Ask GGW: Is living farther out a bad investment?

Reader Frank, currently a teacher in DC who lives in Annandale, writes in with a question:

We are considering a move to Haymarket, Virginia. From what we can see, it’s a nice small town with some rural outlying areas, but isn’t so far removed from civilization that we’d feel isolated.

As a teacher, I am pretty mobile. Currently we live in Annandale and I teach in DC. The mortgage is hard to pay with a one-salary teacher household! We might stay if we think we can afford it in the long run.

My wife and I have a 2 year old daughter, and if we relocated we’d be looking for a place where we can have a little more land and more house for a reduced cost of living than Northern VA, a good school system, and in a place which isn’t too isolated from humanity.

The drawback (and this is where my question for you is) is that it is on the edge of the suburban “sprawl” outside Gainesville, etc. We fear that if the population shifts to being more urban in the future, our property values would decline.

Do you see the suburban crawl continuing, or slowing down given that some are starting to move back into DC for the first time in a long time? How might that affect property values? Will there be public transit out there in our lifetimes?

What say your crystal ball? What might some of the potential drawbacks be of living there in 5 or 10 years?

We posed the question to the Greater Greater Washington contributors. Here are some excerpts from their responses.

Canaan Merchant: Short term: There are some nicer developments in Haymarket that incorporate some new urbanist elements. The village center is very low density but has a nice-ish streetscape compared to other areas of Prince William County and the potential is there for density in the center.

Longer term: That area specifically will still be growing outward AND upward. Prince William County has what’s called a “rural crescent” but Haymarket is not inside of it. The only thing that would stop development would be a collapse in demand. But transportation improvements (both for cars and public transportation) are slow coming, so expect a lot of growing pains along with that growth. You’re just past where 66 cuts down from 8 lanes to 4 and US 15 can get mighty congested as well with train tracks and 66 presenting a lot of barriers to connectivity. So in terms of transportation, its bad now and poised to get worse before it gets better.

There is a long range VRE plan of adding a Haymarket stop which could help spur some TOD which would help with the property values aspect. But, coming from someone who is neither a realtor or financial planner, I’d say if you’re looking to stay there for the long haul then you should worry less about the property values and more about a place that can shelter your family and fit your lifestyle.

Dan Reed: Most of the “end of the suburbs” writing as of late reluctantly acknowledges that yes, some suburban areas will retain their value in the future. The question is which ones, since it does look like the “suburban crawl” is slowing and there may only be so much investment to go around.

Already-affluent places like Potomac or McLean will probably do just fine, as will downtowns like Bethesda or Silver Spring. Ditto for places that are shifting to a more urban character, like Hyattsville, Wheaton, or Merrifield. But it’s less clear far outside the Beltway, beyond Metro stations, and on the less prosperous eastern side of the region, which is already far from major job centers and struggles with poverty and disinvestment.

Haymarket is probably better positioned than many communities because it has a small-town fabric and isn’t as far from Northern Virginia job centers as, say, Stafford County. But it’s far enough out that I can’t see it being a hot real estate market when gas costs $6/gallon.

Dan Malouff: A quick look at Google Maps satellite imagery tells me Haymarket is already pretty sprawly. The historic main street is cute but tiny. The vast majority of houses are in new suburban-style subdivisions. It will eventually, someday, have a VRE station, but I don’t think there can be any denying that Haymarket these days is classic car-dependent sprawl.

Of course, a lot of people like that. Nobody at GGW thinks urbanism is for everybody. But the assumption that property values will decline if the population shifts to become more urban is almost certainly wrong. Property values go up when there’s more demand to use land. That’s why a house in Annandale is more expensive than a house in Haymarket. The only risk to property values in Haymarket is if sprawl declines and the land reverts to rural. If the sprawl continues, property values will rise.

So will the sprawl continue? It’s hard to predict. Northern Virginia sprawl has certainly slowed down a lot since the heyday of the 1990s. When the housing bubble burst a few years ago, Prince William was among the hardest hit places in the DC region. And in the future, when the boomer generation retires and millenials drive the development market more, it’s conceivable there could be another even bigger crash out there in the distant ‘burbs. But that would be a pretty significant change. If you’re happy living out there, then go ahead and live out there.

Just don’t assume it’s definitely going to be a lot cheaper.

Douglas Stewart: It will be a very long time before transit comes to 66 — and that may be a good thing. While the state is studying improvements along I-66 outside the Beltway and transit is part of the mix, communities along 66 west of Fair Lakes aren’t showing many signs of developing supportive land uses for transit.

Since (or before) the fight over Disney in the early 1990s, Haymarket has been a crossroads community, having to decide whether it will preserve its historically rural character or be sucked into Northern Virginia sprawl. It has experienced a lot of residential development in the past two decades. There has long been a lot of pressure to expand Route 15. At the same time, the town has been working on a plan and has gotten some funding to revitalize its urban core. The push-pull of poorly planned growth and expanded highways vs. more orderly growth and preservation will continue in this part of Prince William and nearby Fauquier.

Stay in Annandale.

Jim Titus: Can you move from DC to Haymarket and maintain the same income? Does the place lift your spirits more than Annandale? If so, then it might make sense to move there.

But don’t base your decision on someone’s forecast of real estate prices. People can not predict whether Haymarket or Annandale home prices will rise faster, any better than they can predict which of two common stocks will have the higher return.

Also: This all assumes that Frank doesn’t have to commute into DC, and would switch to teaching somewhere in Northern Virginia. Some contributors added that for someone with a job that still required commuting into DC, the added commute of Haymarket versus Annandale, both in time and cost, is a significant extra disincentive.

Dan Malouff wrote, “Surely housing is less expensive there, but transportation is going to cost so much more that the overall cost of living may well be higher in Haymarket. Here’s more info on that.

What advice would you have for Frank?