Key Facts: The region's housing prices remain 124% higher today than they were in 1999. However, during the same period, the median income only rose 21%. In 2000, 64% of the housing stock was affordable to median income households; in 2005, the number dropped to just 7 percent. A median-income family would now need to spend 54% of their income to purchase a median-priced home. AFFORDABLE HOUSING POSITION: The Northern Virginia Association of REALTORS (NVAR) supports initiatives to help solve Virginia's housing problems. It is committed to the development and preservation of the nation's housing stock and to preserving the dream of home ownership to the greatest number of people possible. NVAR is opposed to unreasonable land use restrictions that would lead to increased costs for housing. BACKGROUND: A continuing supply of adequate and affordable housing is necessary to sustain healthy economic growth in our region. According to Dr. Stephen Fuller of George Mason University, the region's increasing job sprawl makes it more difficult to live near work. Thus, people are forced to move further out, once again perpetuating sprawl. Several localities in the Washington metropolitan region have implemented policies that restrict development in a number of ways. Proposals to require large lots, for instance, serve to increase the cost of homes; force people to move further out which exacerbate the problem of sprawl; and decreases the affordable housing stock. Requiring impact fees or cash proffers on new development also increases the cost of already expensive housing. These restrictive tools raise the price of housing and diminish the opportunity for home ownership. In the past seven years, the Washington area has experienced a dramatic increase in home prices. Despite the recent softening of the real estate market, the region's housing prices remain 124% higher today than they were in 1999. However, during the same period, the median income only rose 21%. In 2000, 64% of the housing stock was affordable to median income households; in 2005, the number dropped to just 7 percent. A median-income family would now need to spend 54% of their income to purchase a median-priced home. The demand for housing in the area is estimated at 47,700 units per year. Even with rising inventory of existing homes, the current housing supply only stands at 32,600, ensuring that the housing affordability crisis will continue. A worker in the City of Alexandria needs an annual income of $108,858 to afford a condominium at the average assessed value and an income of $58,160 to afford a two-bedroom market rate rental unit. Arlington County estimates that of the 39,618 affordable units in the county, 2,648 rental units were lost in 2005 - roughly 6% of the multi-family rental stock. In addition, the 2006 average countywide rent increased by roughly $50 per month to $1,480, an increase of 3% over 2005. The lack of affordable housing greatly affects service workers. In 2005 only 30% of Fairfax County?s police and firefighters lived in Fairfax. The average mortgage payment in the City of Alexandria ($2,265) consumes 81% of an elementary school teacher's monthly income. According to a survey conducted by the National Association of REALTORS, 62% of people say that they worry the cost of housing is getting so expensive that teachers, firemen, police and others on whom we depend cannot afford to live in many of the same areas where they serve, protect, teach, or work in. STATUS: Since 2004, NVAR has served on the Fairfax County Affordable Housing Preservation Action Committee. One recommendation approved by the committee was dedicating one penny of the local property tax rate to preserve existing affordable housing units. The Board of Supervisors included this measure in their FY 2006 and FY 2007 budgets and leveraged those funds to preserve over 1300 affordable units in the County. The City of Alexandria also dedicated one penny of the property tax rate for affordable housing in their FY 2006 and FY2007 budgets. As of June 2006, the City has 181 affordable units pledged and $14.3 million in committed monetary contributions. Approximately 60 of these units are located in the Potomac Yard redevelopment project, which uniquely combines ADU units over a newly constructed City fire station. Arlington County formed an Affordable Housing Roundtable in October 2005 and reached an agreement with developers on affordable housing contributions and density bonus guidelines. In 2006, the General Assembly approved this compromise in SB 273 (Whipple). The bill authorizes the County to establish affordable housing contributions from developers as a condition of the governing body's approval of a special exception application for residential, commercial, or mixed-use projects with a density equal to or greater than 1.0 FAR. Under the bill, the provisions of the ordinance would allow the developer to provide on-site Affordable Dwelling Units, off-site Affordable Dwelling Units, or a cash contribution to the County's affordable housing fund in lieu of providing the units. Recently, the Arlington Partnership for Affordable Housing (APAH) purchased the Courthouse Crossing development which was expected to revert to market rate. The new affordability period will be 60 years. In addition, the 51 units that were originally market units will now be committed affordable units. In 2007, the Virginia General Assembly approved HB 2010 (Suit)/SB 955 (Quayle). HB 2010/SB 955 rewrites Code section 15.2-2305 to increase density bonuses available to developers that provide affordable units to the locality. However, the General Assembly defeated SB 966 and SB 967, measures that would have dedicated revenues to the Virginia Housing Trust fund. Monies from this fund would have been used to support innovative housing projects and low and moderate income housing projects that are located in areas experiencing extreme shortages of such housing. The 2007 General Assembly did approve study resolutions SJ 366 (Whipple), which directs the Virginia Housing Commission to study state incentives for developments that locate affordable housing near identified employment centers, high-density districts, and transit areas; and SJ 365, which will examine the feasibility of increasing the statutory options and tools that are available to localities to develop more innovative housing policies. Also passed was HB 2727 (Englin)/ SB 968 (Whipple), which allow elderly or disabled tenants in a conversion condominium the ability to assign their purchase rights to a housing authority or non-profit.