Will houses ever become affordable again?

[Anonymous]

Not until boomers die and their kids sell the homes they inherit.

[Anonymous]

OP, We had to move buy a fixer upper farther away from work to even get on the property ladder. It needed major structural work on one wall.

We had to move out of the area to afford a SFH., and it was also a fixer upper. It was so bad the owners refused to put it in Zillow, b/c they didn’t want to do the work. Mold, pet damage, leaks, etc. We both have masters degrees. It felt like we should be able to afford nicer homes, based on what our parents bought, but in the end we had to make our homes nice. We simply couldn’t afford to buy them that way.

[Anonymous]

Anonymous wrote:Yes, as the Boomers start to move into care homes and die, lots more will become available, and there won’t be such intense competition.

Nope. We will just pass our primary home on to our kids in a trust & they will continue to lease our rental real estate to you losers.
Sucks to be you huh?

[Anonymous]

I kinda feel like we’ll have to keep any houses we inherit to pass on to our own kids. Stinks, as I don’t want to be a landlord, but I also don’t want my kids to be renters forever. In the European country that DH is from, the family house passes on to the oldest DC. As an American, this doesn’t sit well with me, so I don’t know what else to do.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Yes, as the Boomers start to move into care homes and die, lots more will become available, and there won’t be such intense competition.

Nope. We will just pass our primary home on to our kids in a trust & they will continue to lease our rental real estate to you losers.
Sucks to be you huh?

+1 that’s the plan

[Anonymous]

We have two empty sfhs in our neighborhood, and the adult kids who inherited them seem to be in no hurry to clean them out and put them on the market. Unsure if there are estate issues or what.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If we build more housing. Basically the great recession killed housing starts and they have never gotten back to where they were.

That won't affect the prices because if you build it, they will come. So many people want to live here, they just keep packing them in. Increasing supply from an economic principle should lower price but in reality for real estate in the DMV that won't happen and hasn't happened because more and more people just keep moving here. So more demand with more supply.

That was part of the missing middle argument, that home ownership is like a property ladder and in order to make those apartments and homes more affordable at the bottom of the ladder, we needed to increase supply in the middle and people move up the ladder, freeing cheaper housing, stabilizing prices. But that assumes a limited demand. In reality, there is just too much demand and it keeps increasing. Hence you can keep building gigantic $2 million duplexes and THs and people will STILL buy them. Prices will never go down here.

Prices will stabilize with more supply IF you sharply tax investment properties/2nd homes. The issue is that people retain their cheap condo/starter home on the bottom of the ladder and rent it out. You need to force that supply back into the ownership market for the virtuous cycle to continue. Also need to ban LLC's from owning SFHs, townhouses, and individual condo units. If big money corporates like Blackrock want to own RE, they need to build or purchase large multifamily developments to rent out.

None of those things are going to happen in government. Stop with the fairytales.

Not sure why not. So many jurisdictions claim to have housing shortages and instead of dumb proposals like missing middle or thrive 2050, they could just dramatically increase property tax rates on investment properties and the housing supply would dramatically increase overnight. Kind of baffling actually except that no one actually really cares about housing shortages and instead the goal is to make developers rich.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Yes, as the Boomers start to move into care homes and die, lots more will become available, and there won’t be such intense competition.

Best laugh I've had in a while. Thanks for making my day!

Boomers have been selling for the last 15 years. How’s that working out?

[Anonymous]

Anonymous wrote:

Anonymous wrote:If we build more housing. Basically the great recession killed housing starts and they have never gotten back to where they were.

That won't affect the prices because if you build it, they will come. So many people want to live here, they just keep packing them in. Increasing supply from an economic principle should lower price but in reality for real estate in the DMV that won't happen and hasn't happened because more and more people just keep moving here. So more demand with more supply.

That was part of the missing middle argument, that home ownership is like a property ladder and in order to make those apartments and homes more affordable at the bottom of the ladder, we needed to increase supply in the middle and people move up the ladder, freeing cheaper housing, stabilizing prices. But that assumes a limited demand. In reality, there is just too much demand and it keeps increasing. Hence you can keep building gigantic $2 million duplexes and THs and people will STILL buy them. Prices will never go down here.

Missing Middle was allegedly about making housing more affordable but it was really about introducing different types of housing into single family neighborhoods. So you can rent a three bed apartment in a six plex and live next to a 1950s colonial with three bedrooms. The former will provide the clean and shiny that the latter lacks.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If we build more housing. Basically the great recession killed housing starts and they have never gotten back to where they were.

That won't affect the prices because if you build it, they will come. So many people want to live here, they just keep packing them in. Increasing supply from an economic principle should lower price but in reality for real estate in the DMV that won't happen and hasn't happened because more and more people just keep moving here. So more demand with more supply.

That was part of the missing middle argument, that home ownership is like a property ladder and in order to make those apartments and homes more affordable at the bottom of the ladder, we needed to increase supply in the middle and people move up the ladder, freeing cheaper housing, stabilizing prices. But that assumes a limited demand. In reality, there is just too much demand and it keeps increasing. Hence you can keep building gigantic $2 million duplexes and THs and people will STILL buy them. Prices will never go down here.

Missing Middle was allegedly about making housing more affordable but it was really about introducing different types of housing into single family neighborhoods. So you can rent a three bed apartment in a six plex and live next to a 1950s colonial with three bedrooms. The former will provide the clean and shiny that the latter lacks.

Maybe that was the argument where you live but it wasn’t the argument where I live in Alexandria.

[Anonymous]

Anonymous wrote:OP, We had to move buy a fixer upper farther away from work to even get on the property ladder. It needed major structural work on one wall.

We had to move out of the area to afford a SFH., and it was also a fixer upper. It was so bad the owners refused to put it in Zillow, b/c they didn’t want to do the work. Mold, pet damage, leaks, etc. We both have masters degrees. It felt like we should be able to afford nicer homes, based on what our parents bought, but in the end we had to make our homes nice. We simply couldn’t afford to buy them that way.

Those estate homes need to be reported to the jurisdiction and hit with the vacant property tax penalty rate. Get them moving into new hands.

DC is ruthlessly brutal about slapping an empty house with that orange VACANT sticker.

[Anonymous]

My parents own a 10 year old townhouse near a teaching hospital and a good portion of the units are owned by a Chinese man (as in, lives in China) who rents them out at very high rates to local medical students without ever even seeing his properties. I don't think our country should allow this.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our only true hope is if Biden is reelected. And even then it would require an enormous number of stimulus check sent to undo the rapid increase in prices. I have serious doubts that Congress has the fortitude to pass this.

Although I also do hope Biden gets reelected, honestly I don't think stimulus checks and pumping more money into the economy will solve the problem, hell I would argue that caused the problem in the first place.

During the pandemic, not only did the government pumped a lot of money into the economy. First of all the COVID stimulus checks, which rather than targeting those who lost their job, just gave everyone $$. Then they paused student loan payments (for far too long, I would argue the pause was unnecessary for most people). Last the foreclosure (and eviction I guess) moratoriums also ensured that supply stayed low. And last (granted this is out of the executive office's control), FED rates were kept low for far too long (making mortgages much cheaper than they should be, causing house prices to increase, and also causing the inflation in other sectors).

We don't need to government artificially pumping more money in, this will only make the problem worse.

If you look at the underlying components contributing the most to inflation today, it's housing and insurance. And the insurance portion is driven by the fact that natural disasters are becoming more frequent/severe and the cost to rebuild is so high (due to the high cost of real estate).

We are going to be stuck in this cycle for a while, until either more supply is quickly added (would require something like a Manhattan Project for housing) or we get a real recession with lots of widespread pain that forces the hand of investors to dump supply on the market.

Agreed either some increase in supply (through a government intervention providing incentives to build) or some form of a moderate recession that forces people to sell.

I guess another possibility is (and I do not know how realistic this is) is if Trump wins the next election (god I really hope he wont) and then moves certain federal agencies outside the DMV area. If those jobs move/leave the area, I could see it having a dent in the DMV market as well (increased supply and reduced demand). There are around 374k federal government employees in the DMV area (https://fred.stlouisfed.org/series/SMU11479009091000001SA) which is a significant number. A reduction in that could have some serious (negative imo) ripple effects for the area.

He'll be gutting/eliminating agencies.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Our only true hope is if Biden is reelected. And even then it would require an enormous number of stimulus check sent to undo the rapid increase in prices. I have serious doubts that Congress has the fortitude to pass this.

Although I also do hope Biden gets reelected, honestly I don't think stimulus checks and pumping more money into the economy will solve the problem, hell I would argue that caused the problem in the first place.

During the pandemic, not only did the government pumped a lot of money into the economy. First of all the COVID stimulus checks, which rather than targeting those who lost their job, just gave everyone $$. Then they paused student loan payments (for far too long, I would argue the pause was unnecessary for most people). Last the foreclosure (and eviction I guess) moratoriums also ensured that supply stayed low. And last (granted this is out of the executive office's control), FED rates were kept low for far too long (making mortgages much cheaper than they should be, causing house prices to increase, and also causing the inflation in other sectors).

We don't need to government artificially pumping more money in, this will only make the problem worse.

If you look at the underlying components contributing the most to inflation today, it's housing and insurance. And the insurance portion is driven by the fact that natural disasters are becoming more frequent/severe and the cost to rebuild is so high (due to the high cost of real estate).

We are going to be stuck in this cycle for a while, until either more supply is quickly added (would require something like a Manhattan Project for housing) or we get a real recession with lots of widespread pain that forces the hand of investors to dump supply on the market.

Agreed either some increase in supply (through a government intervention providing incentives to build) or some form of a moderate recession that forces people to sell.

I guess another possibility is (and I do not know how realistic this is) is if Trump wins the next election (god I really hope he wont) and then moves certain federal agencies outside the DMV area. If those jobs move/leave the area, I could see it having a dent in the DMV market as well (increased supply and reduced demand). There are around 374k federal government employees in the DMV area (https://fred.stlouisfed.org/series/SMU11479009091000001SA) which is a significant number. A reduction in that could have some serious (negative imo) ripple effects for the area.

He'll be gutting/eliminating agencies.

Dude is not getting elected, sorry. If Jan 6th never happened it probably would have been a cakewalk to winning, but it did, and moderates are hard passing on any MAGA candidate. Better start planning for a Biden term.

[Anonymous]

Anonymous wrote:I’ll be the naysayer who believes prices will become more affordable. See the WSJ article today on the cost of homeownership. Taxes and insurance keep rising at a rate that will push many homeowners to sell. This, coupled with the Boomers moving out, will result in a softening of the market. I have no idea if prices will actually decrease or just stop increasing nor do I predict when this will happen.

The population keeps increasing. Historically, has property decreased in value? No. Look at Europe - most people live in high rises. That will be the trend here and SFH will be luxuries.