Young professional making $50k a year.. (Laurel: renting, mortgage, house)

[Zimar]

Originally Posted by saigafreak

I'm not talking about homeownership, but on that note I believe DC's bubble is finally about to burst very soon with imminent FedGov cuts, just a prediction though but I was right back when I called for a national bubble burst in 2005.

I've heard this a lot, but I wonder if it is true. I honestly do not know what drives the prices here so high. If the federal budget gets cut, is it going to effect the government contractors, lobbyists, and lawyers who make the big money? Or do they have too much of a hold on the government or not that big of an effect on real estate demand? If a bunch of Federal workers who make incomes in the high five figures lose their jobs, is *that* going to bring prices down? I honestly don't know. A lot of federal agencies froze hiring for a couple of years, and that didn't seem to have much of an effect here. It seems just as likely that Washington is not like places like Florida and Arizona and Las Vegas, where prices crashed, and more like cities in Europe, where real estate is atrociously expensive for unknowable reasons (I watch a lot of House Hunters International). Then again, I don't know a dang thing.

[Tiger Beer]

Originally Posted by Zimar

I've heard this a lot, but I wonder if it is true. I honestly do not know what drives the prices here so high. If the federal budget gets cut, is it going to effect the government contractors, lobbyists, and lawyers who make the big money? Or do they have too much of a hold on the government or not that big of an effect on real estate demand? If a bunch of Federal workers who make incomes in the high five figures lose their jobs, is *that* going to bring prices down? I honestly don't know. A lot of federal agencies froze hiring for a couple of years, and that didn't seem to have much of an effect here. It seems just as likely that Washington is not like places like Florida and Arizona and Las Vegas, where prices crashed, and more like cities in Europe, where real estate is atrociously expensive for unknowable reasons (I watch a lot of House Hunters International). Then again, I don't know a dang thing.

My personal guess is it's the gov't contractors, lobbyists, and lawyers who are making the big money.

If gov't workers do lose there jobs, and there are less gov't workers to do what the gov't needs to do, than it just means the gov't must hire more temp workers at higher wages to do the same thing, and a whole heck of a lot more contractors.

[saigafreak]

Originally Posted by bonnielisabeth

Adelphi=not so nice parts of Durham, in my opinion; PG county prices are still going down and have not hit bottom yet. Prices in the "nicer / safer / better schools" areas of Montgomery County seem to have stabilized. Prices in Bethesda/Chevy Chase seem to be up from peak (i.e. I can no longer find single family homes in our price range there .

We moved here from the Raleigh area a couple of years ago and the same _exact_ house by the same builder (1990s era) in a less-nice area is 500K here(house in NC sold for 230K). In theory the prices are 30% higher, but reality is that if you want a single family home in a comparable area with comparable amenities/crime rate/schools I have found the price to be at least 50% more and usually more like 100% more than in Raleigh. But, I wanted a condo in a higher crime area, I would be able to find a deal.

Rent for 3 bedroom townhome in decent area with so-so schools=currently paying 2000 per month

Insurance for 2 cars over 8 years old: 1300 per year (I have shopped around, threatened to cancel, etc... but can not find a lower rate; we have not had an accident or ticket in 15 years. But, people here drive like they are insane, so I understand the increase.)

The original poster could definitely live here on 50K, but would need to have roommates or rent a basement to save anything.

Do you regret your move from Raleigh? My other job option is IBM @ RTP. The work is less interesting and certainly less stable than my offer up there. It's good to hear someone from Raleigh because I have this bad feeling that we're going to regret moving since we love the area here so much.

[saigafreak]

Originally Posted by Tiger Beer

My personal guess is it's the gov't contractors, lobbyists, and lawyers who are making the big money.

If gov't workers do lose there jobs, and there are less gov't workers to do what the gov't needs to do, than it just means the gov't must hire more temp workers at higher wages to do the same thing, and a whole heck of a lot more contractors.

But if the government is forced to cut back, they will not have the resources to hire workers whether they are perm or temp. This is what I'm predicting will happen. It's self-deprecating because my offer is a FedGov one, but my area is more of a niche field that is high in demand rather than a standard bureaucrat.

[saigafreak]

Originally Posted by Zimar

I've heard this a lot, but I wonder if it is true. I honestly do not know what drives the prices here so high. If the federal budget gets cut, is it going to effect the government contractors, lobbyists, and lawyers who make the big money? Or do they have too much of a hold on the government or not that big of an effect on real estate demand? If a bunch of Federal workers who make incomes in the high five figures lose their jobs, is *that* going to bring prices down? I honestly don't know. A lot of federal agencies froze hiring for a couple of years, and that didn't seem to have much of an effect here. It seems just as likely that Washington is not like places like Florida and Arizona and Las Vegas, where prices crashed, and more like cities in Europe, where real estate is atrociously expensive for unknowable reasons (I watch a lot of House Hunters International). Then again, I don't know a dang thing.

You can have diplomats moving into DC, similar to the upper east side of NY. Europe opened up to more customers via the EU and open borders for EU citizens to live anywhere in Europe. As for the folks who think it "can't happen here": People said LV couldn't crash because of the casinos and the wealthy CA weekenders. People said FL couldn't crash because it's so beautiful, sunny, and people enjoy tax free living. It's just a prediction, not set in stone. But, we're excited about the prospect of scooping up a good deal in 3-5 years once the Fed is forced to cut back drastically.

[saigafreak]

Originally Posted by Tiger Beer

I hope you're right!

In most other areas, the cost of housing was way above people's income levels. So, they absolutely had to come down.

With higher wages in DC, and the housing prices still not coming down, I've been wondering about that issue.

Patience, grasshopper. That is another reason why we intend to sit on the fence for a while once we arrive.

[badchad]

Originally Posted by Tiger Beer

My personal guess is it's the gov't contractors, lobbyists, and lawyers who are making the big money.

And the large number of federal workers making the "medium" bucks. Many agencies in the gov. moved through a relatively large hiring push within the last 3-4 years, just PRIOR to the housing crash. This means that by now, most are career employees. They really "can't" be fired or cut due to the strength of the union.

The feds have already frozen "cost of living" increases, for the last three years, and have been flirting with restructuring retirement. The bottom line is that these people aren't going anywhere.

I tend to agree with you that the gov't isn't simply going to "cut back" and allow itself to crumble. As long as the gov't is functional, there will be a large amount of skilled, well-paid employees in the area supporting high prices. Prices fell in DC right along with the rest of the country. DC is a major metro area, and they are unlikely to fall much further.

[Jobworkinger]

Originally Posted by badchad

And the large number of federal workers making the "medium" bucks. Many agencies in the gov. moved through a relatively large hiring push within the last 3-4 years, just PRIOR to the housing crash. This means that by now, most are career employees. They really "can't" be fired or cut due to the strength of the union.

The feds have already frozen "cost of living" increases, for the last three years, and have been flirting with restructuring retirement. The bottom line is that these people aren't going anywhere.

I tend to agree with you that the gov't isn't simply going to "cut back" and allow itself to crumble. As long as the gov't is functional, there will be a large amount of skilled, well-paid employees in the area supporting high prices. Prices fell in DC right along with the rest of the country. DC is a major metro area, and they are unlikely to fall much further.

I'm moving to the area, but looking closer to Baltimore then DC simply because the cost of living is lower living closer to 695 then 495. If my company had its offices in NoVA, I probably wouldn't make the move, plain and simple.

[saigafreak]

Originally Posted by Jobworkinger

I'm moving to the area, but looking closer to Baltimore then DC simply because the cost of living is lower living closer to 695 then 495. If my company had its offices in NoVA, I probably wouldn't make the move, plain and simple.

Are you taking into account mileage you'll be putting on your car(s), gas, etc? The amount of time you'll be spending in traffic over time? I know, classic commuting trade-off questions, but make sure you take into account the possibility of $5-6/gas in the near future as a way to properly hedge. If you buy further out and gas increases, property value must fall as a result. No matter how desirable the 'burbs are, if it causes families to stretch their budgets, they'll take that into consideration when deciding to buy a home there. I've seen the same thing happen where I'm moving from, both times when gas rose to nearly $4/gal.

[Jobworkinger]

Originally Posted by saigafreak

Are you taking into account mileage you'll be putting on your car(s), gas, etc? The amount of time you'll be spending in traffic over time? I know, classic commuting trade-off questions, but make sure you take into account the possibility of $5-6/gas in the near future as a way to properly hedge. If you buy further out and gas increases, property value must fall as a result. No matter how desirable the 'burbs are, if it causes families to stretch their budgets, they'll take that into consideration when deciding to buy a home there. I've seen the same thing happen where I'm moving from, both times when gas rose to nearly $4/gal.

I have a car that gets about 31-35 miles to the gallon, and and have found some reasonably priced apartments($850 to 1000/month including some utilities) in and around Downtown Laurel that are in safe areas and within a 4-6 mile range(no interstates) to my work location in Skaggsville. Even still, I'll be putting in Overtime and making sure to work hard once up there so that I can rise my income further.

Also as far as groceries are concerned, I'll be sticking to Costco, Trader Joes's, and Aldi, and also look into utilizing Direct Energy for any deregulated utilities that may save me some $ from buying direct from BGE.