On March 1, 12 town went on sale in Bethesda. They were modest homes - most of them were two stories high, with combined living room-dining room, pile carpeting and standard department store chandeliers.
Ordinary, to be sure. Yet these homes attracted some 600 potential buyers that day because this was Montgomery County, where the average house costs more than $70,000. And these houses cost no more than $35,490.
So great was the demand that county officials had to schedule a lottery drawing to select the 12 lucky families who will live in the houses.
The 12 houses are Montgomery County's version of moderately priced dwellings. And they are moderately priced; the 75 adjacent town houses, with almost idential floor plans, sell for between $69,000 and $88,000. The lower priced homes were made available by the developer under a county law that requires that 15 percent of the homes in projects of 50 or more houses be set aside for moderate pricing.
In the past four years that the county has had the law, officials have never had this kind of a response. County Housing Office Director Eugene Sieminski expected interested buyers to saunter casually into the Housing Office the morning that the town houses went on sale.
Instead, he got phone calls over the previous days from people asking where they should station themselves the night before the sale to be first in line.
"People were going to camp out here," said Sieminski. "We were about to go into a marketing effort to raise consciousness about the units andthen Bethesda Court (the project's name) came along. It has been a tremendous assist."
"I'm thrilled about this drawing," Montgomery County Council President Elizabeth Scull said cheerfully. "It shows all those developers who've been pooh-poohing moderately prived dwelling units, saying no one wants them, that there is some interest in them."
Of all the 250 moderately priced houses that builders have constructed under the 1974 law in Gaithersburg, Damascus, and Darnestown - the Bethesda Court project has the least amount of units available and the most people interested.
Sieminski ascribes that interest to "location of the town houses and a general misunderstanding. These are not the same as the $88,000 town houses." In fact, developer Nathan Brisker says that the regularly priced town houses have 1 1/2 more bathrooms than the moderately priced ones have.
The more expensive town houses also have more expensive carpeting and cabinets, according to Brisker. They also have basements, dishwashers and, in some fireplaces. The moderately priced houses have none of those features.
Another factor that makes the houses so popular is the resale value. "People want to use the moderately priced dwelling units as a springboard to a down payment on another house," said Sieminski. After they buy their houses, he said, "they spend about 10 minutes putting in cabinets and call it an improvement, and then they try to sell at a higher price."
The office of housing, however, regulates the resale prices of the houses for five years after they are built.
There are over 4,000 housing units subsidized by federal and state programs in the county. Generally the income levels of people eligible for those units are lower than the income levels of those applying for the Montgomery units.
But the median income for those applying for the Bethesda Court town houses is $13,300, according to Sieminski, which is too low to get financing. "And a lot of those people are applying for the three-bedroom town houses. It takes a $15,000 to $17,000 income to finance these town houses. We don't know what people's assets are and we're not asking. But for a lot of those people at the lottery, it's going to be congratulations, and pictures and they'll apply for a loan and they won't have the sufficient income."
Some developers, according to Sieminski, say they pass along the cost of the moderate house to their higher priced houses. "The project overall has to help finance the moderately priced houses," says Bethesda Court developer Nathan Brisker.
Brisker said the moderately priced houses, without the constraints of the county law, should cost another $10,000 to 15,000.
Sieminski said the applicants for the houses were mainly "younger people without families and with friends, young couples, and older people looking for smaller homes. The thing that really hit me was the number of singles in their early and middle 20s interested in the housing."
For a single person applying for a moderately priced house, the maximum is $14,200.
"I also noticed a number of Oriental and Indian names on the applications," said Sieminski. "I noticed that we aren't getting many blacks."
Sieminski said he had calculated that 65 percent of the applicants were one or two persons households. The maximum income for a family of two, applying for the housing is $16,200.