TBO.com - TBO is Tampa Bay Online

Recession Brings Clouds, Not An Economic Sunset

ADVERTISEMENT

The Tampa Tribune

Published: February 15, 2009

The deserted houses and heartbroken homeowners in Florida's newest suburbs are the subject of a devastating article in the current New Yorker magazine. The selected snapshots show bleaker scenes in Hillsborough and Pasco counties than most of us who live here will recognize.

Yet there is no question Florida's addiction to fast growth contributed to the state's sudden reversal of fortunes.

The New Yorker calls us the Ponzi state, and the insult is correct in that the housing boom fed on itself and could not be sustained. The last ones in were hurt the most. For years, local leaders, heavily influenced by developers, did too little to create a diverse and sustainable economy.

As housing prices shot up, Florida leaders did, belatedly, focus on the new, painful symptoms of growth, such as high property taxes and homes becoming unaffordable to young families who were left behind by the rising real-estate bubble. State officials also tightened growth rules and here in Hillsborough, elected officials upheld the urban-service boundary and raised impact fees on newly built homes.

Now that the homebuilding industry has collapsed, political pressure is increasing at the state and local level to undo many of the smart decisions made in recent years to protect taxpayers from the high costs of runaway growth. Relaxing the rules would be little or no help to homebuilders now, but it would be a costly mistake for everyone else when growth does return.

Taxpayers should not be required to subsidize helter-skelter construction.

The housing boom here, in Arizona, and many other places was fed by lax lending practices. Old homes as well as new ones were affected, so it's a stretch to say, as the New Yorker implies, that the overbuilding of Florida incubated the nation's foreclosure epidemic.

Bankers and brokers took reckless risks with investors' money to put people into houses they could afford only if values kept going up. The people lending the money should have known better. As a result, lots of people have lost their savings and the financial markets had to be bailed out with taxpayers' money.

It's a mess not yet cleaned up, but it's not the end of the world and not the end of Florida as a great place to live.

The New Yorker article put a few troubled subdivisions under the journalistic microscope to discover people who were financially defeated, frightened, and mistrustful of each other. It reported vacant lots turning into dumping grounds, overgrown lawns, and new houses abandoned and boarded-up.

What people living there need is hope, not more opportunities for housing upgrades.

Drive through most subdivisions and you'll see things much as they were five years ago, except you will notice plenty of good, second-hand houses for sale at heavily discounted prices and no impact fees.

Lowering fees on new homes will make it even harder to reduce this big inventory on the market. With sales finally beginning to pick up but values still flat, homeowners should be furious that anyone is even considering subsidizing the building of more new homes.

The major obstacle for homebuilders is not fees. Employment is no longer growing and luring workers here from other states. Good jobs are hard to find anywhere near the neighborhoods hardest hit by last year's spike in fuel prices and the continuing foreclosures.

Behind Florida's rising unemployment rate are many stories of personal despair and imminent business ruin.

The most sensible response from government is to speed up easy, necessary public projects postponed in recent years, such as resurfacing roads, upgrading drainage, and retrofitting public buildings to increase energy efficiency.

This work can begin immediately to put people to work, help the construction industry and bring instant returns to taxpayers.

The Miami Herald correctly terms the foreclosure blight an "unnatural disaster." Bad investments caused it, and good investments can help end it.

Florida should continue to market itself to high-wage employers and to upscale retirees. It should continue to distance itself from what the New Yorker calls a Wild West mentality of anything goes that, ultimately, brought disaster.

Share this:

Loading Comments...

Email Print

ADVERTISEMENT