I recently had a chance to talk with a real estate agent who has many years of experience. He’s seen ups and downs, and knows what it looks like when an entire city is on its knees or reaching to the sky with great cranes working downtown. The latest cycle? It doesn’t surprise him one bit.
His bigger picture attitude didn’t surprise me, but when it got to specifics things were a bit rough. I mentioned a 700 square foot townhome that couldn’t sell at nearly any price, and the response was deadpanned back. “There are a lot of obsolete houses out there.” Obsolete?
“It’s like the neighborhood we’re talking about taking down 25 houses or so,” referring to a district council action that is pending. “Many of those are never going to be viable. Perhaps they were once, but they aren’t now. They’re just too small and cut up into tiny rooms.”
Talk of obsolete houses quickly turns into obsolete communities. After all, entire neighborhoods are built at the same time, whether 150 years ago or today. They reflect the standards of their time, and we like to live in a lot more space than people did back many years ago. Perhaps if this was another city, tiny houses of less than 1,000 square feet would work. Not here. Not now.
What do you do when an entire community is obsolete and needs to be torn down? If you’re lucky enough to catch this in an up market, the private sector might do it. Sadly, the foreclosures come in a bunch when the market is down. Only the government can possibly pull the scratch together to scrape a whole block in those times.
The effect is wrenching. Displacement and loss of history is the order of the process. Loss of identity naturally follows if you do it badly. Holding on to what makes the community what it is can be very difficult. Despite the presence of bulldozers, this is more like heart surgery than demolition. But like heart surgery, it has to be done.
Over the long haul, things do even out. But when the hammer falls, it usually hits the people who are already living on the anvil. The latest real estate downturn is creating more than hardship. It is making obsolete houses which together can become obsolete communities. Unchecked, it eventually will make obsolete people. That’s when trouble will really start.
The fallout has only begun. It’s up to us to respond now.