The housing boom in Virginia is over for now, but prices still are high enough in some areas that the Virginia Center for Housing Research is suggesting employers consider providing housing benefits when hiring.
In a study funded by the Virginia Housing Development Authority and conducted by the Virginia Tech-based housing research center, officials found 25 percent of employers surveyed in Northern Virginia believed the cost of a housing benefits program eventually would be offset by savings in recruiting, training and employee retention.
The survey focused on problems experienced by workers earning less than $35,000 in what is one of the more expensive housing markets in the country.
Figures from a separate survey show the average selling price of a home in Virginia fell 2 percent early last year due to the recession and to natural demographic changes.
Nonetheless, nearly 50 percent of the employers surveyed in Northern Virginia said they have lost employees because of high housing costs or the heavy toll of commuting.
"Seventy percent of the employers surveyed experienced problems in recruiting employees earning below $35,000 due to housing and commuting problems in the region," according to a summary of the Virginia Tech report.
In addition, the report said, "there was substantial agreement that long commuting hurts productivity."
The report also said that, although only 9 percent of those surveyed indicated a willingness to participate in developing an employer-assisted housing program with the state, there also was evidence that 25 percent to 40 percent might accept the right kind of program.
The study also noted that programs that go beyond simple relocation assistance have been growing in recent years. Some firms have started group mortgage discounts, closing-cost assistance and programs that offer down payment and home improvement loans at below-market interest rates. A lawyer for the first public housing agency taken over by federal officials was sentenced to probation this week in Newark, N.J., in connection with a scheme to steal tax dollars that should have gone to help shelter the poor.
The case stemmed from a nationwide investigation into the pilfering of public money at housing projects funded by the Department of Housing and Urban Development.
Augustus Michaelis, 76, the former chief lawyer for the Passaic Housing Authority, admitted that he was paid $150,000 for services he didn't perform. In exchange, he kicked money back to Paul Marguglio, the agency's executive director, who has pleaded guilty to conspiracy and tax evasion and is to be sentenced March 20.
Michaelis was sentenced to three years probation, fined $5,000 and ordered to perform 300 hours of community service.
He was the fourth person sentenced for corruption at the agency. None received jail time.
Although Michaelis admitted to the kickback scheme, he was charged and pleaded guilty only to lying to Congress during a hearing into the Passaic projects and to helping Marguglio avoid paying income taxes.
Michaelis asked U.S. District Judge Maryanne Trump Barry for mercy, saying "This is the first mistake I've made in nearly 77 years. Words cannot adequately describe my remorse. I beg to be forgiven."
HUD Secretary Jack Kemp ousted Marguglio and other top officials of the Passaic authority in January 1990, and federal agents confiscated records. An audit disclosed more than $1.6 million in financial irregularities at the agency. Taisei Corp., a Japanese construction firm, is planning a futuristic city in Japan that would be shaped like Mount Fuji with a base 3.6 miles in diameter, according to Real Estate Perspectives, a newsletter put out by the Michael Sumichrast & Arthur Andersen Real Estate Services Group.
The structure of the city, which would cost $1.2 trillion and take 30 years to build, would be located in a lake or the ocean and rise in cloud levels, the newsletter said. It would contain 12,000 to 23,000 acres of livable floor space. In addition to administrative offices, business and commercial space and living quarters, the company has planned a nature and space observation center, an energy plant and a recreation center. The United States ranked favorably on housing affordability in an international study of middle-income housing markets by the Arthur Anderson Real Estate Services Group. The average price per square foot in the United States was $67, with an average home size of 1,773 square feet. Japan ranked highest in cost at $433 per square foot and an average home size of 800 square feet. The average U.S. home costs three times the average middle-income salary, compared with about nine times in Japan, six times in England, five times in Canada and two times in the Netherlands.
IN THE BUSINESS ... Salomon Brothers Inc., a member of National Multi Housing Council's board of directors, predicted that 1991 will bring the worst decline in real estate since the 1930s, according to the trade group's newsletter, Washington Update. Salomon Brothers predicted that new multifamily construction -- structures with five or more units -- will decline to about 210,000, compared with about 260,000 in 1990. The national vacancy rate, which is now about 8.9 percent, is predicted to fall to about 8 percent by the end of the year ... In spite of higher delinquency and foreclosure rates, most mid-sized life insurance companies reported continued real estate lending, according to a survey by the Mortgage Bankers Association of America. Two-thirds of the 36 companies surveyed said they do not plan to decrease lending volume in 1991. Twenty-five percent reported significantly higher delinquency rates from the previous year, 42 percent reported slightly higher and 33 percent reported the same or lower delinquency rates. The average delinquency rate was 1.91 percent ... Sycamore Homes is offering home buyers several programs in hopes of improving consumer confidence. The company is promising to buy back any house that is appraised for less than the original sales price after two years. Sycamore also is offering buyers the option to refinance their mortgages at no cost if interest rates drop by more than 1 percentage point within two years of the purchase. In addition, the company guarantees that it will make mortgage payments for a purchaser who becomes unemployed. The owner will be under no obligation to repay once reemployed, company president Ron Frazier said ... Bozzuto & Associates began sales of 136 garden condominiums in Owings Mills New Town. The Silverbrook Farm condominiums, which are priced from $80,000, will be available after May 1991 ... Reston Land Corp. reported that 410,208 square feet of commercial office space was leased within Reston in 1990 ... Walker and Dunlop reported that it arranged $404.5 million in commercial mortgage loans during 1990. Of that total, 60 percent was for apartments, 31 percent for office buildings and 5 percent for retail space ... Ending a two-year dispute, Winchester Homes Inc. of Bethesda received approval from the Loudoun County Board of Supervisors to rezone Peace Plantation II from industrial to a mixed-use development. Winchester plans 300,000 square feet of commercial space, 460 multifamily units and 273 town houses. In addition, 73 condominium units will be designated as "affordable" and sold to purchasers who qualify in the county at below-market interest rates ... The Magruder Cos. reports it has sold 16 of the 24 $300,000-plus homes in its Rockville development, Terranova ... The Ashburn Village Joint Venture has completed construction on a $6.5 million sports facility within Ashburn Village, a development on Route 7 in eastern Loudoun County. The facility, which will be available to all homeowners, includes a gymnasium, indoor and outdoor swimming pools, tennis, racquetball and squash courts, weight training area and a marina on an 18-acre lake adjacent to the facility.
CALENDAR ... The Alexandria-based Community Associations Institute is planning a seminar on community association law tomorrow through Tuesday at the Washington Marriott Hotel ... Shannon & Luchs is planning a free seminar for first-time home buyers at the Cleveland Park Library Feb. 7 at 7:30 p.m. For reservations, call (301)513-2197 ... The Washington Metropolitan Chapter of the Community Associations Institute and the Maryland Energy Office of the Department of Housing and Community Development are planning the Maryland Energy Conservation Symposium and Trade Show Feb. 9 at the University of Maryland College Park Adult Education Center. The free symposium will teach homeowners how to make their houses more energy efficient.
PERSONNEL FILE ... The American Institute of Constructors named David J. Wahl of the Leesburg-based Toll Road Corp. president to the national chapter ... Miles L. Keirson was named vice president of McLean-based DoncoR Realty Group Inc. ... The Northern Virginia Chapter of the National Association of Industrial and Office Parks elected Stephen M. Cumbie of NVCommercial Group president for 1991.
Compiled from staff reports and wire services