Zip code variation in the recovery of real estate prices in the Seattle metro region. Image credit: Wall Street Journal.
Here’s more data, as if it were needed, that the recovery of housing prices is very lumpy across the United States — not just uneven between metropolitan regions but within regions. Drawing upon the Zillow database, the Wall Street Journal plots the zip code-by-zip code disparity in changing housing prices.
“The data paint a picture of an uneven housing recovery that is lifting some neighborhoods while bypassing others just a few blocks or miles away,” the article says. While the article focuses mostly on Seattle, it also mentions the dynamics in the Washington region.
Washington zip codes that aren’t close to the city or near the Metro rapid-rail system aren’t as desirable to buyers. “If it’s a great location, it’s getting multiple offers and sometimes bid up,” said Dina Paxenos with Washington brokerage Evers & Co.:
Other areas are often out of luck. Ms. Paxenos cited a listing she has had for almost three months: a 1,000-square-foot one-bedroom condo in southern Arlington County, Va. Known as Shirlington, the community was developed as an “urban village” outside Washington—a boom-era concept mixing condos and retail. There is a shuttle to the Metro, but most buyers prefer to be within walking distance, Ms. Paxenos said.
According to Zillow data, the ZIP Code that includes Shirlington has seen home prices fall by 1%. But in an Arlington neighborhood three miles away, which is walking distance to the Metro and flanked by the Pentagon City and Crystal City shopping centers, values have risen 9.4% over the past year, putting it just below the neighborhood’s peak prices in 2006.
As the article notes, Arlington has developed Shirlington as a mixed-use urban village served by a dense network of bus lines connecting to Metro stops and other locations. But home buyers don’t value that as much as access to the mixed-use development along the Ballston-Rosslyn corridor. Lest anyone should seize on that data as an indictment of mixed use, consider also that the price decline was only 1%. Zip codes on the metropolitan fringe dominated by single-use development are losing far more value, at least in Seattle.
Are we witnessing the death of the exurbs? “Death” might be a melodramatic. When prices drop low enough, housing prices will stabilize. If those prices are beneath the cost of building the houses and supplying the infrastructure, however, don’t expect to see much more new construction. Local governments beware!
Bonus question for Loudoun County: What do these trends means for your population growth projections? And what do they mean for the economic viability of the Rail-to-Dulles METRO stations in Loudoun?
— JAB
