The average sales price for a single-family home in Loudoun County has now topped $650,000, making home ownership an even more remote dream for workers in the service industry.
At the same time, the average home stays on the market only 27 days, compared to 86 days in 1999, according to the Center for Regional Analysis, a division of George Mason University's School of Public Policy.
And homeowners are doing anything to get their hands on a bigger and better home. Lenders report that traditional 15- or 30-year fixed-rate mortgages are on the decline, and more risky adjustable rate mortgages (ARMs) are allowing homeowners to jump from home to bigger home.
In Brambleton, young families find themselves in townhouses that they will soon outgrow, said resident Sarah Greenblatt.
Greenblatt and her parents invested in the townhouse where she lives. It has appreciated in value nearly 20 percent since last year.
"Brambleton is a hotbed of turnover for real estate," Greenblatt said. "There are homes selling there now for $100- to $150,000 more than what they were purchased for a year and a half or two years ago. It's ridiculous. It's full of investment properties."
Greenblatt and her parents opted for a traditional 15-year fixed-rate mortgage for her townhouse. Still, the family embodies a trend in real estate: while the elder Greenblatts have lived in the same Sterling home for 35 years, their daughter views her current environs as more of an investment than a permanent home.
ADJUSTABLE rate mortgages work well if interest rates stay low, as they have for the last five years. But they can become very high-risk if interest rates change.
Still, ARMs are growing in popularity because initial payments are lower than a longer-term fixed-rate mortgage.
"Most people are moving within five years or so," said Marco Umana, a lender with Prosperity Mortgage. "For that reason, [ARMs] are more attractive. Now it's less a home, but an investment a family can have because of the appreciation."
An ARM allows families to gain good credit that can be used to trade up into a larger home with greener grass, much like the way people often buy cars.
A change in federal real estate law in the late '90s made home turnover easier.
"A lot of our clients are taking advantage of the tax law that allows them to purchase and sell every two years," said Lars Henricksen, assistant manager at Long & Foster's Ashburn office.
In Loudoun, good credit is an essential to moving up to a larger home. But the skyrocketing demand — and, by association, prices — has made it impossible for many of Loudoun's workers to live here, credit or no credit, and that's a regionwide phenomenon.
Because Northern Virginia is the country's third-fastest producer of new jobs and has the country's second lowest unemployment rate (2 percent), there aren't nearly enough homes to house them, said Stephen Fuller, the nationally-renown economist and director of the Center for Regional Analysis.
"There are no workers to fill those jobs in Northern Virginia," Fuller said. "These workers have to move from somewhere. There's no vacant housing sitting out there to speak of."
CURRENTLY, there are 345 families on the county's waiting list for affordable housing, according to the county Department of Housing Services.
While 60 of those families are simply awaiting the construction of their homes, the remaining 285 families represent a significant challenge for the county.
Since it sold its first home to a qualified family 10 years ago, the county's Homebuyer's Opportunity Program has placed 985 families in homes at an average of 125 to 175 families a year, said housing counselor Lenny Goldberg.
Those 285 families, meanwhile, could be on the waiting list for years.
Now they're scattered all across the region as they wait.
"Some of them live in Loudoun, some of them in Fairfax, West Virginia, Pennsylvania," Goldberg said. "Almost all of them work in the Northern Virginia area and they commute. They want to live closer to where they work."
In order to qualify for affordable housing assistance, a family must earn between 30 percent and 70 percent of the area's median income. According to the U.S. Department of Housing and Urban Development, the median income here is $89,300.
That means a family of four would have to earn between $26,800 and $62,500 to qualify for assistance. They must also be first-time homebuyers or not have owned a home for at least three years.
The rising price of real estate in Loudoun County isn't helping any, Goldberg said.
"As the prices of the market rate homes have increased, that just puts them further and further out of reach of the clients we serve," Goldberg said.
TO FULLER, the region needs more homes, and quick.
Last year, the metropolitan region — including Washington, D.C., and suburban Maryland — added 64,200 new jobs.
"No other metropolitan area came close," Fuller said.
Assuming one and a half workers per home, the region needed to add 42,800 new units just to match one year's job growth in 2004.
But the region only added 27,000 new homes — a 15,000-home shortfall.
As it is, 300,000 people commute from outside of the region to work here every day — including half of Loudoun's residents, many of whom end up in jobs-rich Fairfax County.
But adding new houses won't necessarily add more affordable houses, said Ed Gorski, Piedmont Environmental Council's land-use officer for Loudoun.
"Housing is not a true supply-demand issue," Gorski said. "I have never seen the market on its own provide affordable housing."
Houses will sell at whatever price the market will bear, Gorski said. Right now, people will buy a single-family home in Loudoun at $650,000. Adding thousands of new single-family homes in the county probably won't outstrip demand any time soon — and the PEC has lobbied hard to prevent those thousands of new homes from being added.
GORSKI pointed out that there are already more than 30,000 units, or five years' worth of approved houses, in the pipeline for Loudoun.
While developers sometimes negotiate for higher density building by offering affordable dwelling units, or ADUs, Greenvest LC has presented a different kind of plan to go with its 14,000-home proposal in the Dulles south area.
Greenvest is offering what it calls "workforce housing" that would be sold at 70 percent to 80 percent of the market rate.
That means an average $650,000 house would go for approximately $470,000 to a member of the "workforce" — someone Greenvest has characterized in pamphlets as a first-year teacher, firefighter or police officer.
"I don't know too many entry-level teachers, firemen and police officers who are really going to afford $470,000," Gorski said.
Developers very rarely offer affordable housing without some sort of expected tradeoff, with one notable exception, Gorski said.
In the early '90s, John Andrews, now chairman of the school board, sold a block of homes below market rate off Hay Road in Ashburn. The homes, naturally, sold instantly.
On the school board, Andrews has been one of the most vocal proponents of paying teachers enough to make home ownership a possibility. This year, the school board voted to increase first-year teacher salary to $39,600, making it among the highest in the region.
THE REAL estate market, which has been in a boon since 2000 — with a slight dip after Sept. 11, 2001 — shows no sign of slowing.
Since Northern Virginia's economy has remained strong, people will continue to want to live here, Fuller said.
Loudoun County is already a favorite place for new residents and it will only remain so, especially as more businesses locate here and make it easier to avoid a commute to Fairfax or beyond.
The Metropolitan Washington Council for Governments has predicted that Loudoun's population will grow by 173 percent by 2030.
"Loudoun County has an awful lot to offer people," Fuller said.