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    Best of 2011: Sick suburbs, expiring exurbs

    Regions such as Snohomish County that fell hard for developers' dreams of remote housing projects are paying a severe price in foreclosures and short sales. The cruel market correction confirms the economic value of denser, closer-in residential patterns.

    Suburban tract housing outside Cincinnati, near Union, Kentucky

    Suburban tract housing outside Cincinnati, near Union, Kentucky Derek Jensen/Wikimedia Commons

    Editor's Note: In the run-up to the new year, Crosscut is sharing ten days of its best stories from 2011, each with a different theme. Today we are looking at some of our coverage of the Puget Sound region's changing suburbs. This story first appeared in August.

    Flash back to 2006. The economy was booming, the stock market soaring to unprecedented heights.  Here in Puget Sound, more than 20 high rises containing thousands of dwellings were proposed on almost every vacant or under-used lot in downtown Seattle. Carpetbaggers from California to New York and Las Vegas were trotting out overblown tower schemes obviously imported from elsewhere.

    Up in Snohomish County, a far more insidious and damaging series of events was unfolding. Dozens of developers — from bonafide to bottom-feeders — were beating down the doors of the county administration building to demand more and faster permits to clear the landscape and build single family houses. It was a home buying mania.

    Real estate agent Kyoko Matsumoto Wright recalls those heady days. "We often had multiple offers on anything that was remotely livable. While most people knew what they could afford, clearly some would look at houses much more expensive. But their banks would give them the OK to buy the most expensive one.”

    Nothing the matter with building and selling, buying and moving into one’s dream, right? Trouble is, as we now know, millions of Americans had no business trying to buy a house. For many households, it was little more than an illusion, fueled by irresponsibly loose lending practices and an attitude that “investing” in real estate was a sure bet — with increases in value forever.

    “During the housing bubble, Snohomish County allowed a large number of rural subdivisions,” said Tim Trohimovich Co-Director of Planning & Law for Futurewise. “These subdivisions had high costs for the families that bought the lots, the nearby farms and forests, and the environment. It is unfortunate, but not surprising, that these high costs have led to a high level of foreclosures,” he said.

    The eager builders managed to persuade Snohomish County to adopt laws that allowed wholesale removal of trees, clearing of land, and rapid approvals. Standard development practices that had been used to good effect in other Western Washington cities for years were rebuffed. Since then, county standards have been beefed up, but too late to head off the most recent wave of havoc on the landscape.

    One code was cleverly disguised to sound noble, but in fact drove a stake through growth management principles. Under the law, hundreds of “Rural Cluster Subdivisions” (an absurd oxymoron of land use terminology) were approved. They are still on plat maps, awaiting, one hopes, legal extinction. Thankfully, most were not built, and many of the proponents are now bankrupt and gone.

    There was some benefit to the Great Recession in that it cleaned house a bit. But the detritus of half-built projects, shoddy construction, and disconnected pockets of randomly-located microsuburbia carried with it a price. Snohomish County is now the reigning queen of short sales and foreclosures in the metropolitan area, by a good measure. Throughout the county, fully 38 percent of active housing transactions fall into these two categories, according to data from the Northwest Multiple Listing Service. Some areas are as high as 42 percent.

    The percentage for Pierce County is 32 percent; in King County, the number is 27 percent — nothing to be proud of, for sure. 

    Look closer and a very interesting pattern emerges. Many of the communities and neighborhoods closest in to the center of the Seattle metropolitan area — areas with significantly higher densities and older housing stock — actually performed reasonably well during the recession. Value was lost, certainly, and some loans are under water, but there is virtually none of the wildly oversold and overpriced housing found in the outer suburbs and exurbs. A similar pattern is found near other urban centers such as Bellevue and Kirkland.

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    Posted Tue, Dec 27, 6:16 a.m. Inappropriate

    Interesting idea, but the fact remains, few can afford to live in a large metropolitan city. My family lives in Maple Valley, where one can still afford housing, albeit barely, it is quieter, how can one truly relax with the constant din of a city in the background? It is a one-hour drive to work, and a 90-minute drive home everyday. I still would not want to live in Seattle. My parent’s home in Seattle became so noisy, that in the mid ‘60s we could not sleep with the windows open as the noise would keep us awake. I still like some green grass under my feet; I like the ability to root around in my own yard. How can one do that in a dense pack high rise in the city? The real reason for the lack of foreclosures is the stability of the neighborhoods. Not the location in which they exist, Nieces and nephews that live in Seattle and Bellevue are all in sorry shape with their houses, they all purchased them in the last ten years. Foreclosures are a function of no work, not location. I believe erroneous conclusions are being drawn from incomplete facts.

    Posted Tue, Dec 27, 11:19 a.m. Inappropriate

    seattlelifer, I certainly don't disagree with your freedom to make the choices you've made, but your arguments (while commonly repeated) are simply not true.

    First of all, "few people can afford to live in a large metropolitan city" is inherently untrue. What makes it a large metropolitan city? All the people; they can all afford to live there, or they wouldn't be there. In any case, part of what makes urban space more expensive is that the demand is higher, meaning that even more people *want* to live there than do.

    So while you may prefer grass under your feet (which most homeowners in Seattle have, btw) and find Seattle too noisy (I find it disturbingly quiet) this isn't about you or me. It's about demographics. The point is that the demand for housing in the US is increasingly for denser, smaller, and more urban (granted, that's against a very suburban baseline). It is, in fact, *all* about location.

    Part of that location piece is that affordability doesn't just include housing, but all the other costs of living in a certain location. My location allows me to live without a car, which more than pays for higher housing costs. Long daily commutes have been linked in multiple studies to higher blood pressure, increased stress, and decreased happiness. I never sit in traffic. So you have your preferences and I have mine (I would never live in Maple Valley), but - again - the point is the demographics, and whether our development policies are aligned with reality, or an ideal of American life that no longer exists.


    Posted Tue, Dec 27, 11:34 a.m. Inappropriate

    A couple of points about this piece.

    First, the lousy financing plan for Brightwater was based on lots of new SFD subdivisions going in up in Snohomish County. That was the bet – with county rate-payers’ money – that Sims and his finance gurus made. That didn’t pan out, so the Brightwater expenses are now being spread around King County instead of where they were supposed to land (on new homebuyers in Snohomish County).

    Second, this “morality tale” is meant to stroke and flatter new-urbanist devotees, but the data don’t support the hyperbole:

    But here’s the fascinating morality tale. Those counties and cities and towns that most heeded the tenets of growth management have fared the best in this worst of times. They are emerging with the strongest downtowns, the most stable housing, the best values, and the highest “quality of life” that everyone seems to seek as the holy grail.

    Read that and you might think housing and employment in Seattle are strong. Fact is, new data show a continuing decline in housing prices in virtually all urban areas, including Seattle:


    Seattle certainly has no strength in terms of jobs either. Downtown Seattle lost 4% of private sector jobs in the 2009 – 2010 period alone. Private sector employment figures over the past decade in downtown Seattle have dropped consistently; there was a 15 percent loss in jobs there. There has been a job loss of 9 percent city-wide, 4 percent for King County and 2 percent for the Puget Sound Region. The rate of job loss decreases the further out you go. Those figures come from here:



    Posted Wed, Dec 28, 11:27 a.m. Inappropriate

    The point of the article was not that everything is wonderful in downtown Seattle (one part of the metropolitan region), but that it has been less impacted by the crash than the outer edges and the in-the-making boomer new edge sprawl. Its the difference between a brick falling on your toe and a hangnail.

    And your reference gives these figures for all employment between 2009-10:
    Downtown Seattle -4%
    City of Seattle -2%
    King County -3%
    Region -3%

    So, the City of Seattle did, in fact, have a lower rate of job loss from 2009-10 than the County and the "Region." And while housing prices are continuing to decline in "virtually all urban areas, including Seattle," as the article points out short sales and foreclosures are not as prevalent as in the suburb edges, such as the orphaned speculation afflicting Snohomish County.

    Steve E.

    Posted Wed, Dec 28, 1:23 p.m. Inappropriate

    The most relevant fact here is likely the percentage of recent mortgages in the development. Although downtown Seattle may well have seen as many new units as parts of Snohomish County as a relative overall percentage it is much lower.

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