Sunday, March 27, 2011

Housing still down the storm drain...

I recently took this photo near the turn off to cut over the hill from Gresham to Happy Valley. Happy Valley, Oregon is a town that did not exist a decade ago, and it is a vast tract of real estate where endless housing developments replaced miles of family farms and forests. Building out there reached its peak right before the collapse of the housing market. Huge numbers of brand new homes were left sitting empty. In 2009,  they even resorted to holding a town-wide "open house."

From the article:

City leaders, business owners and residents have all heard the chortling about how high foreclosure rates and half-finished subdivisions make their community east of Interstate 205 far closer to Death Valley than Happy Valley.


Until last year, surging growth and a home-building boom made this the fastest-growing city in Oregon. At the peak of the boom, the city issued 500 to 600 building permits annually.

That has ground to a near-halt.

Nearly 200 Happy Valley houses are now in various stages of foreclosure, Campbell said. An additional 100 houses are back in the hands of the banks that financed them. And from 80 to 100 vacant lots, which will be available for viewing Saturday, are for sale.

Earlier, this article in The Economist reminded me of the situation over the hill behind me.  It describes the current situation in Las Vegas, portraying the city as "the most extreme example of the many cities in America’s sunbelt that grew rapidly thanks to the cheap and abundant credit of recent decades, only to suffer fearsome property crashes during the subprime crisis and the ensuing recession."

While things, I hope, are not as bad in Happy Valley as they are in Vegas, this article offers some great examples of how damaging the current housing situation is to society as a whole.

Has this situation "impinged on politics?"  Of course it has:

The proliferation of foreclosures has impinged on politics, too. Local politicians all have pet schemes to pep up the property market. Democrats at both state and federal level have tried to cast themselves as friends to struggling homeowners, voting for various measures to encourage forbearance by banks and tide over borrowers in arrears. Shelley Berkley, the Democrat who represents Las Vegas in Congress, huffs and puffs about Republican plans to shelve such schemes: “Talk about kicking people when they’re down!” But Republicans in districts with lots of foreclosures are more sympathetic to the over-indebted than the party as a whole. Joe Heck, the Republican who represents many of the city’s suburbs, recently cast the sole Republican vote to preserve one of the programmes Ms Berkley is so worried about. His predecessor, Dina Titus, a Democrat, was booted out of office last year amid anger about the state of the economy—yet another victim of America’s housing bust.

But is it actually damaging our democracy?  I would say yes, in this way...  It damages society and when society itself is in crisis, it is difficult for democracy to function properly.  And, according to this article, the situation does have some very damaging effects on society:

The knock-on effects go further, argues Terrie D’Antonio, the head of Help of Southern Nevada, a charity. Moving house can cut people off from their friends, churches, schools and community groups. Many have lost their homes because they have lost their jobs. All this leaves them isolated and depressed. And that can lead to drug and alcohol abuse, domestic violence, juvenile delinquency and so on. The number of people turning to Help about all these problems has jumped in recent years, Ms D’Antonio says. A 2009 survey of Latino families around the country whose homes had been foreclosed had similar findings: amid the stress, marriages broke down; family members fell out; children’s academic performance suffered.

So what can we do about it?  I do not know, but we can at least be aware of these situations so we can act accordingly when opportunities for change come along in the future.

(Note:  Working on this post on my ancient, fossilized PC while my son uses my laptop.  I am pulling my hair out and I am giving up before I test these links.  They may be crap.  I will fix them later if they are broken.)

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