Plowing it under: Part 2, the how
Continued from yesterday’s Part 1.]
In yesterday’s depressing blog post, we visited beautiful distant Victorville,
Over the mountains on the road to Vegas: isolated Victorville
A new-construction development in Victorville is being dismantled, as reported in this Los Angeles Times story, because holding the property has become more expensive thanks to the perverse consequences of a recent anti-foreclosure California law, SB 1137.
This may not be what Victorville wants, but it’s what Victorville is getting:
The image Victorville presents of itself: happy people developing land!
(Scrolling banner from the City of Victorville’s Web site)
The lender is tearing down the property because it now has negative holding value (and thus, potentially, negative equity), and the city (spokeswoman Yvonne Hester) seems blind to the potential opportunity for affordable housing.
The development was in a part of town remote even for Victorville, a wind-swept high desert city of about 100,000 residents.
Famous for its Route 66 Museum
In more urban areas, lower-maintenance properties like office buildings are being ’saran-wrapped’ – completed, then sealed and held 100% vacant in the expectation that sometime soon they will be worth renting. That’s harder for single-family homes, each of which must be protected by an occupant.
Individually wrapped for your protection
However, it’s all but impossible to protect an uncompleted (and hence unoccupiable) property except with round-the-clock security guards.
Anything can happen if nobody’s watching.
A dozen of the homes were in various stages of construction. Some had frames erected, and a few others had drywall hung, said Jorge Duran, Victorville’s code enforcement manager.
The four finished homes, however, were richly appointed with granite countertops, whirlpool bathtubs and dual-pane windows.
Now they will be disassembled and sold for body parts.
Building permits were issued in September 2007, Hester said.
Development is like the tide: it rolls in to new
Dear Mr. Bogart, you are the last developer in
Home prices were already falling, but in
This developer was in the unlucky position of being the last, worst optimist.
“These Egyptian properties are NOT vacant!” shouted Tom, deep in denial
Construction halted in the summer of 2008, and the homes became a nuisance, attracting vandals and squatters, Hester said.
A home is an organism defended by its occupants. If there are no occupants, the home is defenseless.
The city first cited the developer for failing to maintain the property in July, Hester said.
Notice that
“People were taking sinks, the air conditioners. For someone who wanted to do no good, it provided an opportunity,” she said.
There’s something hideous about the slow looting of a helpless white elephant.
Dead but still got some tasty bits
The bank repossessed the development in August, Hester said. Demolition permits were granted April 9.
This is
The wrecking crew showed up near the end of the month. Forrester was not officially part of the demolition team. His nephew, who got him the job, operated the backhoe that tore through the houses with the destructive ease of a mechanical Godzilla.
Easy on the symbolism, guys!
Anyvon referenzing de Terminador vill be destroyt
Forrester’s job was to chase vandals away and sell what he could to bargain hunters.
“uh, gentlemen, could I interrupt your pillage for a moment?”
Very strange profession, like the caretaker in an empty hotel.
Eviction time!
He slept in the model homes until, one by one, they were gone. By Friday, the crew was on the last house — a hulking two-story model with a floor plan blown open by demolished exterior walls.
The place looked as if it had been hit by a hurricane, but it was only the splatter of the burst housing bubble. Folks driving by on U.S. 395, the highway from Hesperia to
Scavenging, however informal, is a natural human trait that finds its expression in the ragpickers who make a tiny living in the world’s large cities.
Indian ragpicker
Forrester was happy to oblige them. Whatever they would take “saves the dump fees,” he said. “I gave one guy a granite counter for $40, gave another dual-pane windows for $20 a piece.”
In effect, the unit value of each item is depressed by the search/ carrying costs of finding the buyer. Bargains by the roadside achieve the same purpose.
A fellow with a dually pickup and trailer showed up asking for some studs. He declined to be interviewed, nor did he want to talk about what he would use them for. Used building materials are prohibited for use in new construction, so lumber from the site would have to be for personal projects.
Again, note the unintended consequence of a well-intentioned law. What is ‘used’? When we were fitting out our new offices, we were able to buy ‘used’ work stations that had, in fact, never been uncreated from their boxes and assembled; they’d been delivered to a law firm who no longer needed them, and resold for a fifth of their retail price.
Forrester sold him a trailer full of 2-by-4s for $40.
This is an important phenomenon; manufactured goods are reused, and in the arbitrage between retail price and resale price, the market clears. Markets always clear, markets must clear, and the faster they clear, the better.
(We are having a problem now in LIHTC because the market’s clearing is being inhibited by the above-market tax credit exchange program about which I’ve fulminated elsewhere.)
A bit later, Marla Bowers and Candy Sweet drove up, also looking for lumber. Bowers said she wanted to build a shed. Sweet needed to repair some termite damage.
“A dollar for clean ones, 50 cents if they’re dirty,” Forrester offered. When Bowers hesitated, Forrester lowered his price. They settled on a six-pack of
Ron Willemsen, president of Intravaia Rock and Sand, the
“It’s a waste of a lot of resources and perfectly good construction,” he said.
If you can’t move it in toto, then you have to disassemble it and move the pieces.
This isn’t cheap either
Willemsen, whose family has run the business for 50 years, said it was the first time the firm had demolished a new housing project to return a potential neighborhood to soil.
Typically, the company demolishes vacant properties when they’ve outlived their usefulness and other construction projects are set to take their places.
His firm also recycles the demolished structures, as it will these former dream homes. The concrete will become base material for parking lots and roads, the wood chipped into mulch.
“Have you seen the side of the 210 Freeway?” Willemsen said. “That’s our product.”
And its epitaph:
July 4, Gettsyburg, 1863
Pile the bodies high at
Shovel them under and let me work –
I am the grass; I cover all.
And pile them high at
And pile them high at Ypres and
Shovel them under and let me work.
Two years, ten years, and passengers ask the conductor:
What place is this?
Where are we now?
I am the grass.
Let me work.
– Grass, by Carl Sandburg
Let me work …
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