Reply to Alexandria on the Cusp of Eliminating All SFH Zoning

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I don't know...sounds like eliminating SFH zoning is a boon for existing SFH owners.  Won't a developer that intends to replace your SFH with a 4-plex or 6-plex be willing to offer a major premium over someone who simply will use it as a SFH?

Am I missing something?[/quote]

PP here. Sure, the money's nice, but it's a one-off. We're all screwed when we go to buy a home that's the next level up. Many homeowners are already stuck in place because of interest rates and increased home values over the last few years. The issue is ill-timed and will only add to the inventory problem. And no, four townhomes here and there won't help.

Housing aside, my real issue has more to do with Council's arrogance and dismissive behavior, paired with how they talk out of both sides of their mouth. It's affordable housing all the live long day and then they pull this. It's a betrayal of trust. I'm actually not sure they even know what they're advocating for. It's like they're easily distracted by shiny buzzwords.

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It seems that the existing SFH benefits through the entire homebuying process.  If the current SFH will only sell for $1MM because it is zoned as SFH, but literally is worth $1.5MM overnight because a developer can now build a 4-plex...well, now you can buy that $1.25MM home for cash/minimal mortgage.

Again, am I missing something?  Once the zoning changes, existing SFH owners' values will be "artificially" inflated assuming their property is actually developable into a 4-plex.[/quote]

You're getting closer. In your suggestion, the SFH is newly worth $1.5M with the change. You suggest selling and taking $1.25M in cash to buy something better than what you had, but fail to realize that you'd have to spend MUCH MORE than the $1.5M.

OR...you get to pack up the life you created and move away. Otherwise, all you're buying is one of those new overpriced townhomes...because the money doesn't go as far as it once did.

Also, I don't think the increase would be artificial. It's more of a by-product of the new enhanced flexibility of the land.
[/quote]

I just sold my house for $1.5MM that the day before the zoning change was worth $1MM.  How is it possible I have to spend MUCH MORE than $1.5MM for another house?  I will agree, let's say I am moving just outside the boundary for Alexandria SFH...in theory, the house I buy there that is similar to what I just sold (let's assume the demographics of the location are the same) is cheaper because they don't get the price premium from the zoning change.

[/quote]

[b]Sure, if you bought an identical home to the $1.5M one you sold, the price would be comparable.[/b] But no one does that.

In fact, your theoretical tells me you’ve never sold a home.

It sucks, so people typically don’t go through the hassle of selling just to buy a similar home in a similar neighborhood. Not unless something weird is going on—like they hate the neighbors.

Second, the answer to your question is stated in both your response and my original post. Higher prices will drive out people seeking bigger homes/affordability.

I recommend visiting Redfin or Zillow. Compare similar sized properties in Del Ray and down the parkway. Check the price per square foot. It may be helpful to you. I have a feeling you’re  more of a visual person.[/quote]

DP and I'm not trying to argue with you, but genuinely understand.  Certainly nobody would ever expect to sell their current home and be able to but a nicer/bigger one in the same area at exactly the price you sold?  That isn't how it works...ever, regardless of how anything is zoned.  And that is for exactly the reasons you cite.  If I bought my home at 700K and sell at 1M, I would only expect to get something comparable to my current home for that same 1M.  My existing home is literally a comp.  You have to spend more to get something more.  I just don't see how zoning changes this for the worse.[/quote]

Check out the below quote. It  suggests the up zoning will cause  property values and price gaps to widen at a faster pace, the crux of the declining affordability issue at hand.

[quote]You’re correct in theory. Yes, the existing home also grows in value BUT the major threat is the growing difference in price gaps between property types.

For example, a nice condo ten years ago might be a $300k price difference from a nice townhome in the same area. Now the spread is more like $500k-$700k.

Ten years ago you could get a nice Del Ray bungalow for $800k. Now it’s more like $1.6M+.

People are required to save and spend a lot more to accommodate the next stage of life. Plus rates are higher. Plus inflation. Etc.
[quote][/quote]

Whoah dude...don't interlope on our side conversation on zoning and values.  You are butting in and taking things out of context in order to support your little argument.

Our conversation is completely about how up-zoning will help EXISTING, SFH OWNERS.  The lucky ones sitting on a 4-plex development site will probably benefit because now your home is viewed as an investment property for a developer.

Now, paying let's say $1.5MM for your home (that yesterday was worth $1MM) could still be a great deal for that developer that yesterday may have had to spend $2MM to find empty property that was zoned for the duplex.

So, it is quite likely while the existing SFH owner gets this bump...it could very well result in lower condo prices.[/quote]

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