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Loudoun Increases Cost of New Homes for Builders and Buyers


While neighboring counties and their officials are trying to help developers, builders and consumers weather the recession, Loudoun County is doing the opposite. In doing the opposite, Loudoun is taking money right out of the pockets of buyers, sellers and homeowners.

Here is what neighboring counties are doing:

  • The Montgomery County Council is considering delaying a proposed 3.5 percent increase in impact fees
  • In Prince George’s, the County Council has lengthened the life of development approvals and held off increasing impact taxes
  • Fairfax County has reduced the amount a developer must put up in surety bonds to guarantee a project’s completion
  • In the District of Columbia, lawmakers are allowing regulators to lengthen from two to five years the time developers have to begin work on projects in southwest Washington

What is Loudoun County doing?

  • Loudoun just raised proffers (the amount of money a builder must the county to build a home) by as much as 22 percent – $59,470 per single family home. The increases per type of property are $5,000 per apartment/condo; $11,000 per town home; $13,000 per single family home)

Who bears the brunt of these decreases and increases?

In the end, it’s consumers.

Here’s why…

If it becomes less expensive for a builder to build a home, the builder may offer greater incentives and/or lower base prices to create increased demand for their homes. The consumer wins and sales pick up.

If it becomes more expensive for a builder to build a home, the builder will most likely increase the base price and/or decrease incentives to make up for the additional cost. The consumer loses and sales slow down.

Sales picking up is better for homeowners and sellers. Sales slowing down is bad for homeowners and sellers.

Loudoun claims that the increase in proffers in necessary to pay for schools and public facilities. Ok…I get it. You need to pay for those things.

But why must those costs fall solely on the shoulders of home buyers? And why would Loudoun “OK” an increase in proffers (aka increase in the cost of buying a home) at a time when everyone and their mother is trying to lower the cost of buying and selling a home in order to stimulate the housing market?

Seems a bit backwards to me…

P.S. Supervisor Eugene Delgaudio (R-Sterling) was the only board member to oppose the motion.

On a side note, the increase in proffers is only for Eastern Loudoun. The proffers in Western Loudoun remained relatively unchanged. Hmmm…interesting.



2 Comments on "Loudoun Increases Cost of New Homes for Builders and Buyers"

  1. julie on Thu, 13th Aug 2009 12:29 pm 

    while I don’t love the idea of having to pay MORE to move to Loudoun, especially since I have my heart set on raising my family in Brambleton…what does the increase in proffers pay for, exactly? New schools? New roads? Or is it simply lining the pockets of LoCo officials? Just curious…

  2. Danilo Bogdanovic on Sun, 16th Aug 2009 4:41 pm 

    Julie – It’s supposed to pay for schools and roads. Basically, they need to make up for the deficit in the budget which 70 percent of pays for the school system. Have you already moved to Brambleton or not yet?

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