• Census Special Report Main Page

By Danielle Ulman
Capital News Service
Tuesday, Sept. 12, 2007

WASHINGTON - Montgomery County saw more homes built than any other Maryland county in the 2005-2006 year, according to a new census report, but it's unclear whether the new development helps fill the county's need for affordable places to live.

The latest U.S. Census Bureau data released to the public today showed the county added 3,022 new homes from July 2005 to July 2006. But that figure is a drop from 3,251 in the previous 12 months, and well below the 4,666 added between 2001 and 2002.

Montgomery is an expensive place to live. The median home price there is $534,000, according to census figures, while the statewide median is $349,400.

"Affordable housing is a challenge for our county and probably every other county in the state," said Valerie Berton, media relations manager for the Montgomery County Planning Board.

"We continue to grapple with it," she said. "Certainly multi-family units are cheaper than single-family homes and that's where we're seeing our increase."

The census data did not identify the cost of housing offered, only that new units were added, although Berton said the new units were evenly divided between multi-family and single-family units.

Richard Nelson, director of the Department of Housing and Community Affairs, agreed that the county needs more inexpensive housing options.

"We clearly have a need for housing in the county, especially affordable housing in the county," he said, but added that growth needs to be managed.

Prince George's County fell close behind Montgomery, adding 2,903 units, almost double the number built the year before. Harford and Anne Arundel counties ranked third and fourth, with 2,521 and 2,205 units added respectively.

Adam Iobst, a real estate agent in Montgomery County, said the housing market has expanded, while demand for high-priced housing has not shown a substantial increase.

"I think that there's a lot of inventory right now. The demand is about the same, and price points are pretty much the same," he said.

More inventory may mean better options for buyers, but added development at a time when the housing market is in a slump could have a negative effect.

"There are so many resale properties on the ground that are competing, and a lot of the new construction projects that were started a few years ago are coming to the market now," he said.

New construction might be more attractive to home buyers because it's often more affordable, and many properties come with incentives for buyers.

"They're getting very aggressive with their offers in condo units. Sometimes 8 percent is paid back to the buyer," Iobst said.

Seller-provided incentives for buyers might help offset fees buyers pay for purchasing new property used by the county to defray the burden of providing schools, transportation and other services to the additional residents.

Montgomery County's growth policy imposes a development impact tax on all new residential properties, which varies depending on the location of the property and the use of the land. A single-family detached home would be taxed more than a condo in a residential high rise, and rates would be lower if the residence was located near a Metro station and higher in newly developed Clarksburg.

"We are mostly growing in multi-family units, and in our view we're succeeding in what we're trying to accomplish with smart growth policies," Berton said. "Most of the units are in downtown areas like Silver Spring and Rockville near mass transit, close to employment centers."

She said 60 percent of new housing for 2007 will be multi-family units.

"There is ongoing discussion in the county about how much new development there should be," Nelson said.

"The current county executive is committed to preserving the open space we have, but he is also realizing that we do need to expand," he said.

A major issue of the 2006 election was how much growth the county should allow, leading to what Nelson called, "a considerable slowdown in growth in the last year."

Talbot County's problem is in keeping pace with its ongoing growth. The county saw its housing offerings swell by 3.27 percent from July 2005 to July 2006, the largest percentage increase in the state.

"We're a small, rural community and sometimes you can't get the growth to happen all at once," said Paige Bethke, director of the Department of Economic Development. "I think the housing market growth has been happening and the commercial growth is catching up to that," she said.

While the 609-unit increase may be modest, in a county with only 19,247 housing units, those additions translate into big changes.

"Anytime you have growth, you have all the burdens on the infrastructure," Bethke said. "The roads are more congested, and it's harder to get around. People have been tolerant of growth. I think they're mindful of it and they definitely notice it."