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Housing Affordability Crisis and Proposed Solutions by Local Governments in Northern Virginia

AS.470.673.81.SP24 Data Visualization
10 May 2024

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Introduction

Affordable housing shortage is a huge issue in several counties of Northern Virginia (NOVA). The 5 Counties selected for this portfolio are Alexandria, Arlington, Fairfax, Loudoun and Prince William County. One of the proposed and implemented solutions for this issue in Alexandria County is zoning changes- changing single family home zoning codes to multi-family zoning and apartment complexes thus lowering the cost of housing. “Alexandria currently has 80,000 housing units; plans approved in the past two decades allow for over 50,000 additional units, of which about 15,000 units have their required approvals but are not yet built.” (City of Alexandria, 2023) The goal of this project is to show the current situation of the 5 Counties, measuring median house income, median house value, housing units, population, mean travel time to work, population change, persons in poverty, employment change, and to determine what policies are proposed by the local governments in the 5 counties and analyze the possible impact these policies may have in the county.

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Research Overview

The goal of my research was to investigate housing affordability in Northern Virginia through the utilization of publicly available federal and county housing and economic data. The research includes:

Historical Policies and Their Results:

Examination of past policies related to housing and their impact on affordability in Northern Virginia.

Analysis of the outcomes of these policies to understand their effectiveness and implications for the current housing landscape.

Economic and Housing Affordability Analysis:

Utilization of economic data to assess the current state of the housing market in Northern Virginia.

Evaluation of housing affordability metrics, including home prices, income levels, and rental costs, to identify trends and challenges.

Proposed Policy Changes:

Development of recommendations for policy changes aimed at addressing housing affordability issues in Northern Virginia.

Consideration of potential strategies and interventions based on the findings of the economic and affordability analysis.

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Mortgage Rates and Home Sales 2016-2024 in Northern Virginia

The trend observed indicates that the peak of homes sold per month typically occurs two months after the lowest recorded mortgage rate. This delay can be attributed to the lengthy process involved in purchasing a home, from making an offer to finalizing the sale. The plot depicting home sales illustrates clear seasonality, with fluctuations corresponding to different times of the year. However, since the rate hikes in 2022, there has been a noticeable decline in home sales. This decline can be attributed to the increase in mortgage rates, which not only reduces home affordability for potential buyers but also dissuades current homeowners from selling. They may be reluctant to give up their existing low mortgage rates, which they secured previously and may not be able to obtain again when purchasing a new property.

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Unemployment Rate and House Price Index in Northern Virginia

A notable inverse correlation between the unemployment rate and Home Price Index (HPI) is evident. A decrease of 4% in unemployment within Prince William County led to an 8.5-point increase in the HPI over a period of just two years, indicating a rise in housing costs, decreasing housing affordability for the people of Northern Virginia even further.

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Commute Time to Work

The data reveals a significant reliance on personal vehicles, with minimal utilization of public transportation options. Despite the urban setting, a large portion of the population is dependent on a privately owned vehicle. This dependency comes with financial implications, particularly regarding vehicle maintenance costs and associated loans. According to a recent report by Lendingtree, the average monthly car payment stands at $738 for new vehicles and $530 for used ones. These expenses weigh heavily on individuals and families, reducing their purchasing power and impacting their financial well-being.

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Arlington County Available Housing Units and 5 Income Categories

The data set examined in this project is an Arlington County data set with 53 variables and 63 districts.The first plot examines available housing units per district in Arlington County. This data shows that the was majority of housing units are rental units, and districts with majority of owner units have very few housing units total. An added value to this plot should be the cost of rental properties and average mortgages. The second plot is a bar plot that shows 5 income categories.The category that is most important to this research is the 0-50’000 USD income category. The poverty line in Arlington County according to Arlington Community Foundation is 42’690 USD. There is not a divide in data that meets this income, but it is possible to estimate that more than 40’000 people are at risk of poverty with income bellow 50’000 USD. According to Arlington Community Foundation there are 24’272 people currently in poverty in Arlington County. People that are at risk of poverty are almost double this number.

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Arlington Committed Affordable Housing Units

Arlington County’s commitment to integrating affordable housing within new developments is a step in the right direction, but the current income limits set for these units may not align with the financial realities of the median household. This underscores the challenge of balancing development goals with the need for genuinely affordable housing. To address this gap, officials could reassess affordability criteria to better reflect local income levels. Achieving this balance will necessitate a collaborative effort among government bodies, developers, and community stakeholders, ensuring that Arlington remains a place where residents of all income levels can thrive.

Bellow the plot is a link to an interactive plot with all the affordable housing complexes in Arlington County 2000-2020.

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Alexandria Zoning

The above map illustrates the different zoning categories of Alexandria City. Majority of city is zoned for residential housing, and most of the residential housing is single family housing. Alexandria County poses a significant challenge to housing affordability by restricting the construction of new multi-family housing developments. The City Council of Alexandria has implemented various zoning changes, but all of the new developments are planned several years into the future, while the issue of housing affordability is increasing.

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Proposed Solutions to Increase Affordability

Zoning Code Amendments:

Approved by the Alexandria City Council at the end of November 2023, the decision to transition zoning codes from single-family housing to multifamily housing marks a significant step towards expanding housing options and increasing density. However, implementation of this change is expected to span several years before its full realization.

Affordable Housing Mandate:

Implement an increase in the mandated percentage of affordable, income-based apartments in new development projects. This measure seeks to enhance accessibility to housing for low and moderate-income individuals and families, addressing affordability challenges in the region.

Transit System Enhancement

Invest in improvements to the transit system infrastructure to reduce commute times and facilitate easier access to employment centers. By enhancing public transportation options, individuals can live further from their workplaces without experiencing significant transportation burdens, promoting more equitable access to housing opportunities across Northern Virginia.

Apartment Size Optimization

Consider revising regulations to allow for the construction of smaller-sized apartments, thereby increasing the overall apartment count within developments. This approach aims to maximize land utilization efficiently while catering to varying housing needs and preferences within the community.

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Resources