vegetarian. That saves us some money in restaurants and also at the grocery store.
housebuyer,
Yeah berries are a killer. I'm terrible, I almost never buy fruit... and prefer to eat vegetables when their incorporated into the recipe...
But when you settle down, you could put in strawberry boxes, and maybe a rasberry bush (although they are kind of an invasive pest of a plant).
Still, a $5 luxury is money well spent, in moderation.
Cara-
I couldn't agree more particularly when the luxury is having you live a healthier lifestyle.
JeffB-
I have this link for you :-p http://www.blogadilla.com/wp-content/uploads/2009/06/carnivore-support-group.jpg
Just kidding I actually find it impressive when people are able to eat vegetarian our society really doesn't make it easy on you.
For everyone I just heard back from the house I put a bid on yesterday and they lowered their price 1%. Our max bid still 6% under this we are having our agent talk to theirs to see if they might accept the max bid. If not we will just bail on this. We went to some houses yesterday that looked nice.
And in follow up on the SS, Jeff had already asked these questions on our behalf, and shared the answers with us when I brought it up. We're satisfied that it stands a darn good chance of going through. Enough that we're ready to give it 45 days for the bank's response.
housebuyer,
Yeah, that's a "we're not interested" counter. Oh well, plenty more fish in the sea.
Yeah I saw that pic a few days ago :)
There are a plethora of good things about being a vegetarian, it's a shame that the crazy militants scare so many people off. It's slowly becoming more mainstream and less 'weird' though. It's actually pretty easy to be a vegetarian now too, certainly easier than it was 10 years ago.
Jeff B,
I know you said vegetarian not vegan, but I have to say the proliferation of vegans has made my life as a non-diary eater much easier. When in doubt, just take the vegan option.
Have you tried Afghan Kabob on Rolling Road in Springfield/Burke (I'm not good with boundaries)? It's vegetarian entrees are deelicious (as is the rest of their food). And unlike Indian restaurants which often use tons of ghee, I've never felt bad after eating there.
Cara,
I haven't tried Afghan Kabob, I'll have to check it out the next time I'm in that area. I don't often go into Kabob places because it's hit or miss whether they offer vegetarian options.
To go even further off-topic have you read up much on lactose intolerance? It's a pretty interesting subject genetically. The majority of people in the world are lactose intolerant.
Wikipedia entry
Jeff B,
You should check it out, they have a whole page of vegetarian dishes, and almost all the side dishes are fabulous veggies, and many of the specialty dishes can be prepared vegetarian.
Yeah, I've read that entry. It was funny, a french friend of mine claimed that no one in France could be lactose intolerant because they all eat cheese, which between the two of us doing research led to the quality of life saving discovery that I can eat any cheese as long as it's aged over 2-3 months. If it has flavor that means the beasties have done their job of eating the nasty lactose sugar for me!! Mmmmm, pre-digested foods!! Yum!
Sorry for the way way way off-topic.
I love Afghan Kabob! They were closed for the longest time due to a fire in the kitchen. Glad to hear they are back and we can visit again!
You guys are making me salivate! As a fellow foodie, I feel for you. First time I went to london and ate all the non-pasteurized cheeses a whole new world opened up for me.
As a total aside, Im a commited carnivore, but I could easily be a vegetarian if I lived off the cooking common in India, or the Horn of Africa.
Speaking of which, if you havent tried east african, you it is a vegetarian's delight. There are a number of Eritrean, Ethiopian, Djiboutian restaruants around here that are quite tasty!
Kristin,
If you're thinking the one on Rolling Road behind the Sunoco, it's open.
Guys!!
Please eat your berries!! No Guilt!!
They are great for you & you can afford them as YOU DON'T OWN A HOUSE!!
At least that's how I justify my weekly grande latte @ Starbucks every Saturday morning when the hubby stares at me when I say I want one...
We don't own a house - we can afford this!
:0)
Spunky-
I totally agree with you, we can afford it and that's why we eat lots of them. Saying we should eat unhealthy food so we can save 1% more money would just be silly.
housebuyer, spunky
Which reminds me that once we buy a place, I'm vaguely worried that my husband will start spending money like water after our diligence of saving for the DP.
We've put off a new digital camera (it died), he wants to replace the bedroom furniture he bought (for TN where the rooms are a lot bigger). He wants a new computer (understandable with how much work these have been), who knows what else? Oh, yeah, treadmill. See, the list of wants goes on and on. And we will probably eventually buy all of these things, just not all at once, or even all within 1 year.
I want to know when all you great chefs are going to invite me over for dinner????? :-)
Ace,
I can do Afganie, Persian & Cajun
Spunky :)
Fellow foodies, I am eating a bowl of blueberries right this very moment. Yes, I spent $13 on two Costco-sized boxes of 'em two days ago, and they are almost gone. And they were worth every blessed penny. Just you wait til I hit up Giant for their sale on cherries this week. And I've been raiding my blackberry and raspberry bushes. Berries...nature's candy.
Cara, funny you should mention the lactose intolerant thing. My husband's family is from India, and I believe all Asians are lactose-intolerant. Go figure.
Looking for awesome deals on excellent seafood and produce? Head to your nearest international grocery store. One just opened a mile away from me, and I am in heaven. Excuse me while I go put together some channa masala for dinner tonight...
Wait, was this a housing bubble blog? ;)
Speaking of which, my brother has been trying to buy an investment property in Manassas, and it's crazy on the low end. 95%+ of places U/C. Now he's keeping an eye on a Fannie/Freddie foreclosure database to anticipate places coming for sale.
Ace--
I have Indian, Thai, and Cuban. Come on down, and we'll end with a bonfire ;)
I can make a mean bowl of cereal with regular or soy milk (for you lactose-intolerant types). :-)
Re: Lactose Intolerance
I've heard that the process of homogenization ("standardization" of the size of the cow protein molecules?) is what causes or worsens lactose intolerance.
It reminds me of research related to breastfeeding: human milk proteins are perfectly suited for infants and toddlers; babies not exclusively breastfed have lower hemoglobin rates because the relatively large cow's milk proteins are too large for intestinal absorption, causing barely perceptible, but actual, intestinal bleeding. (That factoid was found on kellymom.com.)
How to link this to the affordability of housing for people with young families? 1. You can raise infants relatively inexpensively, by breastfeeding and by following the diaper free movement (I haven't done the latter, but wish I had), 2. the above is easier done if there is a caretaker at home (meaning either one less income, or income spent on a nanny/babysitter); 3. fewer people can afford an at-home caretaker or can afford to lose one income when all their income is eaten up by mortgage payments. If diapers and formula are both necessary, the cost of them-- unlike mortgages--won't bankrupt you, but they sure do make a dent.
I think places like Whole Foods must have some fresh, organic non-homogenized milk products that might be easier on a lactose-intolerant stomach....
Tabitha
Asian markets are indeed your friend.
Ace,
I'd say we specialize in one-pot meals, which means Cajun, braised meats, stews, rissoto, curry, anything that generates enough leftovers for lunches, so that the late in the week meals can be quick ones.
housebuyer,
I don't know anyone who eats out five times a week and I know a lot of single, childless people who would presumably be the most likely to eat out a lot. (But maybe two income families with kids eat out the most?)
I think in terms of demanding more the most relevant factor is our society has demanded larger and larger homes with nicer kitchens, baths, flooring, etc. Homes built in the 1990s and 2000s are much larger than homes built in the 1960s or 1970s. But I think a lot of that already factored into the average home prices of the late 1990s.
As for population growth -- I think that would have been more of a factor in the 1950s-1970s. Here is Fairfax County's population growth:
1900 18,580 —
1910 20,536 10.5%
1920 21,943 6.9%
1930 25,264 15.1%
1940 40,929 62.0%
1950 98,557 140.8%
1960 275,002 179.0%
1970 455,021 65.5%
1980 595,754 30.9%
1990 818,584 37.4%
2000 969,749 18.5%
Est. 2007 1,077,000 11.1%
Despite the humongous population growth in the 1950s and 1960s, many of us here have parents who were not priced out of the market when they bought around then.
Now, obviously land is more scarce in Fairfax County than in the past. But I think that would be an explanation for why you might be pushed out a few miles west than your parents. But I don't think it explains being pushed out to Ashburn or Gainesville.
tbw
thanks for the population stats.
Don't people in Ashburn work somewhere in the Tech corridor? Or at least one of the two people?
(not really relevant to your point though)
Also I should note my commentary was assuming someone buying in their early 30s which seemed to be the mean growing up. You (housebuyer) have noted you are buying in your mid-20s so I think that explains part of it.
I think that's part of the market failure of the 2000s. People in their 20s became a larger part of the market (thereby increasing demand for smaller housing) and yet there's no evidence I see that people in their 20s had more income than the previous generation. Indeed, I see a lot of evidence that 20 somethings in the DC area had lower incomes if you compare real and not nominal dollars.
[Just to be clear I don't think there is a right age to buy a home. Some people will be able to afford it earlier than others. When the market demands 20% down though most people cannot do it in their 20s.]
Cara,
True, the vast majority of people in Ashburn work in the tech corridor giving them a reasonable commute.
But around 2005-06 people I knew who worked in DC were bemoaning the fact that they could only afford Loudoun or PWC. And they were like that is crazy I'm not living there and commuting to DC. I think that's part of why the housing bubble eventually fell apart. Enough of us said enough is enough. We should not have to commute that crazy distance.
Also in 2006 I remember a co-worker's daughter who worked as a teacher in Fairfax County was considering buying a home in Fauquier County and the co-worker and I agreed that was too far away and it was crazy people had to consider things like that.
tbw,
Yup "drive until you qualify". I remember that. It was nuts.
Cara,
Yeah. In the pre-bubble era what was more likely was "I want more house/land" so they drived further out. But there it was a conscious decision. They wanted a McMansion or 2+ acres of land so they lived further out. But if they were willing to take the quarter acre and modest home they could have lived further in.
I know a few commenters here have consicously decided to live further out to have a lot of land. I have no problem with that.
tbw,
Indeed. There is a big difference in making a conscious trade versus feeling like the only place you can "live" (which was the same thing as "buy" back then) was a TH with a huge commute.
There's a slippery slope in between the two though. Says me who's a sucker for fake victorians or faux craftsman homes. But, I just refuse to do the commute, not for a house.
TBW-
No one at your office eats out every single lunch. I would say most of my office eats lunch out 5 times a day and probably dinner 3ish times.
I think the problem with population growth is that in the 50s although there was a ton of growth there was still tons of green land to develop. If you look at a map of land inside the beltway it is starting to get pretty full. To get the next 10-20% more people we either need to build taller building of have more people work/live in further out areas.
Tabitha-
I love Costco fruit you get so much of it and it is normally better than local stores fruit. My last couple of sets of blueberries there have been to die for :-D
Arkey, are you back on the market?
housebuyer,
Does the building cafeteria count as "eating out"? If so, then yes I can see where you get the five day stat.
I was contemplating how many people I know eat out at restaurants or even fast food places per week. I don't think that reaches five.
However, I think workers may eat out for lunch less than they did in the past. As work demands increase people have smaller and smaller lunch breaks. And many of my older colleagues bemoan the loss of the "three martini lunch." :)
TBW-
I guess I don't really know lunch stats from the past. I guess you are right that a lot of people eat at the cafeteria which is only quasi eating out. I have only worked in the Tysons area and nearly everyone eats at the mall everyday sometimes fast food sometimes sit down
housebuyer,
Interesting. I used to work in Tysons but places where you'd have to drive to the mall (maybe you worked at one of the offices in walking distance?) and so people did not go out to eat as much. Although they would from time to time (and usually carpool as a group somewhere.)
Yum! Sounds like a fabulous eclectic mix. My specialty is desserts--the unhealthy kind--one reason I want a house with a bigger kitchen is to expand my cooking horizons!
TBW-
Yeah I work in one of the 3 buildings that is directly across from the mall so it is a 5 minute walk. I imagine if the walk is 10-15 minutes no one really has time to do it.
I'm nowhere near as frugal as I ought to be. Part of it is 'household building'. Part of it is a desire to buy quality so I don't have to buy again shortly afterwards. But a lot of it is convenience as well as a desire to enjoy life. It slows down the house-buying goal, but at the current prices I still couldn't afford almost anything unless I'd saved up an almost all-cash down payment, so I clearly haven't missed much. And I've enjoyed life very much in the intervening 4 years.
here's an interesting place
http://franklymls.com/DC7086514
4BR, 2BA, it's charming, the neighborhood
isn't great, but, it's tolerable.
Hi Tabitha..yep, back on the market
Do you have Mich license plate?
pat-
Have you seen the inside of the house. Seeing the house sold for 750K 3 years ago that's pretty impressive they are trying to sell it for 344. The outside looks nice although as you said the neighborhood is a little rough.
I just wanted to comment on housebuyer's 1st comment.
I do agree to a large extent with a lot of what he is saying . . . but I'll point out a few things.
"We obviously can not have as much land as our parents because twice as many people live in the same size area."
I somewhat agree, but mostly disagree. While it is true that the population has obviously gone up dramatically, it is also true that cities have expanded. So while Fairfax might have been out in the boonies 30 years ago, those folks would have commuted into D.C. b/c the jobs were in D.C. vs. Fairfax. Now job centers are in Fairfax and people can commute from Loudoun, Fauquier, etc. I'm sure in 30-40 years job centers will be in Manassas, etc and people will from Rappahanock, etc.
The point being that while the population of the area has increased job centers will also move to compensate.
The other point being that in the U.S. and in the world there is way more land available then is being used right now. Take a cross-country trip and you will see that there is plenty of land and plenty of space for job centers to grow and houses to be build.
"My last point is I also think that our generation spends a lot more money on non-necessities than our parents. Most of us go out to eat 5+ times a week compared to probably less than one for our parents. We all have our own car, which was not nearly as normal 30 years ago. We all have 2+ computers and 2+ TVs in the house compared to 1 of each for our parents generation. Lets not even start looking at things like smart phones, IPODs, and designer hand bags. I may be wrong, but I am pretty sure we just choose to spend our money in a different way and then wonder why we have nothing saved and don't live in a big house."
Fair enough, but I view iPods, plasma tvs etc. like candy, it feels and tastes great but I personally can't measure my standard of living by iPods and tvs.
I'll never forget traveling to Argentina 2 years ago, most everybody had some sort of cell-phone yet they live in housing that is crumbling, horrible infrastructure and borderline 2nd/3rd world in parts. So sure their livestyle was inhanced by a cellphone, but what would you rather have a decent house and no cellphone or a crappy cinderblock house and a cellphone?
As for cars . . . and all the other junk, okay great we all have cars but they are almost always on a 5 year loan and then most people buy a new car at the end of the 5 years . . . so you're perpetually in debt to own a car. Today's society is permeated with the monthly payment. If it fits in my monthly payment, I can buy it . . . nevermind I'll be paying on it for the rest of my life.
Seriously think about what would happen if most of the credit people use disappeared, if you actually had to use layaway or buy things in cash . . . how much of what we have is really based on credit? And credit is a time-shift, buy today with a penalty when you could by tomorrow with no penalty.
Credit pulls forward future demand to the present and can thereby rob the future in favor of the present.
So sure we have iPods, iPhones, computers, tvs, etc . . . but like candy does that really sustain us or is it just robbing us of the future.
How much of the wealth and supposed higher standard of living is really higher or are we just borrowing today in order to short change tomorrow.
I personally believe while our parents didn't have as many nice things there were definitely more wealthy than I am at my stage, why? Simply put b/c they didn't have to borrow the future in order to pay for today. In the 70s I would venture most people had a house as a debt, and not much else. . . today you have house, school, car, credit card, etc.
Do we really have a higher standard of living or is it all just an illusion?
gte-
That is an interesting question you pose about the standard of living being an illusion. Another interesting question would be how wealthy would we have been if we didn't buy things using debt. If we bought a nasty used car for a couple of years while we saved for a new car we would not be paying high interest rates on everything, which would obviously make us much wealthier.
It would be a really interesting study to see weather we would be richer than poorer than our parents if lived comparable lifestyles and tried to avoid debt like they did.
maybe you two should watch elizabeth warren
on the coming collapse of the middle class
pat,
Where do you currently live and why do you keep posting homes around that area? I suspect most people who post on this blog wouldn't last a week even renting a home in that neighborhood. I did some googling and this is something I found
Intern Guide to Finding Housing in D.C.
Here is the most relevant line:
In looking for housing, you should keep in mind that certain areas are safer than others within the DC area. In general, avoid housing within Northeast and Southeast DC past 11th street. If you decide to live in Northeast or Southeast DC, keep in mind that it is usually safer in areas nearer to the Capitol.
Also, during a year that there were two murders of Gallaudet students Dr. Jane Fernandes (of Gallaudet) noted the following to the Washington Post:
Dr. Jane Fernandes: The safety and security of students, faculty and staff are our top priorities. We are taking every step to ensure safety on campus. At this time, we have 100% I.D. checks at the front gate. Access to the residence halls is via smart card assigned to those who live there. We have asked all residents to sign into the dorms and show their I.D. cards to enter the dorms. Non-Gallaudet visitors are not permitted to enter the dorms. We have called upon faculty and staff to volunteer working in the dorms at night. They have responded in large numbers and are monitoring the wings in each dorm. We have a very visible presence of police officers on campus which helps us feel secure. We have cameras mounted on the outside of buildings. I believe we are doing everything possible to ensure that students are safe.
---
I don't think GWU or Georgetown do that. In fact, I know GWU does not do that since I have walked around its "campus."
arkey--
no, but we are one of the many big-family-airport-vans around here.
good luck!
gte, housebuyer,
Speak for yourselves. My parents always bought their cars on loans. Sure, if there was a lump sum inheritance during the life of that loan, they'd just pay off the rest of the car, but other than the most recent car paid for with a tiny portion of the proceeds from my grandmother's Silicon Valley condo, that's always been after the fact.
My dad bought 3 boats with loans over the years. They always had maxed out credit cards in the summer when my mom wasn't being paid. It would be, "which one should I put this grocery trip on honey?" "The sunoco card, dear, I paid off $300 to them this month."
How do you think I got so debt averse? They also put away a huge amount for retirement, and pulled it all from the market only a month after the most recent peak, but, my childhood is filled with memories of the stress of debt. And I don't want to think about how much they paid out in interest over their lifetimes. Given the matching funds on retirement that effectively doubled any money going there, they were still coming out ahead keeping their cash-flow that tight, but...
The debt society has been alive and well since at least the 70s.
TBW,
I'm currently renting in South Arlington, near columbia pike, but I'm a city kid at heart, so I'm interested in
cheap locations in transitional neighborhoods.
I'm not interested in Anacostia, but,
you look at the 14th Street Corridor, that was in
the 80's risk your life, now, it's quite nice.
the 10th street corridor is now the sketchy corridor.
NY avenue used to be take your life in your hands in the 80's and 90's, now the XM complex is really nice.
Florida avenue used to be take your life in your hands now it's Sporty.
so i'm interested in something that has potential
in either south arlington or a transition neighborhood of DC.
TBW i've been looking at 10th St NE
which is the edge of transition.
Pat I think its a matter of knowing what you are getting into.
I am interested in neighborhoods that are somewhat sketch. A few of them I now think are "fine", yet my parents (who live in their suburban coccoon) are scared shitless of those same areas.
If it were me, I would get out of the car, walk the streets, (both day and night) and see if the feeling of safety meets your personal comfort level. Meet a neighbor or two, ask them what they think about the direction of the neighborhood (take it with a grain of salt as they are likely to want more pioneers like you to move in).
My only knowledge of that area comes from a friend who worked at Gally for the last 15 years. In her estimation, during that time, its gone from "horrible" to just "bad".
In that case, I think the trend is your friend. In another 10 years, while I doubt it may be another adams morgan, it very well could be another U street.
Pat, just be aware... "gentrification" is not some inevitable process that will reach everywhere eventually, and it can go both ways.
A lot of what was driving the process in recent years were the super-high real estate prices in this area leaving people with two choice, sketchy neighborhoods or super commutes.
With prices falling the way they are gentrification will likely slow, if not roll-back in some areas.
Cara,
The debt society has definitely been around for a long time. I would argue that your folk were prob. more the exception than the rule.
I remember when I grew up in the 80s that a 2nd mortgage was a stigma . . . now who doesn't have a 2nd mortgage! I think it is the reverse now . . . the ones trying to be frugal and stay/get out of debt are the exception vs. the rule.
While you grew up in a family that had debt, just be glad you learned the right lessons from it. Many families that didn't have debt never taught their kids the value of money and how to stay out of debt.
"Leroy said...
Pat, just be aware... "gentrification" is not some inevitable process that will reach everywhere eventually, and it can go both ways.
A lot of what was driving the process in recent years were the super-high real estate prices in this area leaving people with two choice, sketchy neighborhoods or super commutes.
With prices falling the way they are gentrification will likely slow, if not roll-back in some areas."
Pat - I think leroy is somewhat correct. However one of the reasons the bubble bursting was so much worse in the exurbs than in DC was that it had no support, whereas, the move into urban areas was being driven (and supported by) true demand from individuals who want to live in urban areas.
We know for example that after leaving for decades (1950-2000) approximately 34,000 white people have returned to DC from 2000 to 2008, the largest influx of white population in 140 years.
You might assume this was caused by the bubble. Specifically, whites moved into DC because they were priced out of first choice suburban neighborhoods.
THis assumption however may not be correct. Individual records of annual migration show that whites movement "back to the city" was strongest 1999-2002, slowed down during the bubble years 2002-2005, and is now (2006-2008) starting to speed back up again.
This is the reverse of what was expected, and indicates whites were not moving into DC because they were "priced out" of their first choice areas. Turns out, they truly wanted to be there in the first place (an indication of why prices did so much better here than in the "drive til you qualify" exurbs).
Leroy is right gentrification is not inevitable - a riot or some other social movement could reverse the progress of the last 10-12 years. However a number of demographers believe there is a full generation or two of people who think like you do and should help support prices.
By the way, this is not just my interpretation of things. I was actually very recently tipped off to this "speed up, slow down, speed up" over the last 10 years by the demographers at the Brookings Institution.
http://www.brookings.edu/
They are actually quite helpful if you have census or other demographic data that you are wondering about. Feel free to give them a call.
anon
we spent yesterd ay PM driving around, checked out the H Street corridor, the Florida Corridor
and the 1st street corridor.
parked walked around chatted to people
certainly florida avenue in the 90's was very rough
the neighborhood there is now transitioning.
Capital Hill in the 80's and 90's was rough and now
it's yuppie central.
what i like about this place is it's a duplex, so as a 2/1 by 2, we should be able to rent the 2nd place for around 2000/month.
Oh I wasn't trying to say that all gentrification was caused by the bubble, just that the bubble fueled it.
Luxury condo towers in sketchy neighborhoods... we can all think of some. Gentrification is usually a process that takes a very long time. During the bubble it was accelerated greatly, so much so that you could almost watch it happen over a period of just a few years.
While this is of course anecdotal evidence, I know several young professionals, of European decent, that moved into DC in the last couple years. From my conversations with them I know that they were compromising on location to save money. Almost without exception they described weighing safety versus price and trying to find a balance they were comfortable with.
Without the skyrocketing prices of the housing bubble, and impossibly fast new construction of condos and lofts in DC, gentrification will slow.
Even if the urban revival proves to be part of a greater sustained trend, something I see no reason to doubt, there are still likely going to be some neighborhoods that remain unsafe.
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