Comments on Washington's economic future depends on more housing - Greater Greater Washington

Comment by GURLEY

Sat, 20 Oct 2012 21:10:18 EDT

Too many X factors are working against future growth to justify increase housing in the District.

1.The Bush Tax CUTS for the Rich; will automatically kick-in unless Congress act.
2.Federal Government must scale back office space and leasing and rental agreements.
3. Contractors are holding their breath…and have put a freeze on their company’s expansion in fear that the President must reduce the Government size of employees and must reduce federal contracts.

The sole employer of the District of Columbia is the Federal Government…period. Without (a steady pace) an increase of the number of Federal Gov’t. jobs there is no justification for new housing…period. This study is fictional and fails to examine future job outcomes as a basis to justify increase building for housing.

Additionally, worker’s pay is far behind the increasing scales of inflation and lagging behind the rising cost of living essentials…food, transportation, utilities and insurance costs (health & property).

The planned expansion of Department of Homeland Security Annex Building on Mass. Avenue was suspended. I see a delay if not suspension of the planned DHS site at St. Elizabeth’s Campus.

This study must be a last call for developers to ensure that they can keep food on the table. I don’t see it happening – increase housing numbers planned for 2030 coming true. Chg.

Comment by John Black

Fri, 19 Oct 2012 13:45:24 EDT

Arlington is being praised for its commitment to affordable housing in its Form Based Code along Columbia Pike when the reality is that the area could sustain much, much more density than is on the table. It's a perfect example of how both politicians and the planning community lack the boldness required to address these issues.

Comment by Tom Coumaris

Thu, 18 Oct 2012 20:25:27 EDT

New-built is usually in commercial or high residential zones in DC. Of course we don't even make use of the units allowed in R-4 and R-5 zones in DC now for some weird reason. That's why a tax incentive is necessary.

Comment by goldfish

Thu, 18 Oct 2012 17:28:16 EDT

@Sage: thanks for the population data. Plotted as log(pop) vs year, the data is very linear. Fitted to a straight line the rate is 1.642% +/- 0.07% per year, with an excellent R-value of 0.9946.

That is very stable growth, good enough to project out 20 years. The increase is 38.8%, to a total population of 7.754 million, with an increase of 2.168 million.

Comment by Alex B.

Thu, 18 Oct 2012 16:22:00 EDT

Tom,

It's not like "new-built" housing isn't also constrained by zoning.

Comment by Tom Coumaris

Thu, 18 Oct 2012 16:16:40 EDT

This is a nice excuse for more new-built housing but ignores the effects of zoning and real estate taxation on existing structures which could accommodate many more units. Our existing housing stock in DC especially was geared to large family townhouses but are more often used today for single person or couple housing of way too much square footage.

New-built isn't going to solve all the problem. There has to also be zoning and real estate tax incentive to subdivide, for example, an existing 2400s' townhouse into 3 800 sq' units.

Comment by Sage

Wed, 17 Oct 2012 21:54:15 EDT

To give an idea of how much the National Capital Region has grown since 1980, here's the population numbers:

1980 3,401,522
1990 4,122,914
2000 4,796,353
2010 5,586,525

Since 1980, the region's population has grown between 600,000 and 800,000 each decade. If this rate of growth continues and is extrapolated to 2030, the population will approach or surpass 7,000,000.

Below is a link to a good map that clearly delineates the extent of the Washington Metropolitan Region:

http://en.wikipedia.org/wiki/File:Dc22counties.jpg

Comment by AA

Wed, 17 Oct 2012 17:48:56 EDT

Interesting that Jefferson County, West Virginia is considered part of Metro DC. Ah, the benefits of Metro (and MARC).

That has nothing to do with it. MARC has a very small number of riders on the Brunswick Line in the three WV stations. Rather, it's people that have jobs in Loudoun County and take avantage of cheaper housing Jefferson (and arelatively high level of amenities in WV). The taxes are better and houses are cheaper, and if you have a 35-40 minute commute to work, it's far cheaper in WV than eastern Loudoun or Fairfax (my mother is a teacher in central Loudoun, and about half the teachers live in WV)

Comment by Tom Coumaris

Wed, 17 Oct 2012 16:19:22 EDT

Interesting that Jefferson County, West Virginia is considered part of Metro DC. Ah, the benefits of Metro (and MARC).

Comment by Falls Church

Wed, 17 Oct 2012 15:11:46 EDT

I don't see those job forecasts panning out. There simply isn't enough infrastructure being planned to support that kind of job growth. Yes, there's a lot of infrastructure planned for Tysons but that's just a small part of what's needed to support those forecasts. Unless there's a seismic shift in political will, I don't see local governments building enough infrastructure to support those jobs. Perhaps new technology like telecommuting or driverless cars will enable more growth with less infrastructure but that's pretty shaky ground.

That said, the more interesting question is "why has there been a market failure for supply to meet demand over the last few decades?" Did developers underestimate job growth and housing demand (both quantity and type)? Are regulations too tight on building new housing? The article goes into great detail about the market failure but doesn't really tell us what caused it and how we can resolve the issue.

Comment by AWalkerInTheCity

Wed, 17 Oct 2012 15:07:37 EDT

"These numbers for Fairfax and Montgomery are both assuming a full build out of Tysons and White Flint for both jobs and housing."

In twenty years? I thought the county plan was for build out over at least thirty years. Full build out of Tysons, including the office space, over 20 years, sounds quite optimistic.

Comment by Kyle-w

Wed, 17 Oct 2012 14:56:18 EDT

@Sage

The city is adding about 1,000 residents a month at the current pace. I would guesstimate actual resident gains started in the late 2000's. In my neighborhood, in 2000, rowhouses were still going for 99k, which says to me that there was not a lot of demand. It doesn't take many years at 1k per month growth to get to that 800k mark. We are already over 620,000.

Comment by Sage

Wed, 17 Oct 2012 14:19:58 EDT

If the equation of 1.5 people per housing unit is used, 122,613 net new housing units in DC by 2030 would expand the District's population to nearly 800,000. That's almost a 25% increase from the 2010 census.

Considering that DC boomed during the 2000s, but only grew 5.2% in population, it seems unlikely the city will reach this projected estimate. Nevertheless, the city is growing rapidly, and reaching a population of 700,000 by 2030 is very possible, particularly if households with children begin to move in and stay, rather than leave.

Comment by Fitz

Wed, 17 Oct 2012 13:57:56 EDT

69% of homeowners will demand housing priced below $400,000 (in 2010 dollars)

Ok, that covers some of the 660 sq ft., 1 bed, 1 bed units. Anything larger and you're probably going to be SOL.

Comment by selxic

Wed, 17 Oct 2012 13:51:43 EDT

Considering the verbiage in this post, Howard and Anne Arundel Counties are likely lumped with Baltimore, Gull.

Comment by dan starzek

Wed, 17 Oct 2012 13:50:05 EDT

I await the day when we snatch Howard County from the Baltimore metropolitan area. Really most of the growth is from proximity to Washington. Not Bmo. On a side note, did you guys realize that projections now place DC (just the city) ahead of Baltimore city in terms of population? We are just surpassing them this year or something like that. Can't remember where I read that.

Comment by drumz

Wed, 17 Oct 2012 13:49:00 EDT

I can see it for fairfax certainly. Its just that its going to be in Reston, Tysons, Springfield and Route 1 and its all going to be a lot of vertical housing. Though it'd be nice to more urban development in the traditional parts of Vienna.

Loudoun is also getting into the WUPs game with stuff on the outskirts of Leesburg and Ashburn village going up quickly. My wife's school is surrounded on all sides by construction.

Comment by Gull

Wed, 17 Oct 2012 13:38:02 EDT

These numbers for Fairfax and Montgomery are both assuming a full build out of Tysons and White Flint for both jobs and housing. I find the relatively large estimates for Stafford and Spotsylvania more staggering. Also, why not count Howard and Anne Arundel Counties in MD at the least. They are closer in than some of the VA counties cited in the study, and being from MD, would venture to argue the DC region is becoming more and more a driving factor in their growth.

Comment by AWalkerInTheCity

Wed, 17 Oct 2012 13:22:37 EDT

110k in FFX over 20 years? I dont know. depends on A. if that 1 million net new jobs pans out B. How many will be either in FFX or in places where FFX is a particularly competetive commute C. how well the inner jurisdictions do in building WUP housing (since most of that 110k has to be in WUPs, FFX being built out for SFHs)

Also how many people retire in place, vs leaving the area. If the housing does not get built, and prices go up even more, the incentive to sell and retire elsewhere strengthens.

Comment by Rich

Wed, 17 Oct 2012 13:21:21 EDT

The important thing here is the assumptions and the likelihood they will hold in the future. Given that many people may remain in the workforce longer than in the past (e.g., fewer people with defined benefit pensions, long-term effects of the great recession on IRA/401k returns), federal spending may more or less contract and that patterns of family formation may change, this would have significant limitations. There probably are varying vacancy rates across the region which also may distort supply and demand. There also are variations in the degree to which housing might be subdivided or otherwise reconfigured in the future.

Comment by andrew

Wed, 17 Oct 2012 13:16:14 EDT

Methinks the demand numbers for NoVA are way too optimistic. I just don't see Fairfax or Loudoun sustaining that kind of growth for another 20 years.

Comment by charlie

Wed, 17 Oct 2012 11:12:02 EDT

Once again, you've got to take finance into the equation here.

We're experiencing a massive drop in housing units being built. If anything, DC is doing OK because you can get financing to build apartments and luxury condos.

Given that the current, 4-5 year recession and the promise of future cuts in spending over the next 20 years, I think reducing the job estimates by 3/4 is very realistic.