Thursday, October 30, 2008

Affordable Housing in the Charlottesville Albemarle Area

The local Realtors' trade org, the Charlottesville Albemarle Association of Realtors (CAAR), had a series of Open Houses this past summer and a promo entitled "Affordable Again."

"Affordable Again" referred to a price tag below $250,000. We laughed at this, because the term "Affordable Housing" obviously means something much different to Realtors than it does to activists interested in equitable living arrangements for those with low incomes.

Do the math: a monthly 30 yr fixed on $250K is about $1,900 per month at 6.5%, including property insurance, taxes, and mortgage insurance. Annually, the payments are about $23,000. A responsible homeowner would allot about 1/3 of income toward housing costs. Thus, the income needed for this house would be about $70,000 per year.

Currently, sales are down 40% over last year in the County; about 10% in the City. But still, the prices remain idiotic, ioho. See what we mean by searching the Multiple Listing Service at Click on "Property" and fill in your parameters. What pops up are not Quarter of a Million Dollar Houses anywhere except a Bubble--or Charlottesville.

And we were reminded of all this when we drove down Nassau Street the other day. We saw "Affordable Again" signs posted proudly in front of 909, 911, and 913 Nassau (MLS #s 449103, 449105, 449104). 909 is the house pictured here. We're wondering what it was before? A tool shed? The machine shop? It's two rooms, and the listing says

"Cute 1BR, 1BA, LR, Kitchen, Minutes to UVA, Downtown Mall, & convenient to everything. Large yard, off street parking, close to part. Home sold as-is. Great for Investor!!!"

$99,900.00 - two rooms, 402 square feet

In all seriousness. "Close to everything" also means Charlottesville Livestock yards and the cement plant. It was a sorry sight; the properties were filled with junk. We were embarrassed for all Realtors.

This reminded us of recent Daily Progress stories about "Affordable Housing" in the City and the County.

A few days ago, it was reported that the City, County, and UVa formed a task force to deal with the issue of lack of affordable housing in an area whose cost of living is higher than the national average, according to the ACCRA Cost of Living Index. No progress was made--except to declare that more affordable housing is needed.

The City knows it needs more data, but doesn't know how to go about getting it. Is this any surprise? Charlottesville spent $2.1 million on affordable housing last fiscal year, yet the city has no record of the numbers of planned or completed affordable units.

What? Sometimes we think Charlottesville has gone through Alice's looking glass.

So what's the solution?

Of course we have one. Not only is there a nearly 15 month supply of houses in this area, but the new construction sector is in trouble here as it is nationwide. Hauser Homes is offering "discounts." And let's face it, some of those places at "green" "Belvedere" and "The Fields at Venable" aren't going to sell unless they, too, get "discounts," are they?

First, let's get these new houses reassessed to "reasonable amounts." Second, let's line up some nice citizens to get 97% LTV FHA loans while they're still available. Let's have the Builders guarantee the loans in lieu of "proffers" to the City or County. After about 6 months of payments, let's advise the debtors to stop paying. Default/Foreclosure in short order, right? Wrong. By then, the Federal Government will have stepped in, and will renegotiate the Principal and Interest on the mortgages.

Bingo. "Affordable Housing."

We wish we were kidding.

1 comment:

Anonymous said...

"The Fields at Venable" (which is such a pretentious name I'd like to yak) is offering special deals on the two end units through the Piedmont Housing Alliance Instead of 350k+ these units are around 250 for "qualified buyers" meaning "low income" (whatever that means around here...John McCain's 5M middle class comment comes to mind).

Thought Down Payment Assistance was a thing of the past.

Anybody who buys into that debacle called Belvedere better be getting an incredible deal. It's never going to be what it was originally promo'd. Feel sorry for the 2 or 3 families that live there already.

They're stuck.