(Published at Counterpunch.com) Today’s Miami Herald’s “Foreclosures haunt condos” (January 9, 2008) outlines the macabre turn of the condo real estate market and ends with a good news spin, even if it does make the quoted sound like a madman. The Club at Brickell Bay condo owner says, “This is Manhattan, it’s the future Manhattan, so we’re all sitting real good.”
I recall, on “sitting real good”, they said the same on the Titanic.
That sinking feeling is growing widespread across the nation. The biggest mortgage lenders like Countrywide are on the verge of Bankrupcy. Citigroup is writing down a further $16 billion in mortgage-related losses. Production homebuilders are staggering under the weight of losses, too. The stock market indexes are falling faster than the temperature gauge in winter. But insolvency is more than a passing cold front.
According to a blogger/real estate professional quoted by the Herald, “An 818 square foot unit, which sold in June of 2006 for $430,000, was listed Monday for $220,000.”
If these small examples of Miami condo market depression are the tip of the iceberg, what does the rest of it look like? To me, it looks a lot like faces of the people we elected to public office– from lowly city and county commissioners straight up the totem pole.
Miami may not be unique in this respect: instead of caring about its existing tax base– taking care of the needs of the poor, of the taxpayers who already live here, of our quality of life and infrastructure– most elected officials are busy chasing rainbows like the biggest speculative bubble in housing in history, or if they are not chasing rainbows and the pot of gold at the end of it, they’re inventing multi-billion dollar infrastructure projects to paper over the billions of dollars in infrastructure deficits they have failed to fund.
In other words, now the talk in government circles turns to “economic stimulus” packages, such as the $3 billion Miami plan that works only by deforming the purpose of Community Redevelopment Agencies, meant to serve the disadvantaged. Oh well.
If I were the editor of the Herald, I’d pay more attention to the experience of the real estate professional who recently sent a letter to the Florida of Department of Community Affairs outlining her horror at what Miami Dade has turned into:
“As a Realtor, I have 21 listings. Virtually all of the families they represent are leaving South Florida if not the state. The reason is not our lousy weather. It is the fact that the gridlock we have created from paradise precludes any measurable quality of life.
Whether it is the hours long and increasingly expensive commute to work and jammed schools across hopelessly crowded highways, the lack of employment affording a livable wage or prospects of a middle class existence, the absence of healthcare for all but lucky corporate employees, the result is the same: regular hardworking families have been robbed of the American Dream. Worse, they are trapped in their concrete cells which are worth less than they paid just a year or two ago.
These folks are competing with investors who bought in new developments which will never become communities. Instead, they are surrounded by vacant foreclosures and subsidized rental properties. I assure you, it is nearly impossible to find a buyer who will risk his or her family’s assets in areas like this.
Worse, the mounting foreclosures (one property in every thirty in Dade County), put the hapless seller in competition with institutions with far deeper pockets. You can drive the areas of South Dade’s newer developments for miles and possibly see just a few occupancies per block. Of those, few are owner occupants.
It would be criminal to offer up ANY precursor to additional development in Dade County unless and until ALL land within the UDB is totally built out with proper infrastructure in place (schools, police, fire department, roads, water and sewer, trash, etc.), essentially, not before 2015 or later. It is unfortunate that you of the DCA are put in the position of exercising the common sense that our local officials have chronically lacked. Nonetheless, please know that the buck stops with you and that thousands of citizens are counting on you to do what our elected officials have failed to do for years. Thanks in advance for stopping the idiocy.”
Back to today’s Herald story, I would have closed on the note that appears toward the end of the article, on struggling community associations, “unkept grounds and disruptions in services.” The weeds can’t obscure all the damage done by so much poorly planned concrete.
It is inescapable that the budget crisis affecting unsustainable development is going to spread to city and county budgets, in Florida and across the nation. Who could have guessed that the 2008 presidential election is going to turn on an economy that is spinning without a propeller.
Pockets of prosperity will continue to float above the turmoil– after all, that is what the fomenters of the housing bubble have been saving for.
It is not as though they couldn’t see it coming.