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Monday, February 1, 2010
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105 comments:
Fairfax County demographic data 2008, median income(107k), home value($502k), etc. There is a difference between median home value and median sale price of course, since the lower priced houses turn over disproportionally(conjecture, no data).
You will also note that while median income is up 30% from 2000, the DC area Case Shiller index is up 77%. Which means the price/income ratio is up 23%. Of course, price is just the major component of housing costs, mortgage rates, tax rates, and repair costs all come into play as well.
Thanks Shamrock!
Here's a number from there that I found interesting:
Single Family Detached Units 191,262
Single Family Attached Units 98,573
Multifamily Units 101,865
Total Units 391,700
Price:
Single Family Detached Units $602,303
Single Family Attached Units $392,882
Multifamily Units $277,677
All Units $502,205
Only half of all housing units in FFX county are single family detached. There are more condos than there are townhouses. Our housing stock is clearly "wrong" with respect to what buyers want to live in. The existance of affordable condos is great and all, and better for the high density area that FFX County is, but people's expectations are clearly that it should be suburbia, where everyone gets a SFH. Thus the huge supply/demand imbalance that leads to a $200k! jump in price between the median attached and detached housing.
The demand is clearly for SFHs, and the supply isn't there. Which is also boosting the prices on the in-between solution of a townhouse.
These are the demographics of a housing ladder. Although I do have to say, that a lot of the 1960's era homes are serving the same purpose as the townhomes so that rung may not be as under populated as it would seem from the straight numbers.
lots of good stuff in there. The median may be $126k, but almost 40% make over $150k. I kept telling you guys that all my (former) competition makes more money than me.
Do you guys really believe that actual "values" (perhaps based, in part, by lagging assessments) trumps actual "prices"?
Median is median. Sale prices are sale prices. It all seems like spin to me.
Now the argument will be distortion based on predominately low end sales. "Affordability" will be discounted.
Median can clearly afford median. Perhaps it's not the "median" house of your dreams. Should median be able to buy more than median?
If median home prices are too high (or the houses not good enough), perhaps it's best to wait until one makes more than median or saves for a huge downpayment. Why should median, and when has median ever, be redefined as SFD with granite and stainless?
Shamrock,
You do realize that 2000 CS numbers were the approximate same as 1985? You do know the 90's were flat for the most part?
Has there been no change in this region since 1985 that would justify an increase? No population or job base change? No lack of buildable land? No change in demographics? No Dulles Corridor? No metro stations? No Tech and Defense boom in our area?
You aren't in Kansas (Detroit) anymore.
Va_investor,
Let me clarify my takeaway from shamrock's link, because I think that once again you and I are actually in agreement.
40% of families make over $150k. 48% of homes are SFHs. So, only another 8% of families in the county making less than $150k, but probably over $120k (given that 22.8% make between 100 and 149k) "qualifies" them to compete in the SFH market.
So, taking $150k X 4 and getting the median SFH home value of $600k doesn't seem like it's out of whack at all. For today's rates 4 is a reasonable multiplier even if you've only saved up 20% (or transfered that much in paid down + appreciation equity). The WaPo calculator doesn't do this exact calculation, but $150k income plus $120k savings qualifies you for a $666k home at 5% interest rates and 28% DTI. So, a multiplier of 4 is conservative with a hefty downpayment and today's rates. Sure, they only qualify for a loan of $546k, but still, this was the lower bound that 83% of the SFH buyers exceed.
Now, the major quibble should be that it's not just SFHs that are desirable, such that a goodly chunk of that 40% will be buying luxury townhomes or condos. So, call it 70% of SFH buyers can readily afford today's median SFH value. Still sounds reasonable to me.
My earlier comment was pointing out that the housing stock does not match the wants of my sense of the zeitgeist on the blog. Thus creating the situation where only say 20% of the SFH buyers are going to make less than $150k.
(all comments are clearly FFX county specific, as no demographic data was presented for other counties which probably have their own peculiar dynamics)
Visited this open house yesterday in Arlington:
http://franklymls.com/AR7248499
Place was mobbed. Realtor (who I know) said over 150 people had visited and he had run out of literature.
Obama's budget - which I see as the absolute minimum the USG will spend - looks huge to me. Lots of tax increases and little spending cuts. Looks like we're right on course for enormous increases in Federal spending to keep our local economy humming.
TBW, when I move the goal posts then you can say I moved the goal posts. Until then why don't you refrain to what I actually post.
Tom,
Wish one could tell what was done between the $650 2008 sale and now. It's still "window unit" cooling, but they smartly removed it for the picture they took last spring/summer. Impossible to say whether even the new windows are pre or post the old sale. Certainly paint and possibly new flooring in the basement. Looked like fake formica "granite" from the picture (which is probably new, but hardly an "update").
It will be interesting to see what the mobs of interest translates into in terms of sale price. But I'm too lazy to look up comps to see how well it's priced.
Barney Frank Says the Poor Should Rent Not Own (The Atlantic)
Frank: I think the answer is you separate out the function of providing the equity in general for the mortgage market and doing some subsidy and in my judgment, the subsidy again, as I said before, should be focused on affordable rental housing, not in pushing low income people into owning homes that they can't afford.
Too bad this is not yet government policy.
Under part of the program in Prince George's, first-time home buyers can receive up to $20,000 through a no-interest deferred-payment loan to help purchase a vacant foreclosed property in the county. If the buyer stays in the home for 10 years, the loan is forgiven. If he or she moves out before then, part of the money must be repaid.
The County Council voted Tuesday to raise the down payment cap to $60,000 for lower-income residents. Many can't afford to buy a house in Prince George's with $20,000 in assistance, said Rosalyn B. Clemens, who manages the county's stabilization program.
"People at this income level, without a deeper subsidy, just will not be able to afford to buy homes," Clemens told the council.
Article
"I think grocery store workers (particularly Giant and Safeway where they are unionized) used to be well paid. Not anymore. I think this is because food costs have not budged much over the past 20 years and there is intense competition with companies like Wal-Mart, Target, Costco, etc.
Whole Foods (IMHO) is the worst in that it often pays employees LESS than regular grocery stores like Giant, Safeway, Shoppers, Harris Teeter despite charging 2-4x for the food!"
You are incorrect about food costs not budging much. I am an extremely avid couponer so price is very important to me. I get most of my groceries, personal care products, etc for free (doing much better with coupons here than when we were in MI actually). I spend less than $100/month on everything, including the newspapers for coupons. Some months I don't even have to shop (didn't have to shop in Nov, Dec, beginning of Jan at ALL).
The reason I point out the couponing is because I do notice when "new packaging" comes out. The manufacturer claims that it is better for the environment, so they make the Tide bottles smaller, or whatever. Then look at the ounces, they are slowly decreasing, and load amount as well. so, let's say used to be 16 ounces, is now 15.75, etc. That means that prices ARE increasing. Lately, over the last five years prices have increased a lot actually. But I digress...
The question still stands, where do these people (grocery store/fast food/target) live?
Cara,
A lot of great data. Thanks.
But keep in mind age. This says the median age in Fairfax County is ~40. So a lot of the people you are analyzing bought a house 7-15 years ago when they made a lot less.
sehrwunderbar,
I did not mean to imply food costs had not budged at all. Food has gone up in price. But as compared to other consumer goods it has not gone up anywhere near as much. We've posted in the past how Americans spend their budget and the amount that goes toward food and clothes has not changed dramatically as it has for say housing and health care.
Va_Investor said
You do realize that 2000 CS numbers were the approximate same as 1985? You do know the 90's were flat for the most part?
Harriet's table only goes back to 1987 but still shows this is wrong.
Jan 1987 64.11
Jan 2000 100
Not even close.
Now it is true that prices were mostly flat during the 90s (after a bust in the early 90s). I'm not sure why you keep pushing the falsehood that it was flat from 1985 when it was more like flat from 1993-97.
tbw,
How or whether the age distribution effects this calculation needs more thought than that.
1) People do move. Whether for jobs or trading up. So you'd need to compare the median age of a SFH buyer (which I'm pretty sure we don't have numbers on) to the median age of residents to make the argument you're making. 40 actually is comfortingly close to my expectations for the age one would be if one used the housing ladder to buy a SFH.
2) This is a survey of all homes in existance, not homes for sale. Thus the fact that in aggragate this says that current owners could actually afford to buy their home at today's prices is exactly the opposite of what we used to assume 1-3 years ago on this blog. We assumed that the vast majority of current owners just got in under the wire and couldn't support today's prices if they had to.
3) All these numbers really tell you is if current owners could support today's prices if they had to. That's of course, counter-factual to what actually is required. At 391,000 dwelling units but 4000 for sale in any given month, that's only roughly 1% per month, 10% per year of the housing stock that is actually changing hands. So without the renter/owner/likely buyer/likely seller breakdown of all these demographics you are unlikely to be able to pull out the price direction.
All you can get is the sanity check. There are a smaller percentage of SFHs in this region than people on this blog seem to want there to be. But area incomes do generally support mortgages of today's market values at today's interest rates.
This looks like a good graph for housing prices adjusted by inflation. It is a little old (only goes to maybe beginning of 2009).
http://mysite.verizon.net/vzeqrguz/housingbubble/
Cara,
Keep in mind that some of the multifamily units are apartment buildings. If you just look at non-rentals the SFH number would go up.
The median age for SFH buyers is definitely not 40. Maybe in McMansion neighborhoods (or even higher there). But in a modest SFH neighborhood you will not see a median age like that at the open house.
sehrwunderbar
I am surprised the local housing experts could not tell you where the local retail employees live. I have 65 employees and without exception they rent or live with their family members.
The average wage at the supermarket, retail restaurants etc is not above $11 in this area and your lucky to get 30 hours at that rate. The economic climate (yes even here in recession proof NOVA) over the last two years has allowed me to drop wages at least $2 dollars per hour.
The majority of the people in the positions you asked about will be lifetime renters without a change in occupation.
I have been reading this blog long before Harriet got her place. What a strange post to get me to relinquish my lurker status.
Here is a riddle. Look at page 18 of this Arlington demographic presentation.
For straight married couples it says the average male income is $86,126 and average female income is $41,937. However, the median HH income is $166,151. But $86,126 + $41,937 is $128,063.
The disconnect is even larger with male same-sex couples. Average gay male income is $66,082 but median HH income for male same-sex couples is $163,478. But $66,082 x 2 is $132,164.
The only explanation I can think of is that earnings is just wage income and median HH income includes a lot of other things.
Which makes me think median HH income is a pretty wide barometer of earnings. And the 2x-4x income to price ratio I think was just based on wages.
So I think that's one reason we scratch our heads when we look at the median HH income numbers. There are a lot of people with substantial interest, capital gains, dividends, etc earnings here. However, I don't think the median first time homebuyer has substantial assets in that regard.
tbw,
To get apples to apples you need the median age for the entire range of SFH housing stock, not just entry level if you're going to compare it to the $600k median SFH value.
We simply don't have that number. Without it we're just speculating, and while my instincts are usually wrong, if you haven't noticed I refuse to trust any one else's instincts until they can back them up with stats.
With people moving in and out of the area, and retirees wanting single level dwellings, I don't think 40 is implausible.
Your entire scenario seems like it's predicated on the idea that there is no ladder, that buyers stay put for 20-40 years. Hence the comment that 40 year olds bought 7 to 10 years ago, and that the median SFH buyer is younger than the median person. But if the ladder exists then these assumptions break down.
As for the apartments being rented not bought, this doesn't necesarily change anything. How, how does this impact which segment of the income earners have access to the houses that are for sale?
Or are you just pointing out that, due to our high prices we need a lot more rentals, and thus that the housing stock make-up may not be as far off as it seems. If that's your point, I can see that. Of course it just reflects the other main complaint on the blog, that we all have to rent for a larger portion of our lives than we would like to in a perfect world.
Cara,
I think many here just feel like they are renting longer than most do because during the bubble it seemed like every 25 year old had their own condo. In reality, even NAR and NAHB will tell you the median first time homebuyer is 31 (and I think that's inching back up post-bubble).
Your entire scenario seems like it's predicated on the idea that there is no ladder, that buyers stay put for 20-40 years. Hence the comment that 40 year olds bought 7 to 10 years ago, and that the median SFH buyer is younger than the median person. But if the ladder exists then these assumptions break down.
The median SFH buyer is younger than the median person *in Fairfax County*. In Arlington and DC it's the opposite. Arlington's median age appears to be 34. Add in the fact that almost all SFH homes in Arlington are move-up home cost I would expect median homebuyer age to be above 34.
I am not saying there is no one who buys a TH, lives there for seven years, and then buys a SFH. I'm just saying many people do not do that.
One way people avoid the ladder is driving until you qualify. I know we've agreed on that before. Yes some people ladder when they cannot fathom living any further west. But Loudoun and PWC would not have been so popular (Loudoun was the second fastest growing county in the nation for many years) if there were not a substantial number of people who refuse to compromise on a certain standard of living.
And I've never argued just anyone can get a nice SFH in nice parts of Fairfax County. It is expensive and people better have a good income. But they don't need $150k.
Cara,
I also suspect there is a substantial percentage of people who come here for college and stay or come after college but do not buy here. They eventually leave because they cannot afford a middle class lifestyle here. This was true pre-bubble (although exacerbated by the bubble.)
I don't think you necessarily meant it this way but I feel like your comments imply wanting a SFH is a mortal sin. It's a common desire for most Americans.
There are a lot of immigrants in this area who are happy with a TH or condo. And there are, let's face it, some poor people here too who are native-born. They are content with a TH or condo. (Yes there are some fancy TH communities with TH bigger than many houses for which these observations do not apply. And this is about condos/TH in suburbs and not in Arlington or DC.)
But I cannot tell you how many friends I have who are not sure if they can live here long term. They are making decent salaries ~$60k-70k and are just not impressed with what that provides. I don't think they are being uppity in expecting a home when their relatives in PA, OH, IN, etc have SFH on a smaller salary.
tbw,
Yes, there are ways to avoid the ladder entirely without saving up a full year's gross income to do it. Yes, the ladders in the region overlap and interact. All true...
I'm still totally fuzzy on how you reach the conclusion at the end of this paragraph:
"And I've never argued just anyone can get a nice SFH in nice parts of Fairfax County. It is expensive and people better have a good income. But they don't need $150k."
You could mean so many different things.
1) There are nice homes for under half a million dollars in nice areas. It may be blasphemy, but it's true. Just because the median may be $600k doesn't mean there aren't nice homes in nice areas for $400-$500k. And it may be even wider than that, that's just what I know from near me.
But I really don't think that's what you meant.
@ tbw 11:01: I believe that "household income" is a measure of all of the wages of people living at one residence, so in Arlington if you have 4 guys sharing a house each making $50,000 their "household income" is $200,000. So it's a flawed measure in urban areas where this type of arrangement is commonplace. "Family income" is a better measure as it accounts for the income of a family unit (single person or couple).
Thanks Finnwar. Even $10/hr for basically min wage is WAY higher than I am used to, but as I've said before housing prices are WAY higher than I am used to.
TBW,
What exactly does this mean:
"It is expensive and people better have a good income. But they don't need $150k."
How much do people need then?
tbw,
There's no mortal sin about it. Just strong housing stock forces working against them. For more people to be able to afford SFHs, this area would need a higher percentage of SFHs to help lower the cost of all of them. If 75% of the housing stock were SFHs, then presumably they'd be priced such that 75% of households could afford one.
Cara,
There are middle class homes now in the upper $300s. When this is all done I expect many middle class homes in the lower $300s, maybe even high $200s.
I think the median first time homebuyer in Fairfax County makes about $80k when you account for them being about 30-32. I think many are not buying right now because the market is out of whack.
I think we are just going in circles here and this is not going to be productive unless we can find what early 30s people make in Fairfax County.
sehrwunderbar,
I'm guessing around $80k. But that's when the bust is over. We still have not seen prices fully correct.
Cara,
If you assume 80% of the multifamily units are rentals and 20% are condos (I think a generous condo assumption) then SFH are 62% of the housing stock in Fairfax County. I'd also venture that 40% of TH are McTownhouses (with 2,000+ sq ft) which gets you to 74%.
So I think the housing stock is middle class friendly. :) Just not the bubble prices.
tbw,
And then we'll go around in even more circles if we can't pin down how many wage earners are in that buying household, and what percentage of their total income they will chose to put towards housing. Will it be 28% of the lower of two incomes? 28% of the total? Presumably somewhere in between, and then you need to factor in what percentage of SFH buyers in their 30's are single, and what percentage of their income single people will chose to put on the line....
In other words, $80k household and 28% DTI gets you to about a $278k mortgage right now, 33% $327k, 36% $356k. And that's just the mortgage with PITI. So your numbers can be reached by one person with zero savings.
Hence it seems like a lower bound, not a realistic market prediction to me. Add on the 2-3 years most people save (reported the other day, I can't recall the exact number) and that most will begrudgingly assign either a higher percentage of their lone income or dig into their spouses income a little bit in the short term, and all those numbers get adjusted up by $50k-$80k and oddly enough match the numbers we have now in some neighborhoods.
tbw,
If you're comparing incomes of all households, both renters and owners, then you need the total housing stock, not just owner-occupied.
I don't understand why you can't do an apples to apples comparison today. You can take the rentals out of the housing stock to get the owner-occ stock, but then you also need to take the renters who aren't buying soon out of the income demographics...
Va_Investor said
"You do realize that 2000 CS numbers were the approximate same as 1985? You do know the 90's were flat for the most part?
Has there been no change in this region since 1985 that would justify an increase?"
Without pulling the CS numbers, I know this is in fact not true. The period of stagnation in the CS numbers was at most just a couple of years. For you to say they were the same in 2000 as they were in 1985 is ludicrous.
I have a question about DTI ratios and PITI.
Do these calculations also include the costs associated with health insurance (pre tax), retirement planning (401k contributions etc.), college planning (4 Jaime Jr. in my case), daycare expenses etc..? How can somebody actually service their mortgage without dropping one of more of these other things that are also part of the American dream?
I make more than the average income for this area, but really struggle to see how I can buy a home on my income alone without forgoing any of the above. I don't live an extravagant lifestyle either. Do others find this to be a challenge?
The housing ladder works. It's how I was able to buy my SFH in N. Arlington. I started out with a condo in Courthouse; moved up to a TH near Rosslyn; and then was able to purchase my SFH.
All within Arlington!
Jaime,
My answer to you is the majority of those who are buying are already home owners who hit a 'housing lottery' in the last decade. Some spent their fortune foolishly but most are still swimming in equity that will help moving up/around tremendously when the time comes.
'First-time' buyers are a rare find in this area. It's even rare-er (is that a word?) to have bought with pure savings and no help from parents/military loans/FHA loans etc.
For me, I've past that phase trying to justify housing prices. I just want to buy the cheapest yet livable home I can find and be done with it.
Jaime,
You have to set your own budget and go with that, not the DTI of the mortgage lender. If you don't have 28% of gross left over after all other expenses and savings then don't set 28% as your limit.
Most calculators let you put in additional expenses if you want to.
You can also just gauge off of how you're faring with your current rent. If that amount is do-able, but more would be onerous, stick to that for PITI and figure the tax deduction will approximately cancel higher utility costs and maintanence.
But in answer to your question, yes. 28% would be too onerous for me and my husband to keep doing all the things you listed. So we went with 33% of my income, or 16% of our total. If we lose a job, things would have to get cut, but it would still be do-able.
Tom said...
"The housing ladder works."
Tell that to all the people that bought their condo/entry level townhouse in 2004-7. Many of them are so far underwater they won't be able to move up to the next rung on that housing ladder for a decade or more.
The housing ladder only works when home prices are increasing faster than inflation. Otherwise you are losing money and would have more savings if you put your money in an ING account while renting then you will ever have equity in your home.
Congratulations on your lucky timing of your entry to the Arlington housing market. Aren't you happy you didn't buy that first condo in 2007?
"oddly enough match the numbers we have now in some neighborhoods."
Yeah, the ghetto neighborhoods. I am from the Gary, IN area and let me tell you, there are houses here that are what I would even cal ghetto going for $300k.
When we first moved here I would take the bus to Ballston and would pass an area that looked to be pretty poor and saw what appeared to me to be the low-income apt. The people looked it, the buildings looked it, etc.
I start looking at real estate in the area, come to find out that these are $300k condos?!? I about freaked out at that!
Also, when calculating just how much the median income earner can afford, I don't think you are accounting the extra things as has been recently mentioned. If I were to get a job that made $40k/year I calculated the taxes, transportation cost for bus and metro and turns out I would only be making 25% of that since we are at the cusp of the next income bracket already. It actually makes more sense for me to be at home cleaning, cooking etc so we aren't spending money on those thing than to work 40+ hours a week to make nothing. We don't even have children, daycare would prob eat more than the other 25% left in that extra income.
I just don't understand why people are so willing to pay these outrageous prices in the area.
Serhwundebar: Finnwar answered your question about wages for grocery store and retail service workers. Where they often live is in rentals, particularly the multi-family places in Fairfax Co. Manassas, Loudoun Co. and PG County. Remember that the Wilson Bridge makes it easy for people from PG to commute into Virginia and housing of all kinds is cheaper in PG than in closer in areas of Northern Virginia. I tutor at an elementary school in Vienna with a lot of low-income children. Most of them live in rental townhouses, houses and condos or apartments. But not just one household lives in the rental. Most of them have at least two families per rental. We have a few children who actually live outside the school area, but go to the school because they spend part of their time with a grandparent, aunt, uncle, non-custodial parent who rent in the school district. Figuring out who lives where, ages, income, etc. is like herding cats. The published numbers tell one side of the story but don't agree with the reality of the situation. It became worse after so many poor people who were talked into buying houses lost them through short sales. Even with owning a house, many of the people did not live alone but divided up basements into rooms where single male construction workers could rent and contribute to the money needed to pay the mortgage. When the construction jobs dried up, a source of income to pay the mortgages ended. Also, TBW, keep an eye on Arlington. The new superintendent has told school teachers that they can no longer send their children to any school in Arlington. Many lower paid teachers lived in less desirable school districts because their children did not have to go to the neighborhood school. This will have a slight effect on Arlngton's housing market because there aren't so many teachers relative to the entire population of people with school age children. But it is another example of how lower-paid people make do.
Also, it seems to me that some are not accounting for the fact that, for example a $300k home at 5% interest for 30 years has you paying $450k interest. You are inevitably paying more than double the cost of the house. That also sends me for a loop. I understand the monthly payment is lower, but that's $750k for a $300k home (that, imo, in this area is already overpriced).
do people account for this as well?
Median is median. Not sure I comprendo, no matter what data series you use you get the same median? Sounds like your calculator is broken.
You do realize that 2000 CS numbers were the approximate same as 1985? You've already been beaten silly over that patently false assertion.
You do know the 90's were flat for the most part?
I wonder if it's just coincidence that the 90's was a great decade economically, while the 2000's with sky high home prices was a disaster? People's income rose but housing expenses did not, leaving more money for the rest of the economy to prosper.
sehrwunderbar,
Burke and Springfield are not the ghetto and they have middle class houses in the $375-$450k range, which is $40-$80k above what tbw was calling for.
You can justify your life choices however you chose to, but don't claim those are universally applicable to all couples.
I thought you just finished a law degree? Why would you be starting out at a $40k/year salary? And how does having jobs preclude a couple from balancing housework and cooking?
Yes, the 30-year mortgage is a bill of goods the American public has been sold. If you look back at the ownership rates prior to its invention, you'll see it's also the only mechanism that can allow most people to own.
No, generally, people don't look at the total interest until they actually have it printed in front of them on the mortgage docs. And then they immediately forget it and re-focus on the monthly payment. Because you spend money either way, rent for your dwelling, or rent on the money you borrowed. Take your pick. If renting the dwelling is significantly cheaper, then buying is a bad deal.
sehrwunderbar said...
Also, it seems to me that some are not accounting for the fact that, for example a $300k home at 5% interest for 30 years has you paying $450k interest. You are inevitably paying more than double the cost of the house.
...
do people account for this as well?
sehrwunderbar, if you're going to count the money people are paying toward the loan in 20-30 years you need to take inflation into account. That money is worth less in 30 years as food/health care/everything else costs more. That is why the bank wants an interest rate that is greater than inflation. You can always pay the loan down quicker (with more valuable "today dollars) if you don't want to end up paying as much in interest in the long run.
sehrwunderbar,
Although, if you're studying diligently for your bar exams (potentially in multiple states) then I would definitely agree that not working now could be to your long term wealth benefit.
(although I don't actually know anyone who wasn't working while studying for the bar).
I disagree about Springfield not being ghetto... Burke is very nice if you can stand the commute to your job from there. It isn't a place that anyone considering Arlington would want to live though, not urban at all and your shopping/dinner choices involve driving to the ghetto Springfield Mall area or a little farther to the much nicer Fair Oaks area.
I rented in Arlington and then Burke and much preferred Burke for the parks, clean air, and lack of weekend traffic.
sehrwunderbar,
5% interest on 300k for 30 years AMORTIZING loan won't be 450k, much less than that.
working for 40k a year after graduating from a law school sounds like fun. probably a little bit more fun, than staying at home with no kids and working on coupons.
Jeremy
That depends very strongly on where in Springfield. The bulk of Springfield is actually just like Burke but with older housing stock.
For most of Springfield, Fairfax Station and Burke, you wouldn't know which one you were in unless you looked up the school boundaries or had lived there a very long time.
There are bad parts of Springfield, the houses there also don't start at $375k.
I also don't believe in these whole meaningless boundaries that have no basis in local government. Falls Church is a place, Fairfax City is a place, Burke and Springfield are nebulous clouds of cachet or lack thereof like most of Fairfax County.
Jeremy,
And you obviously didn't sufficiently familiarize yourself with the local restaurants... There's no food other than the food court at Springfield Mall.
1) there's Kingstowne Village Centre, which is not Springfield and not a ghetto. And the new Thai and Indian places there are both excellent, better than I've had recently in Old Town or the Adams Morgan/Zoo/Cleveland Park area.
2) The best fish I've had at sushi is in a strip mall where the Kingstowne Library is.
3) Afghan Kabob in West Springfield? Very very tasty, although an afghani taxi driver told my mom that there's a better one in Falls Church.
Where there's a few good local restaurants there must be more.
I don't shop. So that's not a concern for me. How do you think we saved so much money?
Ok,
I was looking at a 10 city CS composite chart from 1988 to 2000 and misread it.
Now, can you all relax and explain why median can't afford median or why median isn't really median or why median has to be able to afford median SFH?
Median means half the housing is priced below that point. Median means half the population makes more.
All of the sudden "median" is a moving target. Some now claim that median home price = median home value???? What????
Reecon, thanks for the info. That's just as I suspected and is sad. At least in Gary people can live in a home with one family per home or grandparents and one family.
Cara,
you said "Burke and Springfield are not the ghetto and they have middle class houses in the $375-$450k range, which is $40-$80k above what tbw was calling for.
You can justify your life choices however you chose to, but don't claim those are universally applicable to all couples.
"
I was speaking of Arlington. The more I read here, seems as though Burke and Springfield might be what we are looking for anyways. Thanks for the tip.
Also, what was that second paragraph supposed to mean? Are you not aware of the average starting salary for an attorney? $40k/year is actually higher... Also, the legal market has taken a huge downturn as of late, many larger firms in the area are and have been laying off people that have been working for 30+ years. Obviously, those people are going to get any jobs that DO open up. I am not complaining because I don't want a job that I would be married to, I'm married to my husband. I'm just saying that people just graduating law school are having a hard time finding jobs in the legal field that are more than $40k/year let alone finding a job at all...
I never said that being a stay at home mom is universally applicable to all couples, maybe you are trying to justify your own choices? I don't justify my choices, I make them.
Cara, I am not diligently studying for the bar. I am not going to be taking a bar.
Konstantin, coupons are actually a lot of fun. When I can go into a store, get a cartload of groceries and walk out actually getting paid by the store there is a certain fun to it. I really enjoy the feeling of doing all the math and ending up with a great deal. I also like the look on other shoppers' and cashiers' faces when I get rung up at $100 and end up paying $0.16, it's awesome. I guess there is a sort of "high" to couponing, and I hardly have to work 40 hours a week at it. Just thought I'd throw that out then in case some might not have tried coupons before, they are AWESOME!
Also, how is interest on a home calulated then? I thought I=PRT, is it different for a home?
I have been basing my monthly amount to a mortgage on finding I, then adding to P and dividing to find out how much per month that is, is that wrong?
Also, thanks everyone for all the help on this blog. It's a great blog!
sehrwunderbar,
You said "Are you not aware of the average starting salary for an attorney? $40k/year is actually higher"
Do you have any stats to back this assertion up?
According the Bureau of Labor Statistics, the annual mean wage for an attorney in the DC metropolitan area is $145,040.
http://www.bls.gov/oes/current/oes231011.htm
Also, why would anyone spend the time, effort and money to go to Law school if they want to be a SAHW?
Last time I checked, clipping coupons did not require a law degree.
sehrwunderbar, surely you can't be implying that it is hard to find a job. We are all under good authority here from Robert's many job posts that the only people losing their jobs are the uneducated construction worker types. High paying jobs abound for the supermajority here with college degrees.
Cara, I knew you'd get riled up about my Springfield comment. Fact is Springfield is more built up than Burke, and has more cheap homes built closer together causing it to feel more "ghetto." Kingstowne is nicer as you mention, but it also isn't Springfield. The nicer areas of Springfield that are left are on the outskirts either on the way to Burke or on the way to Kingstowne. The urban area where the mall and other restaurants (not the mall food court) that are in Springfield (not Kingstowne) are, are ghetto. Try to go out to dinner on a Friday night and Springfield and report on what you see while waiting an hour for a table at TGI Fridays before you tell me it's not ghetto in Springfield.
"I just don't understand why people are so willing to pay these outrageous prices in the area."
Supply and demand, baby, at least for N. Arlington. You might as well ask why people are willing to pay outrageous prices in Manhattan: it's due to supply and demand.
Alright lets use median SALES prices (from MRIS), and median household income.
YEAR SALE INC RATIO
2000 209k 81k 2.5
2003 315k 81k 3.9
2006 470k 100k 4.7
2008 371k 107k 3.5
Still a long way to go to reach year 2000 levels.
I think most people do not work while studying for their first bar. What I had (and most of my classmates had) was a little excessive -- most of the summer. But you certainly need a 3-4 week period to really study. Of course, it's a bit silly that three years of law school does not prepare you to ace the bar exam upon graduation but such is life.
On a side note, I'm just going to whine a little that reecon was able to mock DC's city services (ambulance) yesterday and now sehrwunderbar and Jeremy are calling parts of Arlington and Fairfax ghetto and no one is complaining. Whereas when I make the slightest peep that a school like Woodson or Langley is nicer than TC Williams or Mount Vernon I have to deal with 20 angry comments from HayfieldGrad and sometimes others.
recent solds in N Arl with 'paper losses':
1/29/2010 @ $700,000; 3/11/2008 @ $807,000
1/29/2010 @ $779,300; 5/28/2008 @ $823,000
1/8/2010 @ $799,900; 11/26/2007 @ $817,000
1/8/2010 @ $480,500; 8/11/2004 @ $477,500
recent solds in N Arl with big price drops:
1/29/2010 @ $569,000; 6/25/2009 @ $650,000
1/29/2010 @ $1,282,000; 1/15/2009 @ $1,499,000
1/28/2010 @ $1,175,000; 4/9/2009 @ $1,800,000
1/22/2010 @ $674,000; 10/22/2009 @ $769,000
1/15/2010 @ $1,120,000; 9/12/2008 @ $1,498,000
a fun market to watch, not to buy, because, seriously, $569,000 for this?
sehrwunderbar,
What I meant by the second paragraph is that you were using your own choices to try to understand the prices in the region. Thus, universalizing those choices. Since they aren't the choices everyone makes, that won't give you the real market answer for what prices will be, and won't necessarily be right for what prices "should" be once the bubble has fully deflated one way or another in real inflation adjusted terms.
Your fuller explanation with regards to the job market makes more sense. I'm still not all clear on the logic or evolution of your choices, but it's not my business.
If Arlington is too expensive, and won't allow you and your husband to make the choices you want, then you may need to look elsewhere. Switching churches can be wrenching, especially when you've just started really making friends, but sometimes it's necessary to be able to balance the rest of your life the way you want to.
Jeremy,
Who eats at TGIFridays?
If you redfine Springfield to only be the commercially zoned parts, well, then almost no one lives there, because those aren't homes, they're businesses...
The only place I go to regularly there is Total Wine. Never had any "ooo scary" feelings there. Sure, day laborers deposit their checks at the BofA near the Silver Diner. Does that make the 5 mile radius around it a ghetto?
I repeat myself, the parts where houses start at $375k are nice suburban neighborhoods. I don't think we're in disagreement about this.
The areas of Springfield that you find scary are really really easy to avoid.
MM, clearly those people are using the housing ladder to move up in N. Arlington like Tom. Don't you see how well it has worked for them? They are already out of that home and on to the next rung!
MM, I totally agree with you, and I actually had looked at that home through various sources without actually going to it.
Sorry everyone, I didn't mean to sound like I was complaining that I could not get a job. I haven't been looking for a job at all. I have noticed that it seems really easy to find a job here, there are lots of help wanted signs up.
I have gotten job offers from various sources, but I didn't want to take them. As to why someone would go to law school and pay all that money to be a SAHM, don't forget there ARE scholarships and some people do just enjoy learning.
But once again, I was not implying that I could not find a job, I was just saying that at this point based on taxes, transportation costs, and time committment it does not seem like getting a job makes economic sense for me.
sehrwunderbar,
So in other words, the $40k number you threw out there was total BS?
Cara said...
"Who eats at TGIFridays?"
A lot more people than those who eat Afgan kabobs in West Springfield, as judged by the number/size of the restaurants and the wait at the door. Clearly "you were using your own [food] choices to try to understand the (palates) in the region"
tbw,
I'm complaining. Sehrwunderbar's was too non-specific to easily complain about.
Shamrock,
Hey, at least we're already doing better than 2003. Could be worse. Our price to income ratio is the best it's been in 7 years (other than last spring). Almost sounds like a RE advertisement. It would need more exclamation marks.
I am going to defend the so-called ghetto you guys like to call the Springfield Mall. Yes, most of the tenants have left the Springfield Mall over the last several years. JCPenney, Macy's Target, the DMV still remain and these are likely the tenants drawing most of the business to the mall today. Also, I would point out there are strip malls across the street from the Mall that have stores such as Best Buy, Home Depot, Border's, Old Navy, etc. that don't seem to have any problems. There is also a Bertucci's and a TGI Friday's that don't seem to have a problem. I wouldn't call the Springfield Mall area a ghetto considering that the nearest apartment building, right across the street, is as nice apartment building as many in Kingstowne. Just because we don't have 5-star restaurants nor some swanky stores like Tysons doesn't make us the ghetto.
Also, I think you guys have been exaggerating the crime rate in the Springfield Mall area. The crime rate, yes, is probably higher than other parts of Fairfax County, but people are not getting robbed, murdered, and carjacked there on a regular basis like some of you are implying. The woman that was abducted from the Mall and killed was abducted by young men from PWC not Springfield.
Numerous people were getting car-jacked in broad daylight just a few blocks behind Capitol Hill very recently. The Springfield Mall area has never had that kind of crime spree so why does it get labeled the ghetto and not Capitol Hill? Oh, that's right rich White people live around Captiol Hill, but Springfield is not full of rich White people so it is a ghetto.
Well, as far as average starting salaries for a lawyer. Part of that is what career counseling said during various events they held for 3Ls on the job market situation when we were going to graduate.
I looked at payscale.com after you wanted back up information, they have listed that average salary for 1 year experience or less is $45kish starting out. I don't necessarily know what it is here, because I did not intend on getting a job here. That's just what career counseling said, and I remember random things like that.
Sorry if I'm a little snarky in my postings today. A sick day from work gives you lots of boredom time to post and a wonderful disposition when doing so.
Cara, housebuyer, et al.
remember that house you all helped me do comp analysis on? just dropped $50K. which means it's now dangerously close to becoming attractive.
i guess it's now or never! i may cry when it goes UC.
MM,
awesome finds. That's a lot of 1 year owners... with a lot of losses.
Very interesting, but I can't tell what to make of it. Are prices really down that much since 2009? Or is distress motivating new owners to sell under market? What does this level of motivated sellers indicate about the health of the 2008/2009 sales in general?
You don't want to read too much in, and yet those are so dramatic...
Shamrock,
Thanks for the numbers. I, too, thought there was a long way to fall. I decided recently, however, that the 2000 numbers were attractive only because home prices had stayed relatively constant for years and years up to that point; wages went up during the same period. I'm not willing to wait years and years. We put an offer on a place last week and should hear back by tomorrow (negotiated short sale).
Jewel said...
sehrwunderbar,
So in other words, the $40k number you threw out there was total BS?
No, I said that if I were to get a $40k/year job that 75% would go to taxes and transportation costs because we are at the cusp of the next tax bracket. That number is not BS. A few weeks ago I was thinking how much would I really be making it I had a $40k/year job after taxes and trans. costs. I calculated it and that's what I came up with, I was actually pretty shocked because I didn't think it'd be that low to only "really" be making 25% of that salary. We are better off with him at work and me at home, that's all. The number was not BS.
The $45k/year for lawyer starting off is not bs, btw, as I previously stated that was what career counseling told everyone. They said that people expect higher jobs when starting off but wanting everyone to know the reality, especially with legal job market declining recently in the US.
BTW, $40k was Capitol Hill salary because that is what I would have gotten if I was looking for a job.
Jeremy,
That was funny.
But my recommendations for good restaurants in the area were real. There are really good restaurants, and they're not even mildly scary.
The only people I know who eat at TGIFridays are teenagers because it's cheap enough to take a date to, without it being fast-food or Denny's. So, if teenagers scare you, then by all means, avoid TGIFridays.
I avoid that Old Navy mall because it doesn't have enough parking, not because it's dangerous.
HayfieldGrad,
You really do not interact much with the suburbanites you hate so much. They don't like Capitol Hill either. They would all live in Springfield before Capitol Hill hands down. Are you joking with this?
Cara,
I have the opposite reaction. Teenagers and young adults will be going to nicer restaurants because they want to impress their dates.
Parents with kids paying for 4-6 mouths don't need to impress anyone. They'll be going to TGI Fridays.
Your taste in restaurants might change when your husband and you have kids.
sehrwunderbar,
You said "The $45k/year for lawyer starting off is not bs."
You're still not showing any proof.
I did:
http://www.bls.gov/oes/current/oes231011.htm
Like I said before - mean wage for this area is $145k... a far cry from your number.
Springfield Mall has problems that Tysons Corner Center and Fair Oaks Mall do not. It's not even debatable.
However, it is clear that Kingstowne Centre is doing well. And the fact that it is basically next door to Springfield Mall shows that Springfield Mall is fixable.
I suspect redeveloping it along the lines that have been proposed would help. There also is a valid question of whether Northern Virginia is overmalled. It's not shocking to me some malls are not doing well. How many Macy's do you need in a 10 mile radius?
Include me in the TGI Friday's group as the demographic that goes there to eat out cheaply so we can continue to put half our paychecks into our down payment fund every month. Apparently we are a "rare-er" group than the others though.
I already backed myself up,Jewel, I said payscale.com (besides what career counseling said).
http://www.payscale.com/research/US/Job=Attorney_%2f_Lawyer/Salary
Roll over attorney/lawyer less than 1 year, that's the average starting salary, Starts at $45k as I previously said.
MM,
That second set of numbers appear to be merely price reductions, not losses.
I didn't click on the first group, but if those are real losses they don't seem like "blood in the streets".
Am I missing something on the second set? One had bought in 2005? One had owned since the 80's?
Is a price reduction a loss? Or, less of a gain?
sehrwunderbar,
On the very same page you just pointed me to, it says:
Lawyer Starting Salary chart shows that for a lawyer, average starting salary is around $57,000.
Now I better get back to work, afterall I have REAL job to do.
Jeremy,
Teenagers don't have money. After school jobs just don't make that much.
Neither Thai nor Indian nor Afghan kabob are significantly more expensive than TGIFridays.
We only eat out things we can't cook at home. Then again, as a kid my family never ate out unless we were on the road or visiting my grandparents. So the whole eating out with kids thing is a little strange to me. I know, everyone does it, so I assume we will too. It's just honestly, my mom worked, but eating out was only for very very special occasions, for which TGIFriday's wouldn't cut it.
Cara, I had the same experience as you. We never ate out, maybe once a month getting pop as well. I guess people eat out a lot more now than they used to, or it's just more affordable?
Jewel, if you roll over the less than 1 year experience it has attorneys starting out at $45ish. Simple as that, but anyways...
Va_Investor,
no, 2nd group were price drops.
not trying to prove blood in streets with 1st group either.
mere observation of recent solds with volatile prices. didn't mean to mislead or misinform.
nah, TGI friday's is cheap but it does not deliver any bang for the buck.
i can guess that if you do not have a deck/outside grill going to a cheap steakhouse is a reasonable option if you do not like your place smelly and still want a cheap steak. but i do not dig tgi's, too chainy.
at least food-wise this area has so many decent and cheap options, as aforementioned thai/levantine places. very reasonable thing to do couple of times a week, so the cooking at home does not become a chore, but remains some kind of an art.
Sehr, you have referred to being on the cusp of the next tax bracket more than once. If you're referring to income taxes, I don't understand what you mean. Tax rates go up with increasing marginal income; they do not increase taxes on the income below. So for example if your husband grossed 100k, the rate you pay on that 100k is unaffected by your earning 40k or zero. The rate on the 40k may be higher but only for that portion of hh income.
Cara,
Another wrinkle to the price-income ratio . . . not everyone who is rich spends money "like they are rich." I was reading this column which talks about the new book from Thomas Stanley (which appears to be pretty similar to his previous Millionaire Next Door book.)
-- In the United States, there are nearly three times as many millionaires living in homes with a market value of less than $300,000 than there are living in homes valued at $1 million or more.
Note he defines a millionaire without including the value of their real estate so he's talking about really wealthy people (since most millionaires get there primarily from their home equity.)
Re: starting salaries for attorneys - for someone going into legal aid/public defense, etc. 40K is probably not that far off the mark even in a high cost area like DC.
For private practice, its highly dependent upon firm size. New hires at any big firm around here will earn about 140K in their first year. Someone working as an associate for a solo could go in earning as little as 60-70K.
At our firm, first years are getting about 105K last I checked.
tbw,
Because I don't agree with you, I must hate suburbanites? I don't suburbanites are this mass of people that all share the same opinions that you seem to think we do.
You continue to say middle-class people will not send their children to NOVA schools that do not look like schools that can be found in suburbs in other parts of the country. Several of our high schools haven't resembled typical American suburban high schools for decades. This is NOVA, our suburbs are different than other suburban areas of the country.
HayfieldGrad,
As always, you stretch my comment into something that was not said. I did not say you hate all suburbanites. I said you hate all suburbanites who do not like what you like.
As for this schools in Northern Virginia do not look like schools in many other suburbs. I agree. I've pointed this out to you about 10,000 times. Langley, McLean, Woodson, TJHSST, Madison, Oakton, Herndon, Westfield, Lake Braddock, Robinson, etc etc etc are all way more diverse than the average school in America. That's why I just laugh and roll my eyes when you call them lily white rich schools.
I am confident that if you amassed the socioeconomic data for a school like say Lee HS or Mount Vernon or Annandale from 1980 to the present you would see a pretty clear pattern of middle class and upper class families leaving the schools. I've never alleged it happened overnight or is even done. I do suspect you'll see more middle class families at such schools in 1980, fewer in 1990, fewer in 2000, fewer in 2010, and presumably even fewer in 2020 if nothing changes this decade at those schools.
Cara said
Teenagers don't have money. After school jobs just don't make that much.
You do realize some of those teens you see eating out are paying partly or fully with money from mom and dad. Hope you budgeted for that. ;)
Your child will be at school until ~3 pm and if he/she does sports or activities even later. Add in all the homework they are bound to get and it does not leave much time for an after school job during the school year.
Also, good luck with them getting a retail job during the school year when their competition are adults who can work more flexible hours.
And if you somehow make it work you probably are just teaching them a personal responsibility lesson rather than having them contribute any real money once you take in the costs of a separate car for them, additional auto insurance costs, gas costs, etc.
According to H&R Block 2009 tax calculator:
Married filing jointly-
$100k taxes for 2009= $11900
$140k taxes for 2009= $21900
Net income for $100k= $88100
Net income for $140k= $118100
difference= $30000 added income
Transportation costs= about $2k ($6/day metro, $11/week bus pass for about 49 weeks/year)
Net becomes= $28k, so I guess it isn't as bad as I had thought. I think I was figuring total tax as percent of $40k, instead of just added tax (silly me).
http://www.hrblock.com/taxes/tax_tips_calculators/index.html#
@sehrwunderbar
Many will probably disagree with me and I don't know your circumstances, but I'll relate my experience since I work and my spouse is a stay-at-home spouse with 1.5 kids.
Plus, you seem like a kindred soul in your frustration at housing prices here :-).
I started working in '05 and thought housing prices were nuts. I still think housing prices are nuts, only nuts vs. stupidly nuts 5 years ago.
My goal for my family is to own outright a house sufficient for my needs; own it free and clear as quickly as possible. The question becomes can I do that more quickly renting or "buying". After running the numbers factoring (excel spreadsheet, etc) in buying transaction costs, maintenance, deductions, etc. I have found that I can currently do that a lot quicker while renting. Over the past 5 years I have saved at least 50% of my takehome each year. . . . I'm sure at some point the numbers will flip, and where I am currently looking they are almost there . . . but not yet.
I rent as cheaply has humanly possible and live way below my means. I live below my means now so that some day I will live above them. For 2 people if you can't find rent cheaper than 1200/month, you ain't looking hard enough, 'cuz I pay way less than that and it's not the ghetto.
So after 5 years, I can pay cash for a decent house w/ > 6 months living expenses in any where in the country except places like DC, Boston, NY, & Cali.
I have almost come to the conclusion that it is almost time for me to move out of this area. I've lived in many different places and DC IMO is not one of the better places, unless you like being in the "center of power", "capital of the world", etc. Sorry, this area isn't all that; I just want a place where I can raise my family in peace and affordability and many places in this country exist that fit that bill.
Incomes here are higher, but your standard of living is much lower. Does it really matter if you make 125k here but a decent house costs 400-500k, vs. 70k in another city but a decent house costs 150k? (yes, major cities exist where housing is only 2x income)
So unless you plan on staying here for a while buying may not make much sense, but it depends on the situation. It sounds like you are relatively young, so unless there is a something too good to pass up . . . I have moved almost every year since '05. While moving sucks, there is a lot to be said for the flexibility of renting especially when things are very transitory, it keeps things light and it's not very expensive to move, just a pain.
Some thoughts on other items:
In order to compensate for transaction costs, you must sell ~5.25% more than your original purchase. Selling @ what you purchased is losing money. Another thing most forget to mention/calculate on a 30 year mortgage is the interest is front-loaded. I.e. the time when it really benefits to make double payments to bring down the total interest you pay over the life-time of the loan is at the very beginning. Precisely the time that most cannot do so b/c they maxed out their monthly payment. After 15 years it doesn't make sense to pay it off quickly b/c you've already paid most of the interest.
A smart man once said a rich man does not pay interest he earns it.
I applaud your stay-at-home goals. Kids are truly the greatest thing. I wish more were willing/able to make the sacrifice to have a stay-at-home parent.
Anyways, good luck on the housing search. I hope you find something that works, but if not save as much as you can. And if you aren't making more here than you would elsewhere, why are you here?
We're making $5k more net income here than MI. I'm beginning to think it really is ridiculous to stay in this area, although his work is with the DoD, so that's why we're here.
We are currently living on less than 50% of his income and basically still do whatever we want. Just the housing costs are annoying, I don't want to pay that much.
How can you find rent so cheap? We are paying $1350/month on rent.
Sehrwunderbar My husband and I both went to good law schools but decided to work in the suburban offices rather than in the downtown offices of a good DC firm because we did not want to turn into the typical law firm drones. In my second year, I worked part time because I was pregnant with twins and had some medical issues. I earned nearly $70,000 that year while my third year husband earned $163,000 for full time. I have friends who work part time at the major DC firms who make well over $100K. My friends who quit my firm after having children and went to Justice, FTC, or another government agency are also earning over $100K for pretty much 8:30 to 5 jobs. Even if you went to a so/so law school but did well, you should be able to make more than $45K in this area. I have a friend who works part time at a small firm in Old Town just doing real estate settlements and she makes more than $45K a year. However, if you aren't pursuing work this is probably moot for you.
Thanks for the info waitingtoo. I'm not looking for a job, but I have friends that are still looking. I should let them know this area is ripe for jobs. Two in particular are currently in MD and NH applying everywhere and not finding anything yet.
sehrwunderbar,
I know this is a housing blog and not a career advise blog. Having said that, anyone who starts a career starts in an entry-level position which pays less than the average for that field. With time and work experience salary goes up to a point that you can live comfortably, own a home, etc, particularly if you are an attorney.
If today does not make economic sense for you to work, it will never will. If you wait, in time you will find yourself age 40 starting a career at the similar lower wages you could earn today, because you will still only qualify for an entry level attorney job. Short of winning the lottery, most people have to work and gain experience to earn the money that for you seems to make economic sense. It does not happen overnight.
Several people on this blog have wondered how your average grocery clerk manages to live in this area. Reecon hit it on the head. And I should know. I am a penny-pinching renter and many of them live beside me. One couple will rent a home (or apt or condo) and ten or more of their closest coworkers/friends/cousins move in. I not only live beside them, as a non-car-owner I share the bus with them. And hike along Route 1/Columbia Pike/Glebe Road with them. I am one of the people you see along with the Guatemalan grannies fleeing for dear life across the non-existent crosswalks before your oncoming SUV dispatches us to the Great Beyond sooner rather than later.
Jeremy, I agree with Cara - Kingstowne/Springfield has some surprisingly good places to eat (and rather cheaply too).
Sehrwunderbar - In addition to Springfield/Burke, check out Annandale. I suspect that you and I are more or less in the same price range ($450,000 to 350,000 leaning more to 350,000). Be sure to check out Fairfax. There are some very nice properties in safe neighborhoods with easy access to shopping etc. You just have to be careful about checking them out. Be sure to check them out online ( Franklymls.com and Walkscore.com) and be sure to visit the neighborhood several times at various times of day and night. Get out of your car and take the bus. Walk it. Talk to people you meet. You just don't get the same info by scooting around in your hermetically sealed car environment.
HayfieldGrad - And here I thought that the DMV was the major magnet for Springfield Mall. Judging by the lines, anyway.
sehrwunderbar,
If your husband makes 100k, then $1350/month is less than 20% of his gross income. That is a really small percentage of income to be spending on housing. I know apartments that are part of the affordable housing program in Fx County usually set the rent for a household at 30% of the household's income.
I never said Springfield didn't have good places to eat. I love TGI Fridays, and so does my wife. The 2 for $20 thing is a great deal and we like all the choices. All I said is that it was ghetto compared to the Fridays in Fair Oaks (or Tyson's for that matter). When I lived in Burke the wait was often over an hour, and the other people in line had serious "Pants on the ground" going on. The mall itself was sketchy on your way to the car after leaving the late movie - large groups of young adults just hanging out, and not waiting on their ride home. I'd bet my paycheck you could buy drugs there. The new theater in Fairfax Corner is much nicer anyway. The one in Kingstowne is nice too.
Maybe it has improved in the 3 years since I lived in Burke. I haven't been back to find out.
tbw,
If the teenagers have money from their parents, then I'd say by definition, it's probably not the ghetto....
I'll spare you all the personal tales of working in high school. But while I agree that after school activities are probably a better use of a high schooler's time than an after school job, there is this time of the year called summer. And there's driveways to shovel, and kids to babysit, and leaves that want raking, for the odd job here or there.
As to your assumptions about the car culture, well, let's just say there's more than one way to skin a cat.
But don't worry about us, we bought way under our means for a reason.
But as to your point about millionares in inexpensive houses, what I'm harking back to I think predates your time on the blog. A few years ago, everyone even the bulls, agreed that 80% or more of the homeowners in Arlington and Fairfax County, not only wouldnt' chose to pay bubble prices for their homes, but couldn't have if they wanted to. This had important implications as to the effect of HELOC abuse on the distress level of the area (for bears) or that no one would be selling at these prices (for bulls). So, this survey showing that in aggragate at least, homeowners probably could afford to buy their own houses again at today's prices (not bubble, admittedly), is a 180 degree turn around from our underlying assumptions of fragility in the system. Yes, those millionares don't get that way by overpaying for homes, but the fact that they could do so if the need arose provides a meaningful substrate of strength that will slow down declines, because fewer people will need to sell, or have the motivation to do so when their target house is still expensive anyway. It adds considerably to the stickiness.
Jewel: That's not starting salary, the is mean salary across all years of experience that is listed on that link you gave us.
On the other hand, I think that $45k is absurdly low.
NOVAWatcher,
I realize $145k is not the starting salary, I was just pointing out the fact that the vast majority of attorneys (even just starting out), make well over $45k/year.
I even made more than $45k my first year out of college with a lowly bachelor's degree years ago.
And besides, the payscale.com RANGE was $45k to $69k for attorneys with less than 1 year of experience, with $57k being the average.
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