Dead DC Housing Market Whaling on "Immune" Areas
Reads ye all about it in Fairfax County.
A worsening housing market, including rising foreclosures, has rapidly pushed Fairfax County government into a budget crisis that probably will last several years, pinching spending by hundreds of millions of dollars on schools, public safety and human services, officials said yesterday.
The crunch on government spending is expected to be worse in other communities, including Loudoun and Prince William, where housing values are slumping more dramatically and foreclosure rates are higher. But the news that Fairfax, an inner suburb with more stable property values and a robust job market, is suddenly feeling such profound consequences of the housing bust suggests that the effects on the regional economy are just beginning to be felt and could last for years, county budget analysts said.
County officials put the budget shortfall at about $220 million and cited a series of telling statistics, including a steep drop in housing sales and a sharp increase in the number of houses languishing on the market. Most dramatically, Long said the number of home foreclosures in Fairfax County has jumped from 198 in 2005 to about 4,000 this year.