The next slum?

[babylonsister]

The subprime crisis is just the tip of the iceberg. Fundamental changes in American life may turn today’s McMansions into tomorrow’s tenements.

by Christopher B. Leinberger
The Next Slum?


Strange days are upon the residents of many a suburban cul-de-sac. Once-tidy yards have become overgrown, as the houses they front have gone vacant. Signs of physical and social disorder are spreading.

At Windy Ridge, a recently built starter-home development seven miles northwest of Charlotte, North Carolina, 81 of the community’s 132 small, vinyl-sided houses were in foreclosure as of late last year. Vandals have kicked in doors and stripped the copper wire from vacant houses; drug users and homeless people have furtively moved in. In December, after a stray bullet blasted through her son’s bedroom and into her own, Laurie Talbot, who’d moved to Windy Ridge from New York in 2005, told The Charlotte Observer, “I thought I’d bought a home in Pleasantville. I never imagined in my wildest dreams that stuff like this would happen.”

In the Franklin Reserve neighborhood of Elk Grove, California, south of Sacramento, the houses are nicer than those at Windy Ridge—many once sold for well over $500,000—but the phenomenon is the same. At the height of the boom, 10,000 new homes were built there in just four years. Now many are empty; renters of dubious character occupy others. Graffiti, broken windows, and other markers of decay have multiplied. Susan McDonald, president of the local residents’ association and an executive at a local bank, told the Associated Press, “There’s been gang activity. Things have really been changing, the last few years.”

In the first half of last year, residential burglaries rose by 35 percent and robberies by 58 percent in suburban Lee County, Florida, where one in four houses stands empty. Charlotte’s crime rates have stayed flat overall in recent years—but from 2003 to 2006, in the 10 suburbs of the city that have experienced the highest foreclosure rates, crime rose 33 percent. Civic organizations in some suburbs have begun to mow the lawns around empty houses to keep up the appearance of stability. Police departments are mapping foreclosures in an effort to identify emerging criminal hot spots.

The decline of places like Windy Ridge and Franklin Reserve is usually attributed to the subprime-mortgage crisis, with its wave of foreclosures. And the crisis has indeed catalyzed or intensified social problems in many communities. But the story of vacant suburban homes and declining suburban neighborhoods did not begin with the crisis, and will not end with it. A structural change is under way in the housing market—a major shift in the way many Americans want to live and work. It has shaped the current downturn, steering some of the worst problems away from the cities and toward the suburban fringes. And its effects will be felt more strongly, and more broadly, as the years pass. Its ultimate impact on the suburbs, and the cities, will be profound.

Arthur C. Nelson, director of the Metropolitan Institute at Virginia Tech, has looked carefully at trends in American demographics, construction, house prices, and consumer preferences. In 2006, using recent consumer research, housing supply data, and population growth rates, he modeled future demand for various types of housing. The results were bracing: Nelson forecasts a likely surplus of 22 million large-lot homes (houses built on a sixth of an acre or more) by 2025—that’s roughly 40 percent of the large-lot homes in existence today.

more...

http://www.theatlantic.com/doc/200803/subprime

[gateley]

1. I heard an economist (or some "smart person") on the radio say that the

McMansions would become boarding houses.

[babylonsister]

2. Damn scary, isn't it.

And what about the people being displaced? :scared:

OTOH, boarding houses would provide a lot more room for the homeless who need a place to live. It's a thought...

[gateley]

6. I agree about the homeless -- that was my first thought too. And, I think

many more of us will become a part of that category in the not too distant future.

:cry:

[Lydia Leftcoast]

3. About ten years ago, a talk show host in Portland

named Joe Uris (on community radio station KBOO) was calling the McMansions "the slums of the future."

It was obvious to anyone who really thought it through, which most purchasers obviously didn't.

[DesertFlower]

4. we have houses here that have been

for sale for a year or even 2. i'm starting to see signs on them saying "for lease".

[Warpy]

5. Big, ostentatious tract houses aren't selling much of anywhere

People are facing a declining standard of living and they know it. The thought of heating and cooling one of those behemoths is too much for sane people and they're just not buying any more.

Post WWII crackerboxes in my area are selling well. They're cheap to heat and cool and centrally located. More people are starting to find them appealing.

[angrycarpenter]

7. I have been building luxury beach houses for years

And I have done some beautiful custom work in them. But I would have rather been building sensible houses. I hate waste and a 5000 sqft house for a couple and a baby is obscenely wasteful.

[pop goes the weasel]

8. this is what I have thought, too

When I'd see these ridiculous large houses go up, I knew they couldn't be re-sold and that most of the owners couldn't afford them if the economy slipped even a little. The only thing they could ever be is tenements and boarding houses. And even then, because of how they are built, most of them will need considerable re-modeling, and probably gutting every ten or fifteen years. Hey, just like mobile homes! Welcome to the trailer park, suburbanites!