Megan McArdle

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Washington real estate blues

08 Jan 2009 07:12 pm

No sooner do I find a place than I am beseeched for help from a friend planning to move into town with the Obama people.  The inauguration rental ads in the wrong place on Craigslist are still going strong, but they've been supplemented by clearly fraudulent ads aimed at the Obama folks.  I came across this myself during our house hunt, when I randomly discovered that someone was advertising my mother's place for rent, at a ridiculously low price.  A friend suggested we try to play the scammers, which would have been fun and instructive, but immoral, given that other people on Craigslist might be taken in by the ad.

I doubt that any current residents are being taken in, because we know that a $1400 2br in Georgetown, or $895 1br in the heart of Dupont, do not exist.  But I'm sure that there are people coming in from out of town--for the administration, or just because they're graduating from school or what have you--who are getting taken in.  What to do for these people?  Isn't there some sort of charity one can subscribe to?

If you are a potential newcomer, and you are reading this, here's my short, useless stab at explaining what to look for.  The gentrified neighborhoods in lower Northwest are:  Adams Morgan, Kalorama, Georgetown, Dupont, Logan, Foggy Bottom, West End, Chinatown/Gallery Place, Penn Quarter, U Street, and Columbia Heights.  The more adventurous may try Shaw, Bloomingdale, Eckington, LeDroit, or Petworth.

In Georgetown, Dupont, or Logan, you should expect to pay at least $2,000 for a one bedroom that you can turn around in; and similar in the others if you want to be above ground.  Each additional bedroom should cost you $300-600.  The standard deviation is about $150-$250 per bedroom, depending on the degree of gentrification; if you are 3 standard deviations from the mean, you are dealing with, on the expensive side, a busted house-flipper who is pricing the house to their mortgage payment rather than the market; and on the cheap side, a scammer.   This led to the odd sight, during my house search, of people asking more for a narrow, badly renovated row house on fourth and Elm than for a bigger place at 9th and Florida, which was farther from the ambulence run and closer to both bars and transportation.  You can guess which one we chose.

In the edgier neighborhoods, $1400 is about the bare minimum for a 1 bedroom you'd want to live in, unless you don't care about light, in which case, you can get a smaller basement in the $1000 to $1200 range.

Apartments that sound glorious--newly renovated, plenty of light and outdoor space, at least two bedrooms, and priced well under $2000--do not exist in any of the neighborhoods you have probably targeted.  It is not New York, or even San Francisco.  But it isn't exactly Smalltown USA.

Comments (44)

In Georgetown, Dupont, or Logan, you should expect to pay at least $2,000 for a one bedroom that you can turn around in

And that's reason #1 why I started my business in rural Virginia as opposed to taking one of the offers I had in DC. (5000 sq ft, new construction on 6 acres @ just under 1800 / month).

Sure it's not a big city, but downtown DC is just a 4 hr train ride away which, coincidentally is also the time I spent once driving from the Indian Embassy out to Gainesville (which is where I consider DC to end to the west).

Dupont resident

I have a studio a couple blocks from Dupont Circle. Only $1k/mo with a great view. Very tiny but it's plenty for just me. And, having been here several years, I benefit from one (or several) of the rent control programs. I haven't totally figured it/them out yet but it appears to boil down to a maximum percentage rise of half of CPI or so.

For shame - with typical NW tunnel vision, you totally leave out the very gentrified and wonderful neighborhood of Capitol Hill, as well as the less-gentrified but up and coming H Street neighborhood.

These are both good neighborhoods with easy access to the metro, downtown, and major roads leaving the city, so...for any folks moving to town, take a look at these neighborhoods as well. Capitol Hill is beautiful, clean, and safe, and the H Street neighborhood is safer than much of Columbia Heights, Petworth, or LeDroit Park, not to mention it's on the Red Line and has its own nightlife that's better than anything you'll find in the 'more adventurous' neighborhoods in NW.

Aaaah. Reason #43 that I love living out in the sticks. 3br; $350/mo.; free parking, water, and trash. No neighbors.

One other thing for people moving in who have or want to have a dog - Capitol Hill is the best urban neighborhood in the city to have a dog. You have Stanton Park, Lincoln Park, and Folger Park for them to run in, as well as the gigantic Congressional Cemetery (provided you get a membership, which is limited).

Columbia heights is not really gentrified. Its on its way, but it certainly doesn't belong in the same class as Logan Circle and Dupont Circle.

Furthermore, I live in Columbia Heights, in a huge 1BR (3 walk-in closets, separate dining), all utilities paid @ $1180 and the landlord is not a slumlord or a flipper. Its a vintage unit, with mouldings and trim, bronze doorknobs, leaded windows, and clawfoot tubs.

Before this, I lived in a studio in Dupont Circle for $1000/mo all utilities included.

It can take some time to find the bargains, and perhaps those arriving for new administration positions don't have time to pound the pavement. But the prices stated by the author are way above average.

Megan:

You really need to get out more.

DC has very strong rent control, so that means there are often large 1 BRs for well under $2000 in all neighborhoods.

Will they have granite countertops, a swank pool, and all the luxuries? No, because they are rent control.

And there is far more to DC than the narrow little NW hipsterville that you seem to know.

First, Capitol Hill. It's huge. And has tons of housing in all price ranges. Great neighborhoods.

The new ballpark area also has a large amount of rentals.

And of course there is Alexandria, Arlington, etc.

Presenting a small sliver of NW as being the only area worth looking at is indicative of a DC newbie without much imagination.

Nah, the prices by "the author" are just about right.

The thing about DC apts, as one who has hunted here, off and on, for a couple of decades, is that there IS actual inventory, and gems to be found.

There's also a whole lot of immediately-available shoebox places that big landlords are willing to have empty rather than cut prices.

Don't forget Takoma! I just moved to the Takoma neighborhood (DC not MD) and have a gorgeous one bedroom for $850.00 and it's right next to the metro.

Or, you know, they could live across the river in Virginia near a Metro line.

I have to agree with Megan on the neighborhoods. Sure, Capitol Hill and some of other neighborhoods outside of NWDC aren't that bad. But if you want to be near the swanky bars and restaurents and "hip" young DC crowd -- and there's not much point in being in DC otherwise -- then NW is the place to be.

I live in U Street corridor and love it. Lots of street life, metro close by, and plenty of watering holes to keep you well hydrated (or not hydrated, depending on what you're drinking).

Of course, even here there's plenty of crime. I'd estimate that nearly a quarter of my friends have been mugged (or nearly mugged) at one point or another, some more than once, and that goes for those who live in Dupont as well as Shaw. But then we're a late-night crowd prone to walking home from bars when we're less than in right minds....

Apartments that sound glorious--newly renovated, plenty of light and outdoor space, at least two bedrooms, and priced well under $2000--do not exist in any of the neighborhoods you have probably targeted.

So Obama people probably wouldn't even consider Ballston, or anywhere else in Alexandria or Arlington, much less short walks to the farther out Orange Line stops?

DC has rent control, with all that implies.

Independent George

No disrespect intended, but DC just doesn't strike me as that nice of a city to warrant those kinds of prices.

.....or they can tell Obama that they need to be paid more for them to partake in his dream........oh, that's right.......they all want to work for Obama because it's their destiny......

It's certainly possible to get pie-faced and go home with a new friend from a bar in Courthouse or Clarendon or Ballston as much as it is possible in Northwest. The Metro commute to downtown is no longer. And the prices seem substantially lower, and you pay Virginia taxes rather than DC's. What's not to like?

We just moved from out of town and got a great 1br for $1400 in Capitol Hill. Maybe if I was 5yrs younger I'd prefer to live in an area where my peers puke all over the sidewalk after a night out, but now I much rather have a few drinks and a pleasant stroll through this historic neighborhood.

Elizabeth Nolan Brown

Oh! This happened to me about a year ago. After the initial inquiry email came back full of typos and ridiculousness about wiring money and Nigeria, I egged the guy on a little bit and wrote an article about it for the AARP

Megan McArdle

I wrote about lower northwest because that's the area I know. There's no implied criticism of the other neighborhoods--though in fact when I lived in Silver Spring, I was constantly getting caught in DC by a metro shutdown. If you live in Virginia, you'd better either retire early, or have a lot of friends with soft couches.

ah, i live in georgetown proper in a 4-br townhouse for 2400 a month, split between four people. taint bad.

also, lived in logan a year ago in a pretty nice 2br for 1800.

there certainly are deals, you just need to inquire within 12 seconds of advertisement, and close the deal within 2 hours. so it is.

also, H street may be up-and-coming but for the moment it's still far too dangerous for the price. i know a guy who bought a house there and has been mugged three times, twice at gunpoint, in the three years since he moved in.

i hate this city.

Another vote for Northern Virginia. After a while, proximity to bars is a minus and not a plus.

Last summer I was trapped in a bar somewhere in NW with a couple of hundred people who were 5 or so years younger than I am, and I thought it was hell on earth. Now I prefer the Kennedy Center and the Shakespeare Theatre, which typically let out well before midnight.

The rest of you urban hipsters will too, and sooner than you think.

Captain Easychord

Having spent a fair amount of time apartment hunting in some of these neighborhoods (for myself and others), I think Megan's prices are a little on the high side... and if you can put in some legwork and a bit of time, you really can find a great apartment at a substantially better price point... it's harder now, given the short supply of apartments at this time of year (all of the inaugural ads don't help either)... but if folks just now moving to town can get short-term arrangements, there will be plenty of opportunities in a few months...

I've lived in Shaw for the last 10 years, and even then it wasn't a dangerous neighborhood, unless you lived in one of the warring housing complexes. Shaw was always a working class neighborhood, and though it is gentrifying it's still to a great extent a working class neighborhood. It's convenient to U St, Chinatown, Logan, and to a lesser extent Dupont and Columbia Heights. And it's a great neighborhood for dog owners, although when I lived in Logan there was always a great group of dog owners there.

Scholar in Training

The gentrified neighborhoods in lower Northwest are: Adams Morgan, Kalorama, Georgetown, Dupont, Logan, Foggy Bottom, West End, Chinatown/Gallery Place, Penn Quarter, U Street, and Columbia Heights. The more adventurous may try Shaw, Bloomingdale, Eckington, LeDroit, or Petworth.

The first sentence needs a bit more stratification. Georgetown is better than Dupont. Dupont is better than Logan, Foggy, Gallery, Penn, Adams. Adams is better than U. All are better than Columbia Heights. Columbia Heights should be in the second sentence.

I'd avoid Foggy Bottom. You are competing with college kids (GWU) whose cash rich parents will outbid you for an apartment for their precious daughter. Or their son who needs to study uber-hard so that he can transfer to an Ivy League school next year.

(If you are under the impression that college kids' parents are not cash rich investigate the demographic that GWU attracts.)

scholar in training, this is extremely subjective. what does "better" mean?

i mean, you couldn't pay me to live in adams morgan and deal with the jersey trash/post-sorority lush population that inhabits that neighborhood's night life, and georgetown is full of rich and obnoxious pastel-wearing twits. or by 'better' do you mean that you can walk to abercrombie and fitch?

like i said, subjective.

There's no implied criticism of the other neighborhoods--though in fact when I lived in Silver Spring, I was constantly getting caught in DC by a metro shutdown. If you live in Virginia, you'd better either retire early, or have a lot of friends with soft couches.

Silver Spring is on the Red Line. I remember a few years ago, when it seemed like the Red Line was catching on fire or breaking down or something every week. Blue, Orange, and Yellow lines are more reliable in my experience, and (for the Pentagon - Alexandria stretch), there's more of them. There are sometimes substantial weekend slowdowns, when they do maintenance, and because the network is not interconnected the way downtown is, that can leave you a bit stranded. But it's not too bad, since it's pretty much limited to weekends.

When the metro isn't working, bus service is also useable, at least on the Orange line corridor. The 38B Metrobus takes you from Farragut Square down to Ballston, and will drop you fairly close to all the metro stations on the way. The Metrobus is not particularly nice, and yuppies get class anxiety about using the bus anyhow, but it works fine in a pinch, and is not too bad by American standards.

I think there is comparable bus service down past the Pentagon to Alexandria but I don't know what lines are best -- oddly enough, even though I live along that corridor, I don't think I've ever taken any of those buses.

Oh, haha, I just realised "metro shutdown" wasn't referring to the crappy quality of WMATA's infrastructure, but to the fact that the metro doesn't run 24-7 like NYC. It's not that hard to plan to finish your business and play before 11:30 PM, though, particularly on weekdays. And on weekends, you can take a cab.

I rent out a 3br rowhouse (1550 sq ft) with a reasonable yard, parking, and a recently renovated kitchen, walkable to the metro @ $1950/mo.

The difference? It's difficult to find tenants who are willing to have NE at the end of their address instead of NW. It's a perfectly safe neighborhood - I lived there for 8 years before I moved, and was never had any crime related issues.

Any thoughts on Brookland (it's near CUA and much of it feels very middle class)? It's just a couple stops from Union Station. There are beautiful big old houses there, and it might make sense to share a house there with roommates. The parts of it I looked at were cleaner and tidier than Georgetown, but (not coincidentally) there's very little commercial development. Schools (both public and private) are apparently an issue.

Amy P: Brookland is the neighborhood I was referring to in my previous post. Wonderful place, nice and quiet, but a few steps to the metro. I had to move out of DC, but I lived there for 8 years.

ScentOfViolets

I'm in the mid-west, but I have perhaps something to contribute: the various 'neighborhood loan' programs that take once nice has-been areas and reinvigorate them can make quite a difference in rent/mortgage payments. My house is on the largish side (though the yard isn't as big as I like - I grow tomatoes, corn, etc) but, to put a good spin on it, is a great lady past her prime.

I live in a neighborhood that cycled through faculty housing to ordinary blokes owning to landlords renting out to college students and then renting to any sort of riff-raff. The houses aren't bad for 80-year-old houses, but they do need repairs and upkeep. So the city started a neighborhood loan program - laced with various restrictions that made going over the papers a real pain - of which we were the beneficiaries. What would have been a maybe $3,000/month mortgage in the old days was just shy of $1,000/month for us. And the city benefits too. In the ten years we've lived here, the landlords have mostly gone, younger families are in, sagging porches have been repaired/replaced, lawns are kept up (though there is some argument about what that means), roofs are stripped of 80 years worth of shingles and redone, etc.

It seems to work pretty well here, perhaps because any man who can't saw a straight line or hammer a nail isn't really considered a man in these parts. My question is, how well does this work in places like the DC metro area? And is this a viable option for more than a tiny, tiny percentage of people?

SoV,

$1,000 a month sounds right for what you're getting (it sounds like the off-campus location is probably convenient for you), but would anybody in their right mind have paid $3,000 a month in the midwest for a fixer? That sounds very bubbly.

However, now that I think of it, we live near a college in Texas and the off-campus landlords try to get around $500 rent per bedroom for basic 4BR and 5BR houses for the student market (although it goes as low as about $300 for older units). We pay $1,000 a month rent for a 2000 sq. ft. 3BR house, but the university is our landlord, so it's not really a market rate. Rental prices are much more reasonable once you get out of the student rental zone.

If your friends are coming to work on the Hill, then living on the Hill means they can walk to work, which was by far my favorite thing about my Capitol Hill days. (That and all the dogs) If they're coming to work at the White House, then I have no real suggestions for them.

I echo the comments from the Brookland commenter. I live in Woodridge (google it), and I know that the price of my land was lower in part because the address had NE attached. Which was good for me, I guess.

I missed this part:

"My question is, how well does this work in places like the DC metro area?"

A lot of people have done that sort of thing around Capitol Hill and other gentrifying areas and were successful, especially in the late 90s. However, my feeling is that the housing boom made it less feasible. Before we left DC (summer 2007), I was looking for houses in suburban MD, especially in fringy neighborhoods with less desirable public schools. They were running $400k-$500k, and they were nothing to write home about. There was barely anything under $400k. I was wringing my hands over it, and we moved to Texas. Fast forward to the present. I continue to occasionally check the 20850 zip code at realtor.com. There are now a lot of houses in the $200s, including quite a few single-family homes. At the peak, it would have been a financial disaster to buy one of these so-so houses at $400k and then sink money into fixing it up. Anybody who did that would now be $200k underwater.

ScentOfViolets

Amy, I phrased that badly, in addition to rounding. But yes, the problem is with the landlords that come in and subdivide large older houses into two, three, or even four(!) smaller rentals. As rental units, they're quite profitable, but any homeowner coming in has a lot of work to undo the mess and repair accumulated damage. So the city has a semi-official squeeze policy to get bad landlords to vacate(amazing, the number of people who think this is an easy way to make money) while offering good terms to prospective owners.

Anyway, my question is, is there anything like this program in the metro areas that people can take advantage of in significant numbers? I'll be the first to admit that these neighborhood improvement programs have had mixed success; there appears to be a tipping point over which no amount of incentives seem to work (there's also a racial component too, unfortunately.) Also, many landlords here are willing to leasee home improvements out of the rent. I suspect this might be a cultural thing not applicable to certain parts of the country.

ScentOfViolets

Ah, Amy, I didn't put in those numbers, and this was in 1998, but we paid not quite $100K, and initially the landlord had been asking for a bit more than $250K in 1996.

As I said, the city has ways to put the squeeze on shoddy landlords . . . it it wants to. It seldom does. I'm guessing that what happened is that certain members on the city council made particular neighborhoods into personal projects, for whatever unknown reasons, and that we happened to be among the beneficiaries. Such is the play of politics in what is really a small town. Of course, such is the play of politics in larger towns too.

Megan's prices are accurate. Those of us who have great apartments with utilities included for under $1100/month are lucky bastards benefiting from rent control, and we know it. I doubt that out-of-towners with few connections here--that's how I got my gem-- and little time to spare will get to ferret out the exceptional exceptions which have popped up in the comments above.

So Obama people probably wouldn't even consider Ballston, or anywhere else in Alexandria or Arlington, much less short walks to the farther out Orange Line stops?

They might...but if they're child-free, I can see why they wouldn't. I've lived here for ten years (pre-gentrified Logan, Glover Park, Kalorama, Dupont and now Georgetown). The two years-- and these were the only two years spent outside DC-- I lived in Ballston were the worst of that decade, if not my life. I moved the *second* I was able to do so, and I left the poshest building on the block, with a view of the Cathedral, granite, marble, and THREE parking spaces in my dust. Anyone who would sacrifice the vitality of city living for those yuppie comforts deserves neither the city, nor any comfort.

And about that Orange line: it was packed, since people drove in from the sticks to the first few stops on the line. By the time the train got to Ballston, it was usually quite crowded. Meanwhile, outside of the whopping three dining options on our block, all of which closed early and none of which served anything memorable, the streets were empty in the evenings. Fun! Late night dining? Ha. Depressing? You betcha.

Nothing compares to living *in* the city. Nothing.

Oh, and as for this:

No disrespect intended, but DC just doesn't strike me as that nice of a city to warrant those kinds of prices.

Then you don't know my D.C. I've lived in San Francisco AND Manhattan; my home is here for a reason. I think D.C. is one of the most under-rated cities in the country. Guaran-sheed.

I second the various recommmendations for Capitol Hill NE- I live in an area that just won the fight over "historic" Capitol Hill signs.

It's a few blocks to H Street bars, a couple blocks to Union Station, and a few blocks to Eastern Market.

Perfect, relatively cheap (1850/2 br), and has everything you need as a young person in DC.

However, I do get sick of the NE sneer that NW people have in this city. It's obnoxious, and unnecessary. Get over yourself.

OT: anybody who would rent an apartment without actually walking through it deserves to get swindled.

Even if it means taking a trip just for the apartment hunt, that's what you do. Otherwise, you're laying out cash for pixels on your computer screen. And if that's all you get in the end, you shouldn't complain because it's all you paid for.

"But I'm sure that there are people coming in from out of town--for the administration, or just because they're graduating from school or what have you--who are getting taken in. What to do for these people? Isn't there some sort of charity one can subscribe to?"

Why do something? Haven't you heard of evolution before? This sounds like a glorious way to reduce to possessions of stupid people, which need to become extinct so we can improve the gene pool. Time for the stupid people attempt to rebuff this with their biased illogical emotional drivel.

OT: anybody who would rent an apartment without actually walking through it deserves to get swindled.

At least in San Diego, many times they are able to even provide a walkthrough of the property thanks to all the foreclosures. They usually have some way of knowing the key combination of the realtor lock box so they even have a key to get into the property with. They take a bunch of deposits/first month and skip town.

Marvellous discussion. All about renting and not a word about buying your own home! For more years than I can remember finding your own place talk has only mentioned renting in passing.

I would like to think that this outbreak of economic rationality in the McArdle corner of the Atlantic empire is due to her blog's extraordinary attraction for rational readers. Unhappily, commentary on other posts raises questions (and opinions on my own degree of rationality are divided).

In 2000 I rented a two bedroom basement apartment at 12th and Rhode Island NW for $525 a month. This was one block from the Logan Circle circle, in the greater Shaw neighborhood (which includes U St, Logan, Blagden, Truxton and MidCity). It wasn't fancy, no building laundry and I spend a few weeks killing the multilegged critters, but splitting the $525 with a roommate made it worth it. And then the neighborhood wasn't as nice, or let's say the bad stuff was harder to ignore.
If you look hard enough and are flexible you can find affordable housing. Problem is people aren't flexible. NoVa has stuff, as does NE and SW DC, and Greenbelt, College Park, Silver Spring and the rest of Southern Maryland.

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