Moment, Linger On: Sticker shock

May 17, 2004

Sticker shock

Laura at Apartment11D will apparently soon be changing the title of her blog, because over the weekend she bought a house. Good on you Laura, and I can attest from experience that the shock of paying that amount of money for a thing wears off fairly quickly.

Meanwhile, Erika at the derivative Apartment 401 ponders how she was able to do it:

And yet another part of me, the part of me that has looked at our budget this way and that, at current housing prices this way and that, that part of me just wants to know the details. How? How much? I want to look at her numbers and figure out why my calculus suggests we stay put and hers suggests they buy. I suspect, in the end, that their children's schooling costs are what tipped the scale for them. But I'm curious anyway.
I can only imagine the stomach-churning stress that buying right now must induce. Prices are so high, they induce dizziness. My significant other and I looked at a condo near our apartment last weekend. It was listed for $300,000, which piqued my curiosity - so many places don't list a price at all. I was curious what $300,000 would buy.
Here's what $300,000 will buy you in Adams Morgan right now: two small rooms plus a tiny kitchen and bath. The entire condo was the size of our current living room. The kitchen was as big as my bedroom closet. I couldn't imagine more than one person in this space. This in the same neighborhood where $1200 a month will get you twice as much space and includes utilities. If you had to move, renting the entire unit would only cover 1/2 your mortgage. Yet there was a line of people waiting to look at it. So little to be had for less than $325,000 right now.
It's not so much that things are expensive. I understand that I live in a desirable area and that incomes here are high. But we are two professionals with good salaries. We don't have any kids. Our rent seems a bargain compared to what we'd have to pay for a house. What's going on in this market? Doesn't this seem a little crazy to anyone else?

I wouldn't have thought I would need to spell it out for her, but it really isn't that hard to understand. For those readers who are unfamiliar with DC, Adams Morgan is the current hip, happening, up-and-coming neighborhood in DC. It isn't Georgetown and it isn't Dupont Circle, but it isn't cheap either and it won't ever be again in my lifetime. If you were to look for affordable housing, Adams Morgan is the last place I would look. The equivalent for Laura would be looking for an apartment to buy somewhere in Manhattan, or one of the trendier neighborhoods of Brooklyn at the very least.

Laura, on the other hand, is moving to the 'burbs, and rather far out as well. A DC area equivalent wouldn't be Bethesda or Alexandria or Rockville, but rather Laurel or maybe even Frederick. If you want to buy a condo or a house there then you can get quite a bit for yoour $300K or even less. Of course, you don't get to walk down the street to Tryst or have easy access to African restaurants, but that's the kind of compromise that Laura made. Erika can make the same compromise if she wants but hearing complaints about unaffordable housing in DC's equivalent of the Village kind of wears thin.

Posted by Jay at 08:44 PM | Permalink

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May 17, 2004

Sticker shock

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