walkitout (walkitout) wrote,
walkitout
walkitout

Once Upon a Time, or, People Moving

Once upon a time, around when I was born, several things happened that changed where people with money and other resources (like, access to mortgages and other forms of credit) chose to live. One of those things was desegregation and, related to that, busing to integrate schools within cities. Combined with a bunch of federal home loan programs that had the effect of making it hella easier to get a mortgage on a free-standing single family home in the suburbs, than anything in the city (much less a mortgage on a unit in multi-family housing), the result was White Flight. There was a lot of loose talk about how bad this was. It was really, really bad. Ignoring for the moment the isolation of middle-class white mothers and their children, the lack of access to public transportation, the rise of the two-car family, the two-income family and the empty suburb and severely curtailed dometic life, the impact on the climate, blah, blah, bleeping blah. Ignore all that. Ignore, if you can, for a moment, how tough it became to overcome the hypersegregation that resulted (before, people lived near people of other backgrounds -- now they were separated by huge distances). Let's focus instead on what happened to all that housing in the city.

In some cities, notably Boston, people were very, very thick upon the ground during the 30s and 40s and 50s. At first, spreading out got back down to where things had been before the 1929 Crash -- not such a bad thing. But then it started really emptying out.

Just as California is subject to hordes of people moving in and out (probably because there are so damn many people in California, thus, an average rate of in and out activity is, in gross terms, massive -- but I bet they have a higher rate of in and out activity anyway), so, back in the day, were the cities of the Northeast. When the hordes started leaving NYC, some of the boroughs developed such an arson problem that the city basically sold properties to squatters who were willing to live there. For extremely low amounts of money. They were ecstatic if the squatters had utilities, but they were not picky.

That was the decade when the Cool Kids Colonized the Village.

Maybe a decade or so later, Yuppies Came to Town. That was kind of interesting, as properties started leaving rent control and the market tried to come up with a valuation on new co-ops in old buildings. Stratospheric prices. Big crash. Eventually some stability. After a while, people started actually putting together brand new buildings in those abandoned lots where arson had wiped out century plus old apartment buildings. It became apparent NYC that there was a real, long-term trend to move back into the city.

Similar things happened in Boston at about the same time. The Combat Zone of the 1970s and the 1980s had shrunk by the time I visited -- you could walk through it during the day without fearing for your life, altho you probably shouldn't be there at night. By the time I visited Boston in the mid 1990s, it was gone. Now, the place is so pedestrian friendly that severely underdressed college kids wander around all seasons of the year. They not only don't worry about crossing at the intersection with the light -- they step off far from any intersection or crosswalk without looking and expect the cars will stop for them (which they do). Very, very, very safe place.

In San Francisco, the Haight went from being Land of Drugged Out Squatters and all kinds of interesting people to massively overpriced condos. In Seattle, as always, things lagged a bit. But similarly, where in the 1990s the crips and the bloods were shooting it out on Rainier Avenue, by the middle of the Aughties, condos and "luxury apartments" were sprouting up. Most of my readers have some sense of what happened first when Pike Place Market was saved from developers who wanted to raze it (in favor of developers who instead co-opted it), then Pioneer Square went from land-of-questionable-subleased artists lofts to, once again, outrageously expensive co-ops and condos.

Hell, even Ballard has been colonized.

Here's my point. When people were moving out of Ballard, the Haight, Cambridge, the Village, etc., there was a big change. Depending on the location, it was like taking what you thought was a short step into the elevator and instead falling down the shaft. You went from endless demand for limited supply for housing units (mostly apartments), to rapidly disappearing demand (that had a variety of problems like, non-payment, not to mention unsavory activities to come up for what rent was paid) for what increasingly felt like infinite units. While people did eventually move back into Ballard, the Haight, Cambridge, the Village, etc., _and spent serious money to do so_, that money did not go (with rare exceptions) into the hands of the people whose income stream dried up when the cities emptied out.

For some landlords, arson made really good sense. They couldn't lease the units. They couldn't sell the building. They couldn't pay the taxes. Even without collecting insurance, at least their property tax liability went down when there wasn't any functional building left. A lot of that property was abandoned to the city. (I might further add that this phenomenon is by no means limited to the US, much less the cities I mention. Virtually the same phenomenon over a similar time frame happened in Amsterdam.) There are buildings with continuous ownership (and continuous renting relationships) in NYC, largely an artifact of rent control there and the ability to "inherit" a rent controlled unit. (San Francisco saw this too, albeit to a lesser degree. While everyone freaks out about rent control in boom years, it's worth noting the stabilizing effect rent control has over time. Which is what it was for, sort of.) For those landlords, what happened was essentially the end of the world. For the people who came in a decade or three later, they were sowing in land long fallowed.

When I, then, read this:

http://www.calculatedriskblog.com/2009/03/la-times-housing-development-sites.html

I don't just see more-of-the-same: arson and scavenging occurring in abandoned housing. I also see a basic flaw in expectations:

"Some of these units have been mothballed (with fences and guards), others essentially abandoned. This is just more supply waiting for the market to improve."

For practical purposes, this isn't supply waiting for the market to improve. By the time the market improves, there won't be "supply" anything left in these abandoned developments. Electrical service and sewer will have to be redone. Maybe even foundations redone. A lot of debris trucked out. This is also apparent in the "trashout" business in SoCal. When people lose their houses, they have a lot of time to move their stuff to wherever they are going. But for a variety of reasons, they often do not move their stuff: they abandon it. Just like a lot of stuff was found abandoned in those empty, dangerous NYC buildings when Luc Sante came in, written about quite eloquently in _Low Life_. There are so many abandoned houses with so much abandoned stuff that charitable operations cannot keep up and have become very, very picky at what they take. Instead, it all gets landfilled (even the guys dumpstering it don't take much if anything; they've seen too much go by).

It's a little sad. The Green among us try to recycle foil and reuse rubberbands. Meanwhile, thousands of households worth of stuff is tossed in the landfill because the collapse is happening too fast to sort through it.

And hey! I didn't even get into Peak Oil in this. Cause it's basically not necessary to explain the larger trend of moving back into the city.
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