Thursday, September 27, 2007

Montgomery County Maryland Houses Start at $1 Million Plus

My family won't be moving to Montgomery County any time soon, because we can't afford the price of housing.
In a trend Montgomery County officials called shocking, the median price for a newly constructed single-family detached home in Montgomery rocketed to a record high of $1.13 million in the first quarter of this year, according to government data released yesterday.

The figure, up from $881,600 last year, underscores the escalating cost of new construction in the Washington region and is a troubling sign for officials seeking affordable housing solutions.

Although specific home sales data were not available for all jurisdictions in the region, it appears Montgomery has the area's most expensive new homes. The median price of new single-family homes in Fairfax County was $965,200 last month, according to county data.
Note that the number is a MEDIAN as opposed to an average. That means that half of the new homes in Montgomery Count cost more than $1.13 millian and half cost less.

Two explanations I can offer. The first is that Montgomery County has a lot of high end housing being built and not much in the middle and lower price ranges. Compare the $1.13 million for a new single family detached house with the $540,000 price tag for an existing single family home. That is simply the market working itself out.

The second reason is the result of governmental policies skewing housing costs. Montgomery County's secular religion regarding development is "Smart Growth" plans, which drive up the cost of housing because such policies articially inflate the cost of homes by limiting teh supply and thus builders are able to charge more because demand is artificially high. demand.

Still, seven figures for a house seems ludicrous.

1 comment:

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