The town of Potomac Hills’ town council has turned down any expansion of the master plan. The AD News covers part of the issue with their article, “Growth restrictions drive up Potomac Hills real estate prices.” I sat through the master plan meetings and it was clear what most of the town residents were requesting. Relief from the exponential rise in housing costs and the concern of the loss of the town character based on the demographic that could afford the price of homes. They are concerned that more working people will need to move further and further down valley. They were concerned about the environmental impact of cars being on the road longer as workers commute longer and longer distances through the valley. Sandy Lucas was much more diplomatic in the article than I would have been. The council had a number of different master plan options to work with.
I can certainly understand the desire to keep a town small. But at the end of the day, what is happening to the real estate market in Potomac Hills is a case study in basic supply and demand economics. The council could have made a different choice and provided solutions to many of the housing issues the town currently faces.
Below please find the AD News article from today.
AD News: The Potomac Hills Town Council’s conservative stance on development is having a marked impact on the midvalley market. Town planners are seeing an increase in applications for development within the town’s the urban growth boundary, according to Potomac Hills town planner Kevin Lidt.
“Our perspective is that (limits on growth) have increased the examination of properties and the speculation of properties by Realtors and developers. People have expressed more interest, and that’s kept us busier,” Lidt said on Wednesday.
Lidt, who spent seven years as a senior planner for the city of Anthony Lakes, does not expect a moratorium on development from City Council any time soon.
“As far as general land-use applications, we have different code requirements in Potomac Hills (than they do in Anthony Lakes),” said Lidt, who takes his direction from council and evaluates applications accordingly.
While acknowledging that Potomac Hills is experiencing a similar real estate frenzy to Anthony Lakes’ from a few years ago, Lidt was hesitant to draw exacting parallels.
“Potomac Hills doesn’t have the level of affordable housing that Anthony Lakes has, for example, and we might come up with different solutions, because we haven’t even hashed out our master plan yet.”
An ungainly gap between high-end properties and affordable housing units is at least one Anthony Lakes phenomenon now appearing in Potomac Hills. In addition, subdivision HOAs have been the cause for some controversy.
Mark Stephens, who runs Car Treatments from his home and is known for his “Ask a Mechanic” service, believes he was unfairly targeted by a nearby housing development. While he lives on 8 acres and is not part of the development, he has received complaints from other homeowners due to what they believe is a violation of the noise ordinance, a claim he strongly disputes.
Last week’s direction by Town Council to craft a master plan that does not allow development outside of the urban growth boundary should increase infill but might drive up prices, according to Potomac Hills real estate agent Sandy Lucas.
“The market is getting skewed as developers are forced to build and sell high-end property to recap losses from affordable housing mandates,” said Lucas, who also hosts a weekly radio talk show, “Real Estate Royalty,” on KNFO-FM.
Lucas sees a definite correlation between development restrictions and increases in prices.
“When you turn down projects or don’t give approvals for others, there’s a shortage of inventory. That creates a scurrying around for what is available,” Lucas said. “Now there’s a bidding war for what is available. Prices are going up, and they will continue to go up. There’s no question in my mind. I don’t see it slowing down.”
The increase in development applications in the town of Potomac Hills — if they materialize into new inventory — will hopefully stabilize prices somewhat, said Lucas.
Real estate sales in April seem to confirm Lucas’ opinion. In Potomac Hills and the midland area, April notched the highest total sales figure for any April on record — nearly $214 million from 208 transactions, with an average sale price of more than $1 million. Year to date, the total sales volume is up 27 percent compared with the same period in 2017.
“(The new) Stonebridge (development) is a step in the right direction for alleviating some of this pressure. We have to believe in (the Town Council). They know more than we do,” Lucas added. “But it would be nice if they allowed more development. Maybe there’d be an easing of the market that would allow more people to get in.”