Strange reversal of fortunes

I was talking to a family friend (roughly age 80) who was an physicist for NASA and now is a professor. He was a born into a working class family in Washington DC and chosen to attend the prestigious boarding scale Andover on a scholarship over 60 years ago. Andover is the oldest academy in the USA whose alumni include both President Bushes, and countless other famous alumni. Tuition, room and board is $53,000 per year year today (for high school). He went on to get a PhD and began work as a physicist.


As a child he lived in this 25 unit apartment building, built in the 1920s, about a mile from the Capital near the H Street Corridor. In 2012 Forbes voted the neighborhood as the best East Coast hipster neighborhood outside of Brooklyn. We looked it up to find that apartment rent today is $2,236 to $2,790 for very small apartments.

We all know people who grew up in inner cities from that generation that broke out to have prestigious careers. But I couldn't help thinking how out of control housing in urban areas is today. The gentlemen could probably never afford $2790 (inflation adjusted to each year) in apartment rent at any point in his career as a physicist. But that's what rent is in his old neighborhood.

I always ask, how the hell are people
paying these high rents. You charge
what the traffic will bear, and people
obviously are willing to pay $30K
a year to live in a small apartment.

$2700 a month is a mortgage payment
on a $400K house. At least you have
something when you're done.

Quote: Evenbob

I always ask, how the hell are people
paying these high rents. You charge
what the traffic will bear, and people
obviously are willing to pay $30K
a year to live in a small apartment.

$2700 a month is a mortgage payment
on a $400K house. At least you have
something when you're done.

I don't get who is renting these places or who is buying all these new homes. Nobody builds "affordable" places anymore. What little was being built got killed by the crash of 2008. The lowest I ever see new places going for is "$250s" and that is always townhomes. Only 20% of the USA makes over $100K per year, what you need to afford that.

Yet they keep filling up and selling out!

The next generation will have a huge serf class. Meanwhile, my neighborhood is showing early signs of gentrification, which I cannot wait for.

Quote: AZDuffman

I don't get who is renting these places

60% of your income goes for
rent, when it should never be
over 25%. They're robbing
their future to live above their
means in the present. Rent
doesn't have to be that high,
it's landlords getting rich
because renters are stupid.

Quote: Evenbob

60% of your income goes for
rent, when it should never be
over 25%. They're robbing
their future to live above their
means in the present. Rent
doesn't have to be that high,
it's landlords getting rich
because renters are stupid.

It was rare for me to see a homeowner with less than 45% of their income going to debt, and when they refinanced their equity was stripped away. I keep mine to <25%, and in this current layoff I am not struggling like I would have been 15 years ago.

Quote: Evenbob

I always ask, how the hell are people paying these high rents.

Part of the attraction of these apartments are not just that you are a mile from the capital building (so you could take a bicycle to work) but also that are you are 500 yards from H Street (popular hipster hangout).
https://washington.org/dc-neighborhoods/h-street-ne

These hipster hangouts were pretty much normal inner city life before WWII, when most people walked.

DC population surged during WWII
1940 663,091
1950 802,178
1960 763,956

% Black population in DC
1940 28.2%
1950 35.0%
1960 53.9%

In the late 1950s as part of the white flight from DC, his parents moved to Anacostia, which was a white bastion at the time.

Vancouver, BC had so much Chinese money buying up their homes the city imposed a twenty percent tax on foreign buyers.

I guess that past percentages of income allocation are about as valid as any other views or values from the past. If things have gone from Jacks or Better to Queens or Better one can lament that during the game but in order to be in that game you have to Queens or Better.

Quote: Pacomartin

% Black population in DC
1940 28.2%
1950 35.0%
1960 53.9%

In the late 1950s as part of the white flight from DC, his parents moved to Anacostia, which was a white bastion at the time.

I never got why Blacks were so attracted to DC. I would have thought it was always pricier than average, keeping poorer Blacks out.

Quote: AZDuffman

I never got why Blacks were so attracted to DC. .

Government jobs. Many white property owners bought in black enclaves for economic reasons.

Quote: Fleastiff

Government jobs. Many white property owners bought in black enclaves for economic reasons.

I can see whites buying to make a buck, big bucks in the ghetto if you do it right. But for years Blacks were effectively excluded from government work. Maybe it was because there was no Jim Crow in DC all those years?