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Strategies & Market Trends : The Residential Real Estate Post-Crash Index-Moderated -- Ignore unavailable to you. Want to Upgrade?


To: John Vosilla who wrote (28547)7/11/2011 11:04:39 AM
From: Jim McMannis  Read Replies (1) | Respond to of 119362
 
The Costs of Smart Growth Revisited: A 40 Year Perspective

newgeography.com

"Soaring" land and house prices "certainly represent the biggest single failure" of smart growth, which has contributed to an increase in prices that is unprecedented in history. This finding could well have been from our new The Housing Crash and Smart Growth, but this observation was made by one of the world's leading urbanologists, Sir Peter Hall, in a classic work 40 years ago. Hall led an evaluation of the effects of the British Town and Country Planning Act of 1947 (The Containment of Urban England) between 1966 and 1971. The principal purpose of the Act had been urban containment, using the land rationing strategies of today's smart growth, such as urban growth boundaries and comprehensive plans that forbid development on large swaths of land that would otherwise be developable.

The Economics of Urban Containment (Smart Growth): The findings of Hall and his colleagues were echoed later by a Labour Government report in the mid-2000s which showed housing affordability had suffered under this planning regime. Author Kate Barker was a member of the Monetary Policy Committee of the Bank of England, which like America's Federal Reserve Board, is in charge of monetary policy. Among other things, the Barker Reports on housing and land use found that urban containment had driven the price of land with "planning permission" to many multiples (per acre) above that of comparable land where planning was prohibited. Under normal circumstances comparable land would have similar value.

Whether coming from the left or right, economists have demonstrated that prices tend to rise when supply is restricted, all things being equal. Certainly there can be no other reason for the price differentials virtually across the street that occur in smart growth areas. Dr. Arthur Grimes, Chairman of the Board of New Zealand's central bank (the Reserve Bank of New Zealand), found the differential on either side of Auckland's urban growth boundary at 10 times, while we found an 11 times difference in Portland across the urban growth boundary.

House Prices in America: The Historical Norm: Since World War II, median house prices in US metropolitan areas have generally been between 2.0 and 3.0 times median household incomes (a measure called the Median Multiple). This included California until 1970 (Figure 1). After that, housing became unaffordable in California, averaging nearly 1.5 times that of the rest of the nation during the 1980s and 1990s (adjusted for incomes). Even after the huge price declines from the peak of the bubble, house prices remain artificially high in Los Angeles, San Francisco, San Diego and San Jose, with median multiples of six or higher.

William Fischel of Dartmouth University examined a variety of justifications for the disproportionate rise of California housing prices and dismissed all but more restrictive land use regulation. He noted that "growth controls (restrictive land use regulations) have the undesirable effect of raising housing prices." Throughout the rest of the nation, more restrictive land use regulations have been present in every market where house prices rose substantially above the historic Median Multiple norm, even during the housing bubble. No market without smart growth has ever reached these heights.

Setting Up for the Fall: Excessive Cost Increases in Smart Growth Markets: The Housing Crash and Smart Growth, published by the National Center for Policy Analysis, examined the causes of house price increase during the housing bubble. The analysis included all metropolitan areas with more than 1,000,000 population. It focused on 11 metropolitan areas in which the greatest cost increases occurred (the "ground zero" markets), comparing them to cost increases in the 22 metropolitan areas with less restrictive land use regulation (Note 1).

•Less Restrictively Regulated Markets: In the less restrictively regulated markets, the value of the housing stock rose approximately $560 billion, or 28 percent from 2000 to the peak of the bubble (Note 2). In nearly all of these markets, the Median Multiple remained within the historical range of 2.0 to 3.0 and none approached the high Median Multiples that occurred in the "ground zero" markets.
•Ground Zero Markets The value of the housing stock rose $2.9 trillion from 2000 to the peak of the bubble in the "ground zero" markets, all of which have significant land use restrictions (Note 3). The 112 percent increase in the "ground zero" markets was four times that of the less restrictively regulated markets. The Median Multiple rose to unprecedented levels in each of the "ground zero" markets, peaking at from 5.0 to more than 11.0, four times the historic norm.

The 28 percent increase in relative house value that occurred in the less restrictively regulated markets (those without smart growth) is attributed to the influence of loosened lending standards. The excess above 28 percent, which amounts to $2.2 in the "ground zero" markets is attributed to to the supply restricting strategies of smart growth (Figure 2).

The Fall: Smart Growth Losses

The largest house price drops occurred in the markets that had experienced the greatest cost escalation, both because prices were artificially higher but also because prices in smart growth markets are more volatile. The "ground zero" markets, with only 28 percent of the owner occupied housing stock, accounted for 73 percent of the pre-crash losses ($1.8 trillion). Thus, much of the cause of the housing crash, which most analysts date from the Lehman Brothers bankruptcy (September 15, 2008), can be attributed to these 11 metropolitan areas.

By contrast, the 22 less restrictively regulated markets accounted for only six percent ($0.16 trillion) of the pre-crash losses. These 22 markets represented 35 percent of the owned housing stock (Figure 3).



To: John Vosilla who wrote (28547)7/11/2011 1:04:58 PM
From: Broken_Clock1 Recommendation  Respond to of 119362
 
hard to tell the players without a program...is this a republican or a democrat?

SATURDAY, JUL 9, 2011 12:10 ET
The great generational threat
BY GLENN GREENWALD
In just the past two months alone (all subsequent to the killing of Osama bin Laden), the U.S. Government has taken the following steps in the name of battling the Terrorist menace: extended the Patriot Act by four years without a single reform; begun a new CIA drone attack campaign in Yemen; launched drone attacks in Somalia; slaughtered more civilians in Pakistan; attempted to assassinate U.S. citizen Anwar Awlaki far from any battlefield and without a whiff of due process; invoked secrecy doctrines to conceal legal memos setting forth its views of its own domestic warrantless surveillance powers; announced a "withdrawal"plan for Afghanistan that entails double the number of troops in that country as were there when Obama was inaugurated; and invoked a very expansive view of its detention powers under the 2001 AUMF by detaining an alleged member of al-Shabab on a floating prison, without charges, Miranda warnings, or access to a lawyer. That's all independent of a whole slew of drastically expanded surveillance powers seized over the past two years in the name of the same threat.

Behold the mammoth, life-altering, nation-threatening danger justifying this endless -- and ongoing -- erosion of safeguards, checks and liberties, from The Los Angeles Times (h/t Antony Loewenstein):

Defense Secretary Leon Panetta declared Saturday that the United States is "within reach" of "strategically defeating" Al Qaeda as a terrorist threat, but that doing so would require killing or capturing the group's 10 to 20 remaining leaders.

Heading to Afghanistan for the first time since taking office earlier this month, Panetta said that intelligence uncovered in the raid that killed Osama bin Laden in May showed that 10 years of U.S. operations against Al Qaeda had left it with fewer than two dozen key operatives, most of whom are in Pakistan, Yemen, Somalia, and North Africa.

In one sense, it's commendable that Panetta is acknowledging this, though he's doing so to protect the President from political attacks in the wake of his announced withdrawal of 30,000 troops from Afghanistan. But in another, more important sense, Panetta knows that this disclosure won't even slightly impede the always-expanding National Security State and the War on Terror which justifies it -- just like the acknowledgment long ago that there were fewer than 100 Al Qaeda operatives in all of Afghanistan had no effect on our decade-long war there. That's because -- as the above-described events of the last eight weeks demonstrate -- civil liberties assaults and expansions of executive power are not what the U.S. Government does in response to some actual problem; it's what the public-private consortium composing the U.S. Government is. Terrorist villains are the pretext for, not the cause of, those policies, and they will continue irrespective of the scope or magnitude of Terrorism.

Indeed, even as he described the puny, broken, absurd state of Al Qaeda -- one that has, at most, produced a grand total of one attack on U.S. soil in the last decade and a handful of amateurish, low-level attempts thwarted by regular police powers, and kills fewer Americans each year than intestinal ailments -- Panetta claimed "that it would take "more work'"; that "now is the moment following the death of Bin Laden to put maximum pressure"; that "it was from Yemen -- not Pakistan -- that the U.S. faces the most potent threat of future terrorist attacks, from an Al Qaeda offshoot known as Al Qaeda in the Arabian Peninsula, where "the group has gained strength in recent months as unrest has swept through Sana, the capital, and large swaths of its rugged hinterlands, where militants are growing in strength"; and that we have to kill all the remaining operatives. In other words, he offered multiple reasons why the War on Terror and the civil liberties abuses justified in its name must not only continue but be escalated.

Of course, just in case those propagandistic claims aren't sufficient -- we must wage war in multiple countries and seize ever-expanding surveillance powers to stop this group of two dozen Terrorist masterminds -- the U.S. is doing everything possible to ensure that Terrorism remains as large as a threat as possible:

A NATO air strike has killed at least 14 civilians, including eight children, in the eastern Afghan province of Khost, local police say. . . .The deadly air raid came a day after two children were reportedly killed in a separate air strike in southwest Ghazni province.

The killing of civilians by foreign troops is a major source of friction between Afghan President Hamid Karzai and his Western backers, and has soured the feelings of many ordinary Afghans towards foreign forces. . . . As violence has spread across the country, casualties have risen, and the United Nations said May was the deadliest month for civilians since they began keeping records four years earlier.

I long believed that the most patently irrational American policy -- the one that would cause future generations to look back in baffled disgust -- was the Drug War: imprisoning huge numbers of citizens for years and years for nothing more than possessing or selling banned substances to consenting adults. But now I think it's this: that the U.S. Government is able to persuade the populace to continue to support and pay for blood-spilling and liberty-destroying policies in the name of Terrorism when nothing sustains and exacerbates the threat of Terrorism more than those very policies. Just like the FBI continues to manufacture its own Terrorist plots that it then flamboyantly boasts of thwarting, the U.S. continues to generate the threat that justifies its National Security and Surveillance State.

* * * * *

In the last week alone, U.S.-allied governments have done the following to their own citizens: killed "dozens of civilians" in Yemen; beaten anti-government protesters in Baghdad while the Iraqi Prime Minister threatened "bloodshed" and "blood to the knees" if protests continued; attacked protesters in Cairo with arms; and beat opposition protesters in prison and branded them "traitors" in Bahrain. As we recently learned, the U.S. cannot and will not "stand idly by when a tyrant tells his people there will be no mercy." What, then, can and should the U.S. do in the face of this oppression? Don't we have more of a responsibility to act when such brutality is carried out by regimes that we arm, support and prop up than by ones we don't?



To: John Vosilla who wrote (28547)7/11/2011 1:14:09 PM
From: Broken_Clock2 Recommendations  Read Replies (1) | Respond to of 119362
 
As compared to the "crises" we face today?

You get your daily prescribed dose of fear this morning?