Second Annual Regional Housing Summit Seeks Solutions to Housing Unaffordability
"The status quo isn't going to fix anything."
By Adele Uphaus
MANAGING EDITOR AND CORRESPONDENT
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As of Tuesday, there were 746 active listings in the local real estate market. Of those, 60% are priced at over $500,000. Just 28 are listed at $300,000 or below.
“There are more homes for sale over $1 million than there are under $300,000,” said Kim McClellan, public policy director for the Fredericksburg Area Association of Realtors, to the audience at the second annual Regional Housing Summit on Thursday morning.
That means the market offers a lot of options to the buyer with a budget of $1 million, but “if you are a $325,000 buyer, it is incredibly competitive,” McClellan said. “You’ll be wondering, ‘How will I ever be able to afford anything?’”
That is the question those who attended Thursday’s event at the Fredericksburg Expo Center would like to be able to answer. As McClellan and fellow keynote speaker Jonathan Knopf, executive director for programs at HousingForward Virginia, presented, the Fredericksburg area’s core workforce is made up of those who work in retail, healthcare, education, and public administration and for whom a $500,000 house is not affordable.
The Fredericksburg area—especially in the counties of Stafford and Spotsylvania—is projected to grow. People want to come here because it is more affordable than northern Virginia and the area has experienced cumulative job growth and is “economically vibrant,” Knopf said.
But the housing supply is not meeting the demand, McClellan said. The historically low interest rates of several years ago have led to a “locked-in” effect, in which those who bought at 3% interest aren’t selling their homes and moving unless they absolutely have to.
“We also aren’t in a bubble,” McClellan said. Home prices aren’t coming down dramatically and interest rates are also unlikely to drop as low as they were.
And, McClellan continued, “We aren’t building enough homes.”
“The pace of building has not picked up (since the Great Recession). Buyers have fewer options,” she said.
These pressures create challenges for the core workforce. Eighty percent of working households that make less than the area median income are cost-burdened, meaning that housing costs take up more than 30% of the household’s gross income.
“That includes essential government workers, who face an uphill battle,” Knopf said. “Many public servants also can’t afford average rent. So in terms of trying to attract young talent—they will have a hard time [affording to live here] on a single salary.”
Knopf said local governments “can do a lot to make things better” for those who want to live and buy homes in the Fredericksburg area.
“The status quo isn’t going to fix anything,” he said.
Thursday’s summit was presented by the Regional Housing Assembly, which is made up of organizations and individuals and serves as an advisory group on issues of housing and health.
Following the keynote address were two breakout sessions with panels on topics such as “Solving Affordable Housing through Local Partnerships;” “Integrating Housing in Your Comprehensive Plan;” “Creating Walkable, Transit-Accessible Communities;” and “Critical Repair and Rehab Programs.”
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It is going to get a lot worse if we elect Trump. He plans to deport most of the construction workforce, so where would builders find the necessary labor to build, even if the zoning barriers to denser construction were removed.