Category Archives: Housing

Home Values and School Quality

Source: Virginia Association of Realtors

by James A. Bacon

It has become commonly accepted wisdom that a leading cause of poverty  in Virginia is the phenomenon in which affluent citizens use their superior buying power to move to school districts with the highest quality schools. The poor, who have little buying power, are stuck in the worst school districts and get worse educations. Poor kids stuck in poor schools are more likely to grow up…. poor.

I am not disputing that belief, but I am subjecting it to critical scrutiny. The effect likely is real, but we don’t know if it is strong or weak.

On the one hand, there is abundant evidence that school quality and home prices are inter-related. In a recent blog post Lisa Sturtevant, chief economist for the Virginia Association of Realtors, cites a National Association of Realtors survey finding that 24% of home owners say the quality of schools was important when they were looking for a new home. The share rises to 42% for home buyers between the ages of 31 and 40. Another study has found that a five percent improvement in test scores in a school district can raise home prices by 2.5 percent. Another study concluded that homes in top-ranked school districts get more viewers and sell faster. Continue reading

Virginia Leads Nation in Distributing Rent-Relief Funds

by James A. Bacon

Virginia has done a better job than any other state in distributing its share of $46.5 billion in federal COVID-relief aid to renters, according to Treasury Department data published in the Wall Street Journal. Virginia has gotten 53% of its dollars into the hands of renters and landlords compared to 10% nationally.

Over the past four months alone, Virginia has distributed $235 million to nearly 35,400 families.

The program is administered by the Virginia Department of Housing and Community Development. Chesterfield County runs its own program, accounting for $7.9 million in distributions, as does Fairfax County, which has  passed out another $4 million, according to Treasury Department data

In contrast to the abysmal job of getting unemployment insurance payments to out-of-work Virginians, the distribution of rent relief appears to be a Northam administration success story. Continue reading

SCOTUS: Give Rochelle Walensky Something to Cry About

by Kerry Dougherty

It won’t be long before the U.S. Supreme Court smacks down CDC Director Rochelle Walensky’s order that revived until October 3rd a glaringly unconstitutional eviction moratorium.

I can’t wait.

They’ll give the woman who was blubbering about her feelings of “impending doom” last winter something to cry about.

In fact, the judiciary is already flexing its muscles. After landlord groups submitted an emergency filing to block the moratorium in D.C. federal court, a judge demanded that the government respond by tonight at 9 p.m.

Putting aside the audacity of a U.S. president urging unelected bureaucrats to issue clearly unconstitutional orders, this entire impulse — to side with renters over landlords — is a leap toward Marxism. Continue reading

The Accelerating Scale of the Legislate-Regulate-Spend-and-Repeat Cycle Has Broken Government

by James C. Sherlock

Virginians – the state and individual citizens – have received over $81 billion in COVID-related federal funding. That comes to $9,507 for every man, woman and child in the Commonwealth.  Big money. 

That was Virginia’s share of $5.3 trillion in federal spending just on the pandemic (so far). A trillion dollars is a million million dollars. A thousand billion dollars.

For comparison, GDP was about $21 trillion in 2020  It is projected to total just short of $23 trillion this year.  The national debt is $29 trillion and growing. A little over $86,000 for every American. That figure does not include the $5 trillion in additional spending pending in the Congress.

Every day we spend $1 billion on interest with interest on the 10-year treasuries at 1.18% today. The Congressional budget office predicts 3.6% before 2027. Do the math. That is $3 billion a day — well over a trillion dollars a year — in interest. 

Relax. If you thought I was about to launch off on a discussion of drunken sailors, writing checks that our grandkids will have to make good, and the fact that inflation will drive interest payments ever upward, be reassured I am not.

This is about the demonstrated inability of many government agencies at every level to regulate, administer, oversee, spend and repeat with anything approaching efficiency or effectiveness.  Continue reading

What Goes Up Stays Up

By Dick Hall-Sizemore

One of the explanations for the increase in the cost of new housing recently has been the surge in the costs of raw materials. Builders have been forced to pass those increased costs on to buyers.

Indeed, prices of materials, such as lumber, did increase significantly this last year, reaching a high during the spring. However, with supply chains opening up after the pandemic has eased, those lumber prices have decreased by about two-thirds. According to the theory, then, builders would be passing those savings on to buyers in the from of lower prices.

But, that does not seem to be the case. According to a Wall Street Journal article (yes, I know it will surprise some of you that I subscribe to the WSJ), builders are opting to keep prices where they are, thereby increasing their profit margins. Continue reading

Virginia’s Two-Decade Housing Construction Shortfall

by James A. Bacon

The pace of new housing construction in Virginia has fallen markedly since 2000 compared to the three previous decades, according to the Virginia Association of Realtors.

Between 1968 and 2000, 49,700 permits on average were issued annually for the construction of new housing units in Virginia. Since then, permits issued have averaged 37,600 new units yearly. Over the past two decades, the “housing gap” amounted to 243,000 units, writes Lisa Sturtevant, chief economist for Virginia REALTORS, in the association’s blog.

The deficit in housing construction drives up rents and home prices, Sturtevant says. “The consequences of the housing shortfall go beyond economic. Insufficient housing production has led to lower rates of household formation, more young adults living at home with their parents, and significant deterioration of the housing stock in many parts of the country.”  Continue reading

Print Me a House

3D printer used to construct a house                                 Photo credit: Richmond Times-Dispatch

By Dick Hall-Sizemore

For someone who stays away from housing issues, I now have my second one in two days. Yesterday, I expressed dismay at the price tag on new “affordable” homes. Today’s topic is 3D printed homes.

As strange as that may sound, the Richmond Times-Dispatch reported yesterday that work has begun in Richmond on the “first house in Virginia partially constructed using a 3D printer rather than lumber.”

I have trouble wrapping my mind around this concept.  =As I understand it, the “printer” is a large contraption that lays down concrete, rather than ink or toner, in precise patterns that have been programmed into a computer. The concrete is then smoothed out with a different nozzle that has a scraper attached. In the case of this house in Richmond, the printer is laying down layer after layer of concrete to “print” the outer walls of the house. The interior walls will be constructed by more traditional means. Continue reading

Sticker Shock

Creighton Court in Richmond         Photo credit: NBC12

By Dick Hall-Sizemore

I will be the first to admit that public housing policy is beyond my area of expertise. But, I am often amazed and befuddled at the cost of what is supposedly “affordable” housing.

Creighton Court is a traditional public housing complex in Richmond. The Richmond Redevelopment and Housing Authority has decided to raze the complex and replace it with a mixed-income development. RRHA earlier informed the public that some of the units would be houses “affordably priced” and marketed to first-time home buyers. So far, so good.

Today’s Richmond Times-Dispatch reports the projected price of these “affordable” homes: $400,000. People are reeling from the sticker shock. Even with a $50,000 down payment, the monthly mortgage payment would be over $1,400. For whom is this “affordable”? I had a decent paying state job and there was never a time at which I could have afforded a $1,400 mortgage payment. Continue reading

Podcast: How the General Assembly Has Changed

By Peter Galuszka

I haven’t contributed much to BR lately since I am slammed with non-Virginia work. I did manage to help out on a Podcast about how the General Assembly has changed the state over the last two years as Democrats have gained power.

This Podcast is produced by WTJU, the University of Virginia radio station. I do a weekly talk show on state politics and economics and, on occasion, work on Podcasts.

Joining me is Sally Hudson, a delegate from the Charlottesville area. She is Assistant Professor of Public Policy, Education and Economics. Sally studied at the Massachusetts Institute of Technology and Stanford and is one of the youngest members of the General Assembly.

I hope you enjoy it.

In Praise of Trailer Parks

Bermuda Estates, Chesterfield County

by James A. Bacon

Nobody knows for sure how many trailer parks there are in Virginia, and Del. Paul Krizek, D-Fairfax, wants to find answers. He has introduced a budget amendment to establish a Virginia Manufactured Home Park registry, to be funded with a $100 database maintenance fee from each mobile home park. 

Krizek regards trailer parks as a rare form of affordable housing in the state, and he’s concerned that market forces could put them out of business. Many were built long ago on land that was inexpensive at the time but due to the evolution of real estate markets has become desirable.

“The biggest problem is that the land is so valuable,” Krizek told The Virginia Mercury. “These parks are a gold mine for someone who wants to come in and build a 20-story apartment complex. I understand the need for density, but it’s sad when one of these communities goes away because they have been there for 20-30 years.” Continue reading

McAuliffe’s “Big Bold” Housing Plan Is Neither

Richmond homelessness. Credit: Richmond Times-Dispatch

by James A. Bacon

Homelessness spiked in the Richmond area over the past year — more than 50%, reports the Richmond Times-Dispatch. The increase from 549 to 838 people in 2020 was the largest single-year jump since anyone began tracking the number in the 1990s. Given the fact that hundreds of thousands of Virginians are at risk of eviction, homelessness likely will get much worse before it gets better.

Clearly, Virginia has a social crisis on its hands. The burning question is what to do about it. Do we treat the symptoms? Do we enact remedies that backfire and make things worse? Or do we address underlying problems?

We can get a glimpse of Virginia’s likely course of action by scrutinizing the plan to tackle the commonwealth’s housing crisis proffered by gubernatorial candidate Terry McAuliffe. Dominating the field of Democratic Party candidates, the former governor is the odds-on favorite to win the party nomination. Facing the survivor of the Republicans’ circular firing squad, that makes him the odds-on favorite to become Virginia’s next governor.

McAuliffe announced he has a plan — a “big bold” plan — in a Feb. 8 press release. In McAuliffe’s assessment, more than 260,000 Virginia households face the risk of eviction in the fall. Continue reading

Herring Strikes Blow for Emotional Support Animals

Phoebe, the Bacon family emotional support cat, provides companionship and comfort — in sum, helps us maintain a “happier more full life” — during the COVID-19 shut-in.

by James A. Bacon

Attorney General Mark Herring has issued a press release touting his victory in compelling a Pulaski County townhouse community to accommodate a couple with an emotional support animal.

“Virginians with disabilities have the right to live with an assistance animal, especially if that assistance animal helps them live happier, more full lives — assistance animals are not pets and cannot be subject to fees or breed and weight restrictions like other pets can be,” said Herring. “Assistance animals … are often the best way for individuals with debilitating symptoms caused by various mental or physical impairments to substantial improve their quality of life.”

Here are the particulars of the case, as recounted in the press release. The couple, Michael and Charlene Butler, provided “clinical verification” of the need to bring Charlene’s assistance dog to live with them in the Unique Deerfield Village Townhomes Complex. The property managers imposed weight limits and pet deposit fees on the assistance animal. Continue reading

To Solve Homelessness, Equip People to Rise from Poverty

The Brisben Center’s Ucan Club teaches families cooking and meal-planning skills they can take with them when they leave the shelter.

by David Cooper

There is an ongoing debate among nonprofits providing homeless shelters on the best way to address homelessness. Should they focus on finding places for people to live, regardless of what mental health or substance abuse problems they might have, or should they stress equipping them with life skills, even if it means a prolonged dependence upon the shelter?

As the staff of the Thurman Brisben Center has learned from serving the homeless of Greater Fredericksburg for 33 years — more than 7,000 individuals since 2005— homelessness is complicated. From underemployment and unemployment to physical/mental disabilities, from family breakups to poor credit histories, and from addictions to criminal justice involvement, the breadth of underlying causes is sobering.

The majority of homeless are working households and turn to shelters only as a last resort. A mere 14% — about 34 individuals locally — meet federal criteria for “chronic” (long-term) homelessness. However, they are targeted to receive the most government funding to permanently house them. Continue reading

Vacation Homes as Virginia Rural Resource

Vacation-home share of housing, 2018. Credit: StatChat blog

by James A. Bacon

Virginia has more than 88,000 vacation homes, about 2.5% of all homes in the Commonwealth, according to the University of Virginia’s Demographics Research Group. These “seasonally vacant homes” intended mainly for recreational use are overwhelmingly located in amenity-rich rural locales along the Chesapeake Bay, the Blue Ridge and Allegheny Mountains, or man-made lakes.

Moreover, reports StatChat, the vacation share of housing has increased since 2018 in most jurisdictions — more than 7.5 percent in some cases.

Bacon’s Rebellion has argued that Virginia’s rural counties should position themselves as destinations for retirement and vacation housing as an economic development strategy. Retirement and rental properties boost the tax base and create service jobs in localities where employment opportunities are otherwise scarce. Continue reading

High Housing Costs and Virginia’s Brain Drain

Hasta la vista!

Between 2010 and 2018 Virginia’s population grew by more than half a million residents, ranking 9th in the nation, due to strong natural increase (births over deaths) and steady international immigration. But the Old Dominion was only one of two states in the top 10 — the other was California — to experience negative net domestic migration, reports Lisa Sturtevant, chief economist for the Virginia Realtor’s Association in the Realtors’ blog.

Nearby southeastern states have shown strong domestic in-migration. What’s Virginia’s problem?

According to Sturtevant, the state’s biggest challenge is recruiting and retaining young workers. In continuation of a decade-long trend, about 6,00 more 25- to 34-year-olds moved out of Virginia in 2018 than moved in 2017 and 2018. These young people aren’t fleeing economically deprived rural areas. They’re leaving the high-cost areas, particularly Northern Virginia.

Says Sturtevant: “Even though professional opportunities are attractive and wages are high, home prices have gotten so high that it is increasingly challenging for young adults to buy homes. Many have been moving to places where jobs are still good but the cost of living is lower and it is easier to buy a home.”

— JAB