Chesterfield leads region in home sales, but faces affordable housing challenge | News

Chesterfield County again led the region for single-family home sales last year, but faces challenges when it comes to housing affordability. 

That's according to Laura Lafayette, chief executive officer of the Richmond Association of Realtors, during her presentation to the Chesterfield Board of Supervisors this week.

In the county, 5,460 single-family homes sold in 2016, a 13.5 percent increase from 2015 when Chesterfield again led the region. Sales in Chesterfield outpaced Henrico County, the second hottest housing market in the region last year, by 1,805 homes. The average sales price in Chesterfield was $266,484. Lafayette said she expected the number to be the same, if not slightly higher, by the end of 2017.

"This is obviously a sellers market. If you want to purchase a house, you’ve got to bring a full-price offer," Lafayette said.

While Chesterfield led the region for single-family home sales, Henrico came in first for condo and town home sales for the past two years. Henrico's 948 condo and town home sales last year far surpassed other localities, more than doubling the number sold in Chesterfield.

Overall, Lafayette said the region's economy has been steadily recovering since "bottoming out" in 2010. The region's economy is outperforming that of the state and nation, Lafayette said, referring to unemployment and job growth figures. 

"It's really been tremendous. Central Virginia is a good place to be," she said.

But Lafayette said there still aren't enough of the type of homes attractive for first-time buyers that typically list between $150,00 and $225,000. Other challenges, she said, include rising mortgage rates and housing affordability. 

Almost one in five Chesterfield homeowners are considered cost-burdened, meaning the homeowner is spending between 30 percent and 49 percent of his income on mortgage costs or rent. A smaller share of Chesterfield's households, 11.5 percent, are severely cost-burdened and spending more than 50 percent of their income on housing. 

"It's not a unique challenge in Chesterfield. But it is a challenge that we need to take a look at," Lafayette said. 

There is also an imbalance in the county. The number of home sales is higher in the western part of the county where construction of new homes is more prevalent. 

And public transportation is lacking in terms of connecting job centers and the places where the people who work in those centers can afford to live. The GRTC bus network accesses about half of the region’s lower-cost housing, and only 45 percent of modest-wage jobs are located within a quarter-mile of a transit stop, researchers with the L. Douglas Wilder School of Government and Public Affairs at Virginia Commonwealth University found in an analysis of jobs and affordable housing in the Richmond metro area.

Lafayette said the Jefferson Davis corridor in the eastern portion of the county is an opportunity to build denser developments.   

"Density done right can be attractive. It's not whether density is a good or bad thing. It's about where that density should be placed," she said.  

The regional Partnership on Housing Affordability has recently commissioned two studies. The first study will explore the preservation of older housing, which Lafayette said is a major part of the county's affordable housing stock.  

"What should the public sector investment be that is catalytic for private sector re-investment?" she said. 

The second study, at the request of Chesterfield Board of Supervisor Chair Dorothy Jaeckle, will focus on the senior population. Those between 65 and 74 years old and older than 75 years old are the fastest-growing age cohorts in Chesterfield, Lafayette said.

"They’ve aged in place. They have no mortgage on their home, but they aren’t going to move and take on another mortgage ... You're not going to get these seniors out of these homes and free up that first-time home ownership opportunity unless they have affordable choice," she said. "If we could build for them, and they could move, what kind of dynamic would that create?"

Jaeckle said the Jefferson Davis corridor is a "great opportunity" to redevelop some of the land to create affordable housing options for seniors and for those who would find the homes that seniors vacate attractive. 

Lafayette said the county could think about a trust to increase the affordable housing supply for seniors. Under that arrangement, a non-profit organization would "own the dirt," Lafayette said, and take the cost of the land out of the equation. 

Danna Markland, the new executive director of the Homebuilding Association of Richmond that represents home builders and developers, told supervisors that home builders could provide more affordable housing options if they were allowed to build smaller homes with less square footage and higher density.

She also talked with supervisors about the labor shortage in the construction industry, and how a lack of technical training in schools is feeding that shortage.