By Michele Lerner April 28 (Washington Post)
When Steve Goetz purchased his 800-square-foot condo in Columbia Heights about three years ago, the two-bedroom, one-bathroom home had more than enough space for him. But then he got engaged. Then he and his now-wife, Tiffany Williams, got a dog. Then they wanted another dog, which was against the condo rules.
“When we talked about starting a family someday we knew that the condo would be too small,” Goetz said. “We wanted to stay in the city, but we quickly discovered that to go up in size by 500 square feet would cost us about $200,000 more than the place we own now.”
Goetz purchased his condo for $300,000 and in the beginning of 2015 contacted a realty agent who estimated he could sell it for at least $400,000.
“We started exploring Rockville and Gaithersburg in search of more space and then found Hyattsville with the help of our Realtor, Balaram Owens with Real Living at Home,” Goetz said. “It seemed the closest to an urban environment, and we can walk to a grocery store and restaurants.”
Goetz and Williams purchased a newly built end unit townhouse with 2,000 square feet, a back yard and a deck.
“We feel like we made the right decision because we love the space, especially the outdoor space,” he says. “On the other hand, we’re in a pseudo-urban environment and we still miss our favorite Thai restaurant.”
The couple’s Columbia Heights condo sold for $423,000, and their new place, with more than double the square footage, cost $435,000. Goetz estimates that a comparable home in the District would cost $800,000 or more, if they could even find a similar place. Their commute time increased by about 20 minutes via Metro. The couple continues to live without a car even though they have a two-car garage.
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Goetz and Williams are not alone in discovering that their dollars go further outside the District’s borders. According to a recent report by Redfin, on a national basis the typical home sold in 2015 was about 4 percent farther from a city center than the typical home sold in 2011. In the D.C. area, the median distance of sold homes from the city center rose from 16 miles in 2011 to 16.9 miles in 2015. While that sounds negligible, it’s a 6 percent increase in distance from the city.
The affordability gap between D.C. and its suburbs is among the widest in the country, according to Redfin’s data. The median price per square foot in the city was $511 compared with $187 in the metro area in 2015.
Goetz and Williams purchased a newly built end unit townhouse with 2,000 square feet, a back yard and a deck. (Katherine Frey/The Washington Post)
The couple’s Columbia Heights condo sold for $423,000, and their new place, with more than double the square footage, cost $435,000. (Katherine Frey/The Washington Post)
Redfin’s findings are supported by the “2016 Home Buyer and Seller Generational Trends Report” from the National Association of Realtors (NAR), which found that contrary to the popular image of millennials flooding the cities, more of them are buying in the suburbs than in the past. The survey shows that the share of millennials buying a home in an urban or central city location decreased to 17 percent in 2015 from 21 percent in 2014. In addition, fewer millennial home buyers purchased a multifamily home (10 percent) in 2015 compared with 2014 (15 percent). NAR’s survey found that the majority of buyers in all generations purchase a single-family home in a suburban area.
Young buyers, even when they want to live in a city, often find it impossible to find something they can afford there. Some buyers will decide to continue to rent. For others, location trumps home preference and they’ll buy something smaller or in worse condition than they anticipated. The rest head to the suburbs.
The most affordable prices in the closer-in suburbs right now are found in Prince George’s County.
According to Rockville-based multiple-listing service MRIS, 50 percent of single-family homes listed for sale in Prince George’s County in February were priced under $300,000, compared with 12 percent in the District, 4.5 percent in Montgomery County and 4.3 percent in Northern Virginia.
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Ria Caldwell and her fiance, Will Townshend, both recent law school graduates at the University of Virginia in Charlottesville, started jobs in D.C. and hoped to buy a home in the Capitol Hill neighborhood, where they rented while working in the city last summer. The couple has three dogs that collectively weigh more than 80 pounds, so renting is not an option.