Pinched (12 page)

At the peak of the market, housing construction and related activities accounted for more than a quarter of the economy in Phoenix and Las Vegas, and 30 percent in Orlando. Florida posits that these cities, among others hit especially hard by the housing crash, may never recover. The very nature of their attraction has left them with large populations, but not an especially high level of human capital; the country’s economic elite have for the most part clustered elsewhere.
So, too, have recent immigrants with high economic potential. According to the Brookings Institution, relatively highly educated immigrants have crowded into places like Seattle, Minneapolis, San Francisco, and New York. By contrast, “immigrants with the lowest levels of English language ability and educational attainment cluster in Texas, inland California, and Sunbelt markets that experienced fast growth during the decade’s housing boom.” With the mirage of opportunity in these places dispelled, revealing shrunken, low-wage, slow-growth economies, many homeowners have discovered not only that they bought into a Ponzi scheme, but that the local economy cannot provide the sorts of job opportunities that might help them rebuild lost wealth.

In his 2008
Atlantic
essay, “The Next Slum?” the real-estate developer and land-use strategist
Christopher Leinberger argued that even in less frenzied markets, traditional suburbs (and in particular newer exurban communities far from city centers) were headed for a long decline—that today’s McMansions might turn into tomorrow’s tenements. The suburbs had been massively overbuilt throughout the
aughts, Leinberger observed. Meanwhile, inexorable demographic changes (an aging population, fewer and smaller families), rising gas and energy prices, and a tectonic shift in cultural preferences toward urban living all suggested decades of declining demand for oversized houses on the suburban fringe. In 2006, the Virginia Tech housing expert Arthur C. Nelson concluded, after a detailed analysis of housing supply, population growth, and recent consumer research, that by 2025, there would likely be a surplus of some 22 million large-lot homes nationwide, or roughly 40 percent of all large-lot homes then in existence.

It’s worth noting the
difficult compromises that many middle-class families have made in recent years in their effort to own a piece of the American Dream. Nearly one in four people surveyed by Fannie Mae in 2010 said they were “sacrificing a great deal” to own a home. Even in 2000,
roughly 3.5 million Americans were making “extreme commutes” (defined as daily, round-trip travel of three hours or more), and that number had doubled since 1990. Roughly one in eight workers was leaving for work by six o’clock each morning. Whatever it may mean for romantic notions of the human spirit, over the years economists have consistently found that a short commute is one of the more important keys to happiness; few things affect general life satisfaction more than commuting time.
Related research shows that people who commute through heavy traffic typically accumulate higher concentrations of stress hormones in their blood, get sick more often, and fight more with office mates at work and with family members at home. Perhaps these compromises were worth making to build equity for the future or provide a better environment for the children. But in many places that equity is now gone and the environment is changing.

Once suburban communities begin to falter, Leinberger wrote, they can tip quickly into irreversible decline. Typically, municipal revenues on the suburban fringe are heavily dependent on property taxes and fees associated with new construction; a smaller tax base means fewer and poorer municipal services, including policing and
schools. Widespread vacancies inevitably lead to the eventual conversion of houses into rental units—and not just of the single-family sort. And because most modern houses, even McMansions, are built so cheaply today in comparison to the houses and brownstones of decades past, they are ill-suited to rental, because they show wear quickly.

A 2010 Brookings Institution study, “The State of Metropolitan America,” found that in a historic reversal, more poor people have recently come to reside in America’s suburbs than in its cities. And the number is climbing rapidly; over the past decade, the suburban population living below the poverty line grew by 25 percent, nearly five times faster than the urban poor population in America’s largest metro areas. In the exurbs, just 19 percent of adults had a college degree in 2008, well below the national average. And in places like Memphis and Charlotte,
crime, too, has migrated to the suburbs, while in some cases declining in the central city.

In the 1960s and ’70s, for the most part, those urban residents who could leave American cities did, and urban decline became self-reinforcing for more than a decade. Today, that same general phenomenon—or rather, its mirror image—may be under way, as those who have the wherewithal leave the exurbs for smaller houses or rental units in closer suburbs or resurgent cities. But the transition of places from middle-class to poor, from populous to vacant, is inevitably messy and contentious. Inner cities took the better part of two decades to empty of the middle class. Astonishingly, as of 2009,
Detroit remained America’s eleventh-largest city, despite a decline spanning generations and an average home price that fell below $20,000 during the recession.

Today, after years of rapid growth, Las Vegas is now shrinking. In 2005,
as Sin City beckoned, U-Haul charged people renting a truck from Los Angeles to Las Vegas almost four times what it charged those going in the opposite direction. In 2010, demand had reversed, and so had U-Haul’s prices.
That’s no surprise: Nevada led the nation in both unemployment and foreclosures as of September
2010, and Las Vegas, noted the
New York Times
, was facing “its deepest slide since the 1940s.”
What’s surprising is that the outflow hasn’t been faster. “We’re in such bad shape here you’d think a lot more people would be leaving,” said John Restrepo, a Nevada economic-development analyst, to the
Las Vegas Sun
in September 2010. “And maybe they would if they could, but they’re kind of stuck.”

Most people cannot easily uproot themselves from their community, even if they’d rather live elsewhere. Jobs, schools, and family commitments tug at some. Years of savings poured into down payments, mortgage payments, and renovations make others reluctant to cut their losses. Scant savings make it difficult to relocate, and impossible to do so without significant downsizing.
Anchored by houses they couldn’t afford to sell, more Americans stayed put in 2008, the first year of the recession, than in any year since the Census Bureau began tracking moves in 1948. In 2009, the rate of migration rose minimally—in large part because foreclosures began to force more people to move—but was still historically low.

And so, for the foreseeable future, it looks likely that millions of American families who had imagined themselves to be economically successful and upwardly mobile will be both metaphorically and physically stuck, rooted in places that are changing in ways they did not anticipate and do not welcome. How they react to that circumstance will, to a large degree, shape the contours of American community life for the next several years or more.

I
N THE NATIONAL
imagination, hard times bring communities together. Neighbors exchange favors, watch out for one another, even cover each other’s debts in times of need. And
surely this recession has produced untold acts of kindness and generosity; according to one recent Pew survey, for instance, about half of all Americans have lent money to a friend or family member since the downturn began, and roughly a quarter say they’ve been a recipient of such a loan.

But as many social critics have noted,
the suburbs were never
really designed for togetherness. As Kenneth T. Jackson writes in his classic history of suburbia,
Crabgrass Frontier
, the initial mid-twentieth-century push into the suburbs was driven by cheap housing, yes, but also by the desire to get away from a more crowded and public way of life—and all too often by racial prejudice. The advent of air-conditioning heralded the abandonment of front porches, the closing of windows, and a further retreat into private lives behind private walls. Indeed, the growth of the suburbs—and with it the privatization of most aspects of daily living—is sometimes given as one reason why Americans became more politically conservative in the latter half of the twentieth century.

I asked Mark Spector if the recession and all its attendant problems had brought Bridgewater’s residents any closer together. “It’s the exact opposite,” he replied. As in many recently built subdivisions, the community didn’t have a deep reservoir of local spirit or goodwill to begin with. The homeowners-association meetings, Spector said, have “never had a quorum.… Even with all the trials and tribulations, the largest number of people we’ve ever had—even with proxies—was something like sixty-five. And we need 152.” But whatever shallow reservoir once existed now seems utterly depleted by the stresses of community decline—and by the strenuousness of the efforts to reverse it.

Against the backdrop of Florida’s epic housing crash, and among subdivisions built near the height of the bubble, Bridgewater is actually something of a success story for its ability to arrest its decline. If you want to see what failure looks like, head south to Carriage Pointe in Gibsonton, where the ubiquitous and exotic real-estate signage
—FOR SALE, SHORT SALE, NEIGHBORHOOD STABILIZATION PROGRAM SALE
—is frequently obscured by thigh-high weeds; where the detritus of foreclosure and eviction (old couches, broken TVs, cardboard boxes) sits forlornly in driveways and on curbs; and where some of the people who still live among the vacant shells around them will not open their door in the daytime to a fortyish man who says he’s a reporter. In Bridgewater, by contrast, the lawns are now
neatly trimmed, the yards are once again tidy, and neighborhood crime has decreased from its post-crash highs.

But this order has come at a price. Lacking any organic means of bringing the community together and pulling it back up from its descent, Spector and the other association officers have turned instead to the cudgel available to homeowners associations nationwide, and they have wielded it ruthlessly: hypervigilant rules enforcement—backed by heavy, quick-trigger fines and liens—has become a dominant feature of community life.

To one extent or another, lawyerly yard challenges have always been characteristic of America’s planned communities, where one can find occasional acts of exquisite pettiness in even the best of times. And Bridgewater’s approach has worked cosmetically, allowing the community to find new home buyers and limit vacancies. But to achieve that goal, the association has levied thousands of dollars in fines on some households. When a lawn isn’t kept to code, for instance, the association will issue a warning, and if the violation isn’t quickly cured, it will simply put the house on a list of properties for which the association will do lawn care whenever the lawn is in violation, without notice, billed punitively at $100 a cut. The same is true, more or less, for mulching, edging, tree trimming, and exterior house upkeep. Cars parked on the street are quickly towed. Off-duty policemen are paid by the association to patrol the community and keep it safe; they sometimes confront and question people they believe are acting suspiciously.

These tactics have not always gone over well in a community that is already struggling. Some residents told me they believe the association has been especially aggressive toward undesirable renters, burying them or their landlords in fines for small transgressions until they leave. Neighborly relations, meanwhile, have turned hostile, as some families have come to suspect that others do not welcome their presence and are constantly on the watch for minor violations to report. One mixed-race couple who in 2008 bought a foreclosed three-bedroom house—their first—told me that trust within the
community is almost completely absent. The neighborhood is more black than it used to be, said the husband, an African American, and some residents didn’t seem to like that. He didn’t believe the association was targeting blacks—“it has more to do with class than race.” But tensions had risen between renters and owners, blacks and whites, higher-income owners who’d initially bought into the neighborhood and lower-income owners who’d bought in more recently.

I asked him whether crime in the neighborhood was ever a problem, and he gave a little laugh. “Maybe it’s where I grew up,” he said, but since he’d moved in, he’d never felt unsafe or been worried about burglars. What had worn on him instead was the vibe he sensed from a few of his neighbors—and the way he thought some of the community’s struggling families were being treated. “It’s not the community we thought we were moving into,” he said, echoing Spector’s words precisely, though for different reasons.

Like Spector, the husband and wife, who asked not to be identified, were now well underwater on their house, though they’d thought they were buying it cheaply. They felt they had no choice but to stay put. But “I don’t feel like it’s a neighborhood, a community,” the wife told me. “It just doesn’t feel like a community I should be raising my kids in. I don’t really talk to the neighbors much anymore. If we could move, we’d move today.”

In his 2008 book,
The Big Sort
, Bill Bishop presented compelling evidence that since about 1980, America’s suburbs have become ever more finely segregated—by income, political beliefs, education, and general sensibility. Most, today, are finely attuned to social class. When these delicate ecosystems change suddenly, the results can be jarring for all their residents, new and old, and the reactions are not always graceful.

“People move into neighborhoods because they want to be among their peers,” Spector told me. As we talked, it became clear that he resents some of his neighbors, and it isn’t so hard to understand why. They are constant reminders that he has stopped moving forward and has instead fallen back—physical embodiments of his disillusionment
with the American Dream. “I’ve done everything right,” he said. “I didn’t buy a bigger house than I could afford.… We have owners here who haven’t made a bank payment in four years now; that’s what I see on a day-to-day basis. And that makes me scratch my head and think,
What the hell am I doing wrong?
I did everything the way I was taught, everything the way I grew up believing was correct. But at the same time I see all these deadbeats—well, I used to call them deadbeats, now I call them brilliant people, because they’re walking away scot-free, not paying any penalty, even getting the difference in a short sale.”