Desperate sprawl developer gives away cars with houses
by Sarah Goodyear.
My head nearly exploded at the breakfast table on Saturday morning.
I was reading a piece in The
New York Times about an Illinois developer who has finally found a way
to unload the new houses he has built some 50 miles from downtown Chicago, in a
place he has seen fit to dub a “Village of Yesteryear.”
When drastic price cuts weren’t enough to entice buyers, he
decided to throw in $17,000 cash toward the purchase of a car with every house. (That money can only be spent at the local General Motors dealer, of course—because, let’s go
So this is what it has come to. Developers are now giving away vehicles to entice
people to live in distant suburbs with life-draining
commutes just when gas is
hitting $5 a gallon. And a few consumers are biting—one is quoted as saying,
“My money was in the bank, collecting very little interest, so I thought I
might as well take a little gamble.”
Ah, yes, gambling on real estate. That’s the kind of
anecdote that makes you feel confident about America’s economic future.
article talks about how builders like Kim Meier, the guy behind the car
giveaway, are having trouble moving their newly constructed homes in a market
that is already glutted with buildings sitting empty:
of new single-family homes in February were down more than 80 percent from the
2005 peak, far exceeding the 28 percent drop in existing home sales. New
single-family sales are now lower than at any point since the data was first
collected in 1963, when the nation had 120 million fewer residents.
and analysts say a long-term shift in behavior seems to be under way. Instead
of wanting the biggest and the newest, even if it requires a long commute,
buyers now demand something smaller, cheaper and, thanks to $4-a-gallon gas, as
close to their jobs as possible. That often means buying a home out of
foreclosure from a bank.
out of 10 sales of existing homes are foreclosures or otherwise distressed
properties. Builders like Mr. Meier who specialize in putting up entire
neighborhoods on a city’s outskirts—Richmond is some 50 miles northwest of
downtown Chicago—cannot compete despite chopping prices.
Which raises the question: Why is this guy building more
houses way the hell out in the tenth ring of exurbs when he can’t sell the ones
he already has? Maybe “putting up entire neighborhoods on a city’s outskirts”
is not a good line of work to be in at the moment.
And aside from the fact that “new home starts” is the holy
grail of economic indicators, what’s so terrible about Americans wanting to buy
cheaper, already existing homes closer to their jobs? Isn’t that sensible?
Isn’t that only the normal thing to do? Isn’t that what simple economics would
tell us is a likely outcome of a market that has overbuilt homes in places where
people don’t necessarily want to live, dependent on one sole mode of transport—the automobile—that is becoming ever-more expensive to fuel?
Those foreclosed homes that people are buying, many of them,
were new just a few years ago. Should we now be throwing them away like used
tissue paper because we had an economic downturn? What about making use of the
resources we have already committed to those places—the roads, the sewers,
the utilities? Once those things are built, people start paying taxes to maintain them, and keep paying taxes—whether they’re being used or not. Or are our very neighborhoods becoming disposable
commodities, all so that we can keep notching “growth” on the economic chart?
Look, I understand that construction jobs are some of the
only decent-paying blue-collar options left. But if homes are sitting
empty and need to be rehabbed, is there any shame in doing that work instead of
building subdivisions from scratch?
There are first- and second-generation suburbs across
America that could potentially be retrofitted
and redeveloped into the type of livable, walkable communities that so many
consumers want. That would leave greenfields green and prevent the
construction of more highways at a time when we can’t maintain the highways we
have. And it would mean fewer visits to the pump.
For the last week, every time I have looked at the internet
or turned on the radio, the ranting about gas prices has been there waiting.
This time around, it’s usually accompanied with a teensy-weensy bit of
self-awareness—an acknowledgment that the story has been cycling around for
the last 30-plus years, and that the talking points have long ago been solidified.
But the next level of realization—that we need to fundamentally
rethink the way our housing and transportation infrastructure
are configured, and stop the sprawl—has for the most part yet to kick in.
As Transportation for America tweeted on
Monday, “Next week, R’s will suggest expanding oil exploration & supply.
D’s will try curbing ‘speculators.’ Both will completely ignore demand.”
It’s an atmosphere in which an NPR host can interview John Hofmeister, founder and CEO of the non-profit group Citizens for
Affordable Energy and former CEO of Shell Oil, for six full minutes about “What
is driving up oil prices”—and never once mention the role that sprawl
development plays in increasing demand and shackling America’s citizens to a
transportation system that is dependent on fossil fuels. In which the president, like that former oil exec, talks about alternative techologies and fuels, but not a rethinking of growth patterns.
An atmosphere in which the only way to sell a house is to throw
in a free car. Because the person who gets that car won’t be thinking about the
thousands upon thousands of dollars it will cost to fill it up over the years. Or the empty, angry hours
spent on the road and in traffic.
Until it’s too late.
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