Home Sweet Home?

Questions about who gets to live in Rappahannock are perennial

A Rappahannock News/Foothills Forum special report by Sara Schonhardt

Graphics by Laura Stanton

Housing has long been a topic of discussion in Rappahannock. What’s available? What’s affordable? Commissioned studies have attempted to better understand the challenges – though most have taken a regional view with little local follow up — and nonprofits have formed to help offer more options than what’s currently available. 

The 2020 update of the county’s comprehensive plan, now headed to the Rappahannock Board of Supervisors for consideration and another public hearing, acknowledges the importance of affordable housing and encourages development within “designated village areas.” The challenge: How to provide it without damaging the unique character and scenic beauty of Rappahannock.

This report, the first of two, aims to enrich these continuing discussions by analyzing responses from 120 people to a questionnaire we circulated last fall. It also includes expert input based on more than three dozen interviews to paint a clearer picture of the county’s housing situation. Amid the COVID-19 pandemic and the deep recession it has sparked, the focus on housing is even more timely and important.

In future pieces, we’ll tell the stories of several residents who have faced housing challenges and report on some potential solutions. In the meantime, we’d like to hear from you. What do you think could help address some of the county’s housing issues? Do you have a story or housing experience to share? Send your thoughts to [email protected].

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About this project

Our goal with this special report is to ground some of the local arguments on housing in facts and data. We had a base to start with: Concerns about housing affordability and availability surfaced in the March 2016 Foothills Forum Survey. At that time, housing affordability was the 12th most important of 25 randomly presented issues. And four in 10 respondents told us they could not afford to live in Rappahannock. 

More recently, community members listed housing as the top need in the nonprofit health and human services agency People Inc.’s latest needs assessment of the 13-county Northern Piedmont region it serves.

We followed the Foothills Forum Survey last fall with an unscientific but extensive community questionnaire that sought direct feedback from residents and would-be residents about their housing challenges. The 120 responses provide a snapshot of their experiences, ranging from how they make decisions about where they live to their budget limitations. 

The questionnaire, distributed in hard copy and through the online polling platform Survey Monkey, was sent out by the Rappahannock County Public School system; the Food Pantry; to local clergy via the Benevolent Fund, which provides residents with short-term, emergency financial help; the Facebook group RappRentersNet; the Industry Night group, which hosts gatherings for people employed in the food and farm sector; the county’s Department of Social Services; and numerous business and community leaders. We then compiled answers from the 120 responses and grouped them into different data sets, which revealed some of the biggest takeaways.

• Click here to see the questions or fill out the questionnaire directly.

Data used to inform this project also comes from Census figures, information available on real estate sites such as Zillow, and through local real estate agencies. Plus, we conducted some three dozen interviews with housing experts or those whose work relates to housing in addition to holding numerous conversations with local residents.

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What we learned:

• Housing is limited and expensive, especially for lower and middle-income households.

• Rentals are a problem because they’re even more limited than homes for sale and many are found by word of mouth.

• Home values are higher in Rappahannock than many neighboring counties, and far above the national median. The same is true of median rents. 

• More than half of all renter-occupied households in the county are considered cost-burdened, meaning renters pay more than 30 percent of their monthly income on housing.

• As a result, people are putting a larger percentage of their income toward paying for housing. 

• And when households are paying more for housing than they can really afford, they have less to spend on other needs, such as food, transportation and savings.

• Yet the results of our community questionnaire reveal that people largely chose to live in Rappahannock for a combination of reasons that make it more appealing than living elsewhere: They love the county’s natural beauty and peace; its sense of community. They have family here, deep roots or employment. 

• Housing prices have been increasing while incomes have not. This makes it more challenging for households to afford their rent and mortgage payments.

• Second homes and short-term rentals, such as those offered through Airbnb, remove homes from the market, particularly in tourist-driven economies. 

• Housing stock is down at the same time that demand has jumped, according to real estate market data. The COVID-19 pandemic has only deepened the supply-demand gap, sending home prices up. 

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Frequently asked questions

Is there a housing problem in Rappahannock? 

Rappahannock County has a shrinking, multigeneration population of roughly 7,300 people — youth, workers, retirees and second-home owners requiring a reliable roof over their heads. That includes the community’s essential employees in education, public safety, hospitality and services. Some residents fear building more houses, particularly those suited to the needs of the middle- or lower-income population, imperils the natural beauty and open spaces we all profess to love and want to preserve. 

Yet many of those same essential workers point to high rents, high home prices and taxes as reasons they struggle to live here. And it’s why many must live elsewhere. 

“As a professional couple with a good income, we still can’t afford most housing in Rappahannock,” said a would-be resident who responded to the Rappahannock County Community Housing Questionnaire.

“Places are either way too high, or we don’t meet renters’ ‘standards,’” said another respondent. “I need a house to call my own, for my family. [We] currently live with my grandparents and it’s very cramped.”

One respondent cited sparse availability, “especially for people with limited incomes who work in the county to provide services to people.” 

“Too expensive for this market,” said another. “Finding housing is just sheer luck. Makes renters willing to accept substandard housing and landlords.”

Another challenge we heard: The lack of small houses on small acreage suited to young workers, small families or seniors. 

Are there not affordable houses to rent or buy here?

Housing supply is low in Rappahannock, as it is at a national level. That is partly because demand has outpaced new construction, especially for low- and middle-income properties that are less lucrative for builders. Rappahannock’s restrictive zoning exacerbates this shortage. People are also staying in their homes longer. And while historically low interest rates have made it easier for homeowners to afford a mortgage, limited supply and heavy competition among buyers has pushed up prices.

Since the start of the COVID-19 pandemic, inventory levels have dropped further, said agent Cheri Woodard, largely because people who may have been thinking about selling have taken their homes off the market. 

As of the end of August, there were 66 residential properties on the market in Rappahannock, not including land or farms, according to Adam Beroza at Woodard’s agency. That’s down from the same period last year, when on average there were 93 residential properties available. In 2018 it was 92, and in 2017 it was 95. 

Second-home owners in Rappahannock who might have rented out their properties are moving into those spaces full time, further reducing supply, said Amy Timbers, an agent with Washington Fine Properties who often works with or advises renters.

“There is definitely an affordability issue for low and moderate income people in Rappahannock County,” Rob Goldsmith, president and CEO of the nonprofit People Inc., said in an email. “There’s just not many affordable housing options for people in the county.”

There are homes here priced around $200,000, said Woodard, particularly in the Chester Gap area. But there are typically just a few at any one time, and buyers looking in that price range can’t be as picky about what they want.

A questionnaire respondent described the options this way: “Anything big enough to hold our family is in the $700K range, and anything that’s affordable is in a horrible location or can’t get Internet.”

What’s at the root of the housing challenge in the county?

On the supply side: 

• Too few units to meet demand, Beroza’s data says. 24 of those 66 properties on the market were already under contract. 

• Rappahannock homeowners often remove auxiliary structures that could be fixed up and used as rentals rather than pay taxes on them, say real estate professionals.

• Housing suitable for seniors is in short supply.

• Competition between low-income earners or first-time homeowners with limited established credit, and retirees/second-home buyers with savings or good credit scores.

• This tight housing market limits tenants’ leverage, forcing some to live in substandard housing or accept higher rents. 

• Tourist homes, such as those listed on Airbnb or VRBO.com remove potential rentals from the market.

• High construction costs make new builds lucrative only if they target high-end buyers. 

On the demand side: 

• Not enough land zoned for multifamily and small, single-family homes. While Rappahannock’s tightly controlled zoning has allowed it to preserve its space and landscapes in ways other counties have not, it has led to higher costs.

• Inadequate water and sewer infrastructure in villages where new homes can be built.

• Long and complex development approval processes.

How do Rappahannock housing prices compare to elsewhere?

Prices were high in Rappahannock even before the COVID-19 pandemic and have been trending upward.

The average home sales price for the first half of 2020 increased 19 percent, to $435,191 from $367,036 during the same period a year earlier, according to a July market report produced by Beroza. 

At $1,049 a month, Rappahannock’s median gross rent is higher than neighboring Page, Warren or Madison counties. And the median home value for Rappahannock — $359,800 — is higher than all five surrounding counties aside from Fauquier. 

In addition, roughly 60 percent of owner-occupied homes in Rappahannock were valued at $300,000 or higher compared to 32 percent nationally, according to 2018 Census data. More than 65 percent of residents pay $1,500 or higher in monthly mortgage payments compared to around 50 percent at the national level. 

And while half of all renter-occupied households pay more than the $1,049 median rent, nearly as many (52 percent) are considered cost-burdened, meaning renters pay more than 30 percent of their monthly income on housing. Altogether, the percentage of households in Rappahannock facing extreme cost burdens — paying more than 50 percent of their income on housing — is higher than surrounding counties.

“By far the largest housing challenge in rural communities is the ability for households to afford their rent and mortgage payments,” said Lance George, director of research and information at the Housing Assistance Council (HAC), a Washington D.C.-based nonprofit focused on rural housing. “And that has largely been [due to] a very simple equation that incomes have been stagnant in rural communities … while housing prices have been increasing, especially for renters.”

Who faces the biggest challenge: Renters or buyers?

Real estate professionals say the rental market poses the biggest challenge for Rappahannock, in part because it’s so informal. Many rental homes are not listed with agents or online marketplaces but are shared by word of mouth. 

The Facebook group RappRentersNet is trying to solve that problem by pairing landlords with potential renters, but the lack of a central database still makes it difficult to quantify what’s available while allowing sellers to set their own prices regardless of market trends.

Bruce Geisert, who set up and administers the group, doesn’t keep data on matches made, but it has grown to more than 500 members since starting in May 2019 and he says people seem to be finding housing. A challenge is reaching people who have a single room to offer or finding places for those who would be willing to share housing, he added.

Census data shows that just over one in four households are renters in Rappahannock. But for younger people, low-income and non-family households, the rental market is increasingly important. 

And the share of renters both locally and nationally is growing. According to a recent report from the U.S. Government Accountability Office, since the 2007–2009 financial crisis, growth in the share of renter households has reversed a decades-long trend toward homeownership.

Who is most in need of affordable housing?

The United Way defines households according to a metric known as ALICE — Asset Limited, Income Constrained, Employed. It measures whether a household earns enough to cover a basic budget including costs for transportation, housing, food, child care, health care and technology.

The ALICE report is important because it gives a sense of who within communities are experiencing the pressures of housing insecurity, said Darryl Neher, executive director of Fauquier Habitat for Humanity. He points to the backbone of our community – teachers, firefighters, police officers and young professionals. 

“All of a sudden we’re not talking about poverty housing, we’re not talking about low-income housing, we’re talking about the housing needs of the people who we would otherwise never really think about as being housing constrained or impacted by housing costs,” Neher said. 

Why does affordability matter?

“It’s the foundation to so many opportunities for family stability or individual stability,” said Neher. “If you’re paying 50 percent of your income on housing, what choices are you having to make on other expenses? Is it making the decision not to pay for health care? Is it not buying medications, is it making choices on food quality that might be less than optimal for you and your family? Those all have impacts.”

Transience and housing instability have an impact on childhood education and employment as well. And, Neher notes, this feeds into negative outcomes for individuals and communities.

“What we hope to be able to show and help people see, is the people in need of stable housing are your neighbors,” he said. “The people who are working in your businesses and next to you at your job, they’re working on your farm, they have children, they have aspirations, they’re the same as everyone else.”

What is housing’s impact on hiring?

“If workers cannot find affordable, appropriate housing in the region, businesses may have difficulty attracting and retaining talented employees,” notes a 2018 basic housing needs assessment of the Rappahannock-Rapidan region by the Virginia Center for Housing Research (VCHR).

Craig Batchelor, owner of the Sperryville Corner Store, Rappahannock Pizza Kitchen and Bar Francis, said roughly 18 of his 24 employees live in the county. Some younger staffers still live with their parents while a lot of the more recent hires commute in from Luray or Culpeper.

Housing shortages impact the size of the applicant pool, he said. And finding local housing for folks who want to move into the county to be closer to work can be challenging. He’s been trying for two years to find housing for an employee who commutes 45 minutes each way from another county.

Theresa Wood, head of Businesses of Rappahannock, said in the many conversations she’s had with business owners who’ve had difficulty hiring, particularly in hospitality, the lack of hours available for staff is more pressing than the lack of workforce housing. 

But employers say having staff who live nearby helps reduce commuting costs and is a benefit in the winter, for example, when there is bad weather.

Commute times are an obstacle according to Jennifer Parker, director of the Rappahannock County Department of Social Services. Only one of her 12 employees lives in the county, which can make for long drives at odd hours if social workers get calls in the middle of the night. And it can lead to a lot of turnover. The starting salary for a family services worker is $30,828, she said.

Rappahannock County Public School’s (RCPS) Assistant Superintendent Carol Johnson said prospective new hires haven’t reported housing as a barrier to taking a job. New teachers tend to live in the more populous surrounding areas, she said.

Roughly 31 percent of RCPS staff live outside Rappahannock and commute in, Johnson added, noting that most teachers who live outside the county say they cannot afford to live in Rappahannock. 

Mel Jones, associate director and research scientist with the Virginia Center for Housing Research, said that’s a choice a community has to make.

“If you want to exclude people who work in low-paying jobs from your community, you will also exclude the home health aides that you need when you age and the people who you want to serve you coffee and food in restaurants and who you want to take care of your children,” she said.

Some businesses, including many of the local farms, offer employer-provided housing. Debbie Donehey, owner and manager of Griffin Tavern in Flint Hill, has three rental units that she offers to staff for discounted rent. As an incentive to keep good workers, she asks that her renters average around 30 hours of work a week. 

The arrangement has worked well. Her current staff tenants have been in her rentals for years. 

What impact do Airbnb and weekend rentals have on housing in Rappahannock?

Second homes and short-term rentals, such as those offered through Airbnb, remove homes from the market, particularly in tourist-driven economies. 

Rappahannock’s Commissioner of the Revenue office monitors Airbnb, VRBO and other sites to see if new properties show up and then tries to contact the owners to get them to register those rentals. Most do, says the commissioner, allowing the office to collect required taxes. 

The Revenue Office currently lists 57 registered lodging accounts, including both tourist homes and Bed & Breakfasts. That’s up from 46 registered accounts in February. 

Coming up

In our next FAQ we’ll address questions about how the COVID-19 pandemic has impacted the housing market and the special challenges facing seniors.

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Housing: A glossary of terms

Affordable – The U.S. Department of Housing and Urban Development (HUD) defines affordability as a household not spending more than 30 percent of its income on housing-related expenses. 

ALICE – Stands for Asset Limited, Income Constrained, Employed. ALICE households are those with income above the federal poverty level but below what’s needed to cover the basic cost of living for the county. Those costs are housing, child care, food, transportation, health care, technology (such as a smartphone plan) and taxes. They do not include savings for emergencies or future goals, like college or retirement. While 11 percent of Rappahannock households fell below the federal poverty threshold in 2018, an additional 24 percent fell below the ALICE threshold. Together, that means 35 percent of the county’s households were struggling to afford basic needs, according to the latest ALICE data. 

Cost-burdened housing – Cost burden is calculated according to the ratio of housing costs to household income. For renters, housing cost is based on rent plus utilities. For homeowners, housing cost includes mortgage payment, utilities, insurance and real estate taxes. A household is considered cost burdened if it pays more than 30 percent of its income for these housing-related expenses.

Low-income household – According to HUD data, there are around 1,200 low-income households in Rappahannock, meaning their income is 80 percent or less of area median income according to definitions set by the U.S. Department of Housing and Urban Development. That’s roughly 38 percent of all households in the county. 

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Part 2 | ‘We are out of balance’

Read the story here.

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