Suburbia RIP

Discussion in 'Wall St. News' started by marketsurfer, Mar 15, 2009.


    The downturn has accomplished what a generation of designers and planners could not: it has turned back the tide of suburban sprawl. In the wake of the foreclosure crisis many new subdivisions are left half built and more established suburbs face abandonment. Cul-de-sac neighborhoods once filled with the sound of backyard barbecues and playing children are falling silent. Communities like Elk Grove, Calif., and Windy Ridge, N.C., are slowly turning into ghost towns with overgrown lawns, vacant strip malls and squatters camping in empty homes. In Cleveland alone, one of every 13 houses is now vacant, according to an article published Sunday in The New York Times magazine.

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    The demand for suburban homes may never recover, given the long-term prospects of energy costs for commuting and heating, and the prohibitive inefficiencies of low-density construction. The whole suburban idea was founded on disposable spending and the promise of cheap gas. Without them, it may wither. A study by the Metropolitan Institute at Virginia Tech predicts that by 2025 there will be as many as 22 million unwanted large-lot homes in suburban areas.

    The suburb has been a costly experiment. Thirty-five percent of the nation's wealth has been invested in building a drivable suburban landscape, according to Christopher Leinberger, an urban planning professor at the University of Michigan and visiting fellow at the Brookings Institution. James Howard Kunstler, author of "The Geography of Nowhere," has been saying for years that we can no longer afford suburbs. "If Americans think they've been grifted by Goldman Sachs and Bernie Madoff, wait until they find out what a swindle the so-called 'American Dream' of suburban life turns out to be," he wrote on his blog this week.

    So what's to become of all those leafy subdivisions with their Palladian detailing and tasteful signage? Already low or middle-income families priced out of cities and better neighborhoods are moving into McMansions divided for multi-family use. Alison Arieff, who blogs for The New York Times, visited one such tract mansion that was split into four units, or "quartets," each with its own entrance, which is not unlike what happened to many stately homes in the 1930s. The difference, of course, is that the 1930s homes held up because they were made with solid materials, and today's spec homes are all hollow doors, plastic columns and faux stone facades.

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    There is also speculation that subdivision homes could be dismantled and sold for scrap now that a mini-industry for repurposed lumber and other materials has evolved over the last few years. Around the periphery of these discussions is the specter of the suburb as a ghost town patrolled by squatters and looters, as if Mad Max had come to the cul-de-sac.

    If the suburb is a big loser in mortgage crisis episode, then who is the winner? Not surprisingly, the New Urbanists, a group of planners, developers and architects devoted to building walkable towns based on traditional designs, have interpreted the downturn as vindication of their plans for mixed-use communities where people can stroll from their homes to schools and restaurants.

    Richard Florida, a Toronto business professor and author of "Who's Your City?: How the Creative Economy Is Making Where to Live the Most Important Decision of Your Life," argues that dense and diverse cities with "accelerated rates of urban metabolism" are the communities most likely to innovate their way through economic crisis. In an article published in this month's issue of The Atlantic, he posits that New York is at a relative advantage, despite losing a chunk of its financial engine, because the jostling proximity of architects, fashion designers, software writers and other creative types will reenergize its economy.
  2. Thanks for the post... interesting stuff
  3. Dammit Surf!
    Gotta link dude?

    EDIT; Never mind, I found it. Thats 3 minutes of my life gone, thats right gone.

    All because I had to type into a goog. search box, and then scroll, and then.. oh forget it.

    clicking links is just easer. You task master.
  4. Heck yeah, let's move to the San Jauquin Valley, record highs for July are 114 degrees with .05" of rain.. relentless heat day and night in the summer is what they have there... people are leaving uninhabitable areas that have no jobs, what next, turn the houses into section 8 wonderlands like they did with the Mojave Desert?? There is always something positive going on, with the Section 8rs and their gangbanger offspring moved to the horrid hot places in California it makes room for the Latino Gangs... wait, that's not positive.. oh never mind...
  5. I bought a rundown mansion in 1993, back when no one wanted one ( on the market for 9 years previous ). sold it in 1997, for a small profit--- 2 more years of holding, the profit would have been substantial. This article gives me the idea that this could be done again very soon..... this time i hope to hold for the right time without getting shaken out....

  6. Here is another article on the same issue:

    The Brokest Generation
    Our kids are the ultimate credit market, and the rest of us are all pre-approved!

    By Mark Steyn

    Just between you, me, and the old, the late middle-aged, and the early middle-aged: Isn’t it terrific to be able to stick it to the young? I mean, imagine how bad all this economic-type stuff would be if our kids and grandkids hadn’t offered to pick up the tab.

    Well, okay, they didn’t exactly “offer” but they did stand around behind Barack Obama at all those campaign rallies helping him look dynamic and telegenic and earnestly chanting hopey-hopey-changey-changey. And “Yes, we can!”

    Which is a pretty open-ended commitment.
    Are you sure you young folks will be able to pay off this massive Mount Spendmore of multi-trillion-dollar debts we’ve piled up on you?

    “Yes, we can!”

    We thought you’d say that! God bless the youth of America! We of the Greatest Generation, the Boomers, and Generation X salute you, the plucky members of the Brokest Generation, the Gloomers, and Generation Y, as in “Why the hell did you old coots do this to us?”

    This is the biggest generational transfer of wealth in the history of the world. If you’re an 18-year old middle-class hopeychanger, look at the way your parents and grandparents live: It’s not going to be like that for you. You’re going to have a smaller house, and a smaller car — if not a basement flat and a bus ticket. You didn’t get us into this catastrophe. But you’re going to be stuck with the tab, just like the Germans got stuck with paying reparations for the catastrophe of the First World War. True, the Germans were actually in the war, whereas in the current crisis you guys were just goofing around at school, dozing through Diversity Studies and hoping to ace Anger Management class. But tough. That’s the way it goes.
  7. 377OHMS


    I'm all in now on a similar type bet. I think the key thing is to make sure you really like the property so that it isn't a burden if you have to hold it for 5-10 years.

    Mine is closer to a 20-year bet. It actually appreciated 10% between July 2006 and November 2008 (bank appraisals) so it is possible that I'm going be ok in the long run.

    Fwiw, I'm noticing some of the empty houses in town no longer have a for-sale sign and many seem to have renters moving in. I'm not entirely sure what that means but I suppose it is better than seeing those homes boarded up.

  8. cool, good luck! i loved the place, just didnt have the capital or access to hold on to it. the property drained me of cash, upkeep, utilities, etc were unreal. i kick myself often for not forgoing some upkeep/maintenance and holding for several more years....
  9. 377OHMS


    Oh man I hear you. I had to replace the slate roof last year. More than 25% of the total value of the property. Ouch. I also have the State forcing me to carry 2.5M liability insurance because of "precarious rock formations" on the property. Wtf? Its being pointed out to me by Los Angeles county waterworks that I'm the largest water user in the valley and am being singled out for some punishment there. Less than 20% of the property is landscaped and I already got rid of a pond and a huge lawn! <shrug> I feel like a freaking target.

    Still, its manageable and I like the place. But if there really was a depression I could run into some no-kidding trouble.

  10. I know exactly what you mean. Fortunately, the county/town left me alone, but contractors, etc always seemed to give me the "rich guy" discount by adding a zero or two to every estimate!
    #10     Mar 15, 2009