First of two articles
The most attractive thing about the run-down Arlington condominium David Larrea bought at the end of 1999, he says, was its price: $65,000.
Five years later, the broken windows have been replaced; he has painted his living room wine red; and values throughout the plain, five-story brick complex have soared 67 percent from a year ago. Larrea's home, according to the latest round of property assessments, is worth four times what he paid for it.
Cathy Laakso of Loudoun paints home murals to earn money to cover her mortgage and taxes. "It means I have to paint a lot of walls," she says.
(Jahi Chikwendiu -- The Washington Post)
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Thirty miles west of Larrea's end unit, in an upscale subdivision atop a hill in Loudoun County, Brian Rhoa is also seeing stunning gains in the value of the 3,000-square-foot home he bought for nearly half a million dollars. The value of the 64 houses in Rhoa's neighborhood jumped, on average, 49 percent in the last year.
Larrea, a musician who emigrated with his wife and two sons from Bolivia in 1993, and Rhoa, a nonprofit administrator who moved from the San Francisco Bay area eight years later, have leading roles -- and intimate stakes -- in the region's housing price boom.
The average assessed value of a home in Northern Virginia has roughly doubled since 2000, according to official figures from the region's five largest jurisdictions and estimates based on recent real estate trends, with values in some counties lagging slightly and others inching higher. Assessments have been released in Arlington and Loudoun, and notices will arrive in Fairfax, Prince William and Alexandria mailboxes in the coming weeks.
Economists credit cheap loans, a limited housing stock and burgeoning job growth -- spurred by federal government spending -- for fueling the upsurge. The resulting new tax dollars have fueled generous increases in spending by local governments, and sharp debates over philosophy and priorities.
Steep rises in condominium prices, attractive urban development near Metro stops and the convenience of living inside the Capital Beltway have pushed up prices in areas closer to Washington somewhat faster than elsewhere in Northern Virginia over the past five years. Assessments in Arlington County, for instance, have soared 125 percent since 2000.
In many cases, less-tony neighborhoods have experienced the sharpest increases. Homes in South Arlington, where prices started from a lower baseline, have shot up the fastest.
Although local officials base assessments on a variety of factors, including home sales in neighborhoods, proximity to commercial areas and transportation links, and any property improvements, common forces drive the market as a whole.
"Job growth is causing demand to be strong. Supply is low, and interest rates are low. The confluence of these three factors is what's keeping the real estate market strong," said Ed Long, Fairfax County's chief financial officer, who grew up in Alexandria and has eyed Northern Virginia's market undulations from his perch in Fairfax since the 1970s.
Sharp assessment increases have come to seem routine. But the implications of those combined increases are far-reaching, shaping everything from government spending and tax bills to the affordability of housing and the way families pursue their dreams.
The steep rises have created an urgency -- some say frenzy -- among potential buyers.
"It's the sort of panic thing . . . like musical chairs," said Charles M. Page, Arlington's deputy assessment chief. "You don't want to be left without a chair."
