#30
1983
Brooklyn. Donna is sitting at the kitchen table as her roommate, Kelly comes in. It’s late. Kelly has been on a date. Her friend, Andrea, fixed her up. She’s really not happy with Andrea at the moment.
“So how was the date?”
Kelly groans
“That bad?”
“He talked about real estate for like, 90 minutes.”
“Real estate?”
“Yes.”
“That sounds painful.”
“No, what’s painful was his undying love of REO Speedwagon.”
“REO Speedwagon?”
“REO Speedwagon.”
“How does anyone work themselves up to forming a significant opinion about REO Speedwagon one way or the other?”
“Apparently it helps if you’re in real estate.”
“I thought this guy was supposed to be an intellectual. Didn’t Andrea say he studied poetry?”
Kelly rolls her eyes.
“Three times. Three times, Donna. Three times he referred to ‘Willams Carlos Williams.’ Williams. Carlos. Williams. ‘
Oh, and of course this is indicative of Williams Carlos Williams’ *search* for the American voice.’ I wanted to grab the ice pick from behind the bar and shove it through his eye.”
“Wow.”
“Yeah. He should’ve stuck to real estate. At least there I learned something.”
“Oh really? Does this mean you have a new agent?”
Kelly rolls her eyes. But then Kelly shrugs.
“Hey, can’t live here forever. I’ve been thinking about it for a month or two now. And he did sell me on buying sooner rather than later.”
“Wow, really? So he’s actually good at his job?”
Kelly scowls.
“Are you really gonna make me compliment this guy after he just sucked an entire night of my life away?”
Kelly sighs.
“But honestly, yes, he kind of is good at his job. Our lease is up in six months. I think I’ll really look into it.”
“Wow, big decision! What exactly did he sell you on?”
“Well he threw a lot of numbers at me, don’t ask me to remember all of them. And he really eased my mind about buying in the city. It used to be buying meant leaving the city. But he told me that's just not how it is anymore. He said something like 90% of all new development in major metropolitan blah-blah-blah is something he called infill? Like instead of just going to the edge of the suburbs and building more suburbs, with the way things are now- commuting's so expensive, and apparently taxes are different now, too for homeowners- they're mostly trying to build closer to where people work. Supply and demand, you know? So for example you know how they’ve been building those, uh, watchacallems...Levittowns? Out on the Island for decades now?”
“Sure.”
“Well apparently most of that has ground to a halt. I guess some must still going up, of course, but he said almost all of the new stuff in the boroughs are like rowhouses in Queens and outer Brooklyn now, or building apartment buildings closer in wherever there’s a vacant lot. People want to live near the subway more and more these days.”
“I guess that makes sense. It’s why we live by the station.”
“So anyone who invests in a house now is going to see the price go through the roof in the next ten years. They’re not making any more land.”
“Okay, real estate brokers
always use that line.”
“Maybe. But I need a place to live, anyway.”
“Ooh, so what kind of place are you gonna look at?”
“I dunno. I was thinking a rowhouse. He says they’re making plenty of those these days. That’s like the new standard. Out with the Cape Cod, in with the rowhouse.”
“Or how about a unit in one of those flashy new high-rises going up along the JMZ Line? That’s what I’d want.”
“Glamorous. But I want a family.”
“All those new buildings have family units.”
“Yeah, but there’s something about a yard. Even if it’s just 30 square feet. And you know I like to garden.”
“Sure, it’s your future, it should be what you want. So did you get his card?”
“Yeah. Huh, funny, you know he gave it to me without asking. And...you know what? He gave it to me when he said, ‘call me sometime.’ Like, not his home number, but his work number. And you know what?
You know what? Andrea was there three weeks ago at the book club when I said in passing that I might be looking for a place.”
“Hmm. You don’t think…”
“I’m starting to think.”
“So…”
“Yeah.”
“This wasn’t a date at all.”
“This son of a bitch was just trying to drum up business.”
“Huh.”
“Ugh.”
“Vodka?”
“Vodka.”
----
March 17th, 1983
Wall Street Journal
Headline: Cities Win as Recession Ends
Subhead: But New Challenges Limit Success
The nation officially exited its 14-month recession in March, posting anemic GDP gains of less than 1% (.8% to be exact) with unemployment hovering around 11%.
But even this toehold onto stability evaporates when regional variance is accounted for. While urban centers have recovered strongly, a majority of suburban counties remain in localized recessions. Rural areas are coping with a mixed bag that includes stabilized GDP growth and wages but with an increase in out-migration as rising expenses outpace other indicators.
Much of the unevenness of the recovery has been laid at the feet of the bargains struck between congress and the Anderson administration at the start of his term in office. In particular, the combination of the tax code overhaul and the Gas Emergency Tax has been noted for shifting the nation’s economic growth away from the suburbs and back to the cities.
The creation of a universal Housing Tax Credit has changed the nature of home loans from catering to fewer, larger mortgages to many more smaller mortgages. While this might seem ideal for cheap land in the suburbs, the high price of gas and changing tastes has made long commutes economically impossible and undesirable for many.
Catering to these shifts in the market, the housing sector responded with cheaper, denser housing in cities and inner suburbs, taking advantage of the new federal push to desegregate established neighborhoods by subsidizing new construction. 45% of housing starts over the last two years have occurred within the borders of cities with a population of over 100,000. When inner suburbs- here defined as areas no more than 5 miles from the central city- are accounted for, the total rises to 80%. Most of the remaining 20% is occurring around smaller cities and dense small towns.
Barely any virgin land, detached subdivisions of the type that have dominated the housing market for the last 50 years are being built. This reverses a trend that began in 1924 and has accelerated up to the late 1970s, wherein the suburbs were responsible for a growing share of housing construction while cities and towns flat-lined. Only the slow housing market from 1978-1981 may have prevented a disastrous over-supply of unwanted housing stock in the far-flung suburbs.
Still, many people feel like they are stuck in their suburban homes these days, unable to afford gas prices, yet also unable to afford to sell and take a loss on their primary investment. At the same time, the federal government continues to present home ownership as an investment opportunity to grow the middle class- a path to eventual prosperity for millions. Now, it’s unclear whether those who bought within the last ten or fifteen years on the fringes of suburbia are going to see those bright futures.
Even as virgin land suburbs peter out, there exists the potential for a dramatic housing shortage now, as many cities are having trouble keeping up with demand. Housing prices are rising rapidly in the core and inner-suburbs in most major metro areas.
While some cities are meeting this problem by building unprecedented amounts of housing, others are facing a backlash from denizens wary of new residents or of being priced out of their own homes.
Nationally, lawsuits have halted or delayed more than 250,000 units of housing over the last two years, almost all of the suits brought to court by pre-existing residents. Efforts by local officials to enact new zoning codes that preclude new development have mostly been met with lawsuits from the powerful Civil Rights Division of the Justice Department, but that hasn’t stopped some localities from trying the tactic.
Among the ten largest metro areas, no particular factor seems to determine whether a city will be pro-growth or protectionist. The inertia of behemoth New York means it cannot readily adapt to changes in demand, and housing starts in the Five Boroughs have increased only modestly over the last year. Meanwhile, already-booming Phoenix has only had to alter its zoning codes to allow greater density in order to keep the growth rate it maintained through the 1970s. While many neighborhoods have protested, this is a city with a particularly strong real estate lobby, able to fight on every front and get plenty of new condos on the market even in the face of frequent lawsuits.
Philadelphia, San Diego, Houston, and Detroit have all seen large-scale attempts to hit the brakes on "non-traditional" housing starts, with varying degrees of success.
Meanwhile, Los Angeles is in the midst of an unprecedented construction boom, building more densely than that city has ever attempted. Chicago recently drafted a new city plan that will see hundreds of thousands of new units of housing added over the next ten years. Joining them on the pro-growth bandwagon are Dallas and, to a lesser extent, Baltimore.
Where some cities are wary of growth, others welcome it. This is particularly true of smaller cities- old industrial centers in places like Pennsylvania, Ohio, and Upstate New York, places whose population peaked in the 1940s or even earlier. There, the resurgence is being welcomed as a lifeline for dying communities.
Scranton, PA is one such city. Suffering a loss of industrial and mining jobs over a 40-year period beginning just after World War II, the city began a slide from 140,000 people in 1940 to 88,000 in 1980. The city’s famed trolley lines ceased to be economically viable and were shut down in the 1960s. New housing fled beyond the city’s borders to take advantage of highway proximity, far-flung office parks, and planned shopping malls.
Now, those malls may never be built. Suburban office parks are shuttering one-by-one as rising logistics costs make them unsustainable. New leases are increasingly being signed in the old Scranton business district as building after building is refurbished and reopened for business.
Meanwhile, developers have made a deal with planned tenants and city officials to turn a largely-abandoned section of downtown Scranton into a new “Urban Shopping Plaza.” Announcements for a dozen housing projects totaling 8,800 units in the immediate vicinity followed on the announcement of this project. Economic activity is returning to the American Mainstreet.
More than 90% of the far-flung suburban developments in Lackawanna County have been scrapped, and a corresponding number of rowhouses, duplexes, and small-to-mid-sized apartment buildings are going up closer to the heart of Scranton and other small towns connected by the county bus system.
Today, the population of the city is estimated at over 90,000 and is on track to hit 100,000 as early as 1987. Plans to relaunch the trolley system are being dusted off, and a regional rail line to Wilkes-Barre, Allentown, and Philadelphia will break ground later this year.
Scranton’s success is far from an isolated phenomenon among smaller cities. With more distant suburbs untenable and larger cities often constrained by market or political forces, the All-American hometown is once again finding its moment in the sun.