OLYMPIA, Oct. 4, 2007 – A survey released today by the Washington Association of REALTORS® shows that 67 percent of Washington residents are concerned about the steady increase in home prices, up about 65 percent over the last five years.
While home prices have increased rapidly, over the last five years wages have crawled forward at about the rate of inflation. The result is an affordability gap that is shutting middle-wage workers out of home ownership, according to Steve Francks, the Chief Executive Officer of the Washington Realtors. Francks added that Washington’s real estate market has seen year-to-year increases in home prices every quarter since 1995, thanks to a steadily increasing population.
“Strong economic growth has led to increased population growth, which means more people needing a place to live. At the same time, local rules and regulations designed to ‘manage’ population growth inhibit the market from meeting that demand,” said Francks. “The result is tremendous demand for median-priced homes that heavily depletes the variety of home choices available in the price range most people need.”
The survey was conducted Sept. 4 through 6, 2007, and polled Washington residents about their attitudes on growth and housing, and other issues. Seventy-one percent would like to see government place a higher priority on making housing more affordable. Of the 400 respondents 68 percent agree that government should allow a wider variety of home choices and 64 percent acknowledge a housing affordability crisis caused by the lack of homes available to meet demand. Two thirds said concentrating growth in urban and suburban areas would allow people to live closer to where they work, reducing highway congestion.
“Washington policy makers should connect the dots,” said Francks. “They need to understand how the growing demand for homes affects affordability. Without a variety of home choices to meet that demand, our prices keep escalating. People drive further away from their jobs to find a home they can afford and that affects a host of other quality of life issues: more traffic congestion, diminished time with our families, environmental degradation and sprawl. Our challenge is to get policymakers to make the connections and plan to accommodate that growth to preserve our quality of life.”
Residents surveyed said they would welcome expanding the variety of home choices in their communities if it did not overcrowd roads. People support meeting the demand for homes with traditional single family homes, cottages and town homes, and they want to protect parks and open space. Respondents also said that it should be a priority to make homes available in the price range that is affordable to median-wage workers that serve communities, including professions such as teachers, firefighters, and police officers.
Francks noted that the survey news arrives in the midst of confusion over the status of the state’s mortgage market. While so-called sub-prime mortgages represent about 20 percent of all home loans nationally, they are just six percent of home loans in our state. In Washington state less than 1 percent of all home loans end in foreclosure – about the same as ten years ago. Last week the state Economic and Revenue Forecast Council reported that tax collections have been $75 million above forecast levels in the past two months primarily because of the continued strength of housing and construction sales.
“Clearly, the challenge in this state is not sub-prime mortgages, but a lack of affordable, attractive housing choices that middle-class families can afford,” said Francks.
In addition to addressing escalating home prices, residents identified the following as top concerns:
- Improving public education
- Stopping wasteful government spending; and
- Improving traffic, congestion and other transportation problems
The statewide survey contacted 400 residents and has a margin of error of plus or minus 4.9 percent.
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For more information, please contact Barb Lally, 943-3100, ext. 122.
“REALTOR® is a federally registered collective membership mark which identifies a real estate professional who is a member of the NATIONAL ASSOCIATION OF REALTORS® and subscribes to its strict Code of Ethics.”