How Not to 'Save' a City

 

by Richard Florida

 

 

The idea that cities can shrink to survive is all the rage in urban planning circles today. The notion is that older cities can become better, more self-sufficient places by making do with less and bringing their level of infrastructure and housing into line with their smaller populations. But this idea may do more harm than good. From the urban renewal programs of the 1950s and 1960s to the “planned shrinkage” and “benign neglect” efforts of the 1970s, initiatives to clear urban neighborhoods, assemble and reclaim land, and relocate people in the name of revitalization have been a disaster.

 

- “Now comes the ‘theory’ that the salvation of distressed cities is to once again 'shrink,' as if shrinking had been tried before and succeeded somewhere but who knows where," writes the urbanist Roberta Brandes Gratz. "Can anyone point to one city, just one, where any of these ‘renewal’ schemes have worked to regenerate, rather than further erode, a city? Just one." Needless to say, there aren’t any. The record of schemes to revive cities by assembling and remaking neighborhoods is littered with disastrous unintended consequences. People thrown of out their homes, neighborhoods destroyed, historic structures leveled, and the community fabric of too many once great cities ripped to shreds.

 

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods don’t come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

- Many of today’s great urban neighborhoods from New York’s Greenwich Village to Boston’s North End to Columbus’s German Village were those where residents successfully blocked top-down renewal schemes. Instead of handing over neighborhoods or even whole sections of cities to city hall or private developers, we’d be much better off enabling residents to take control of and build on community assets, engaging them in community-based organizations that can spearhead revitalization and build real quality of place.

 

- In the wake of the 9-11 attack on Lower Manhattan’s Financial District, I asked Jacobs how she would rebuild the area. “You’re asking the wrong question,” she replied. “It’s not what I would do or anyone else would do for that matter,” she told me. “The key is to engage the residents of the area, the business owners, the shopkeepers, the workers and the commuters. They’re the ones that can show the way to rebuild.”

 

Full article below:

http://www.nytimes.com/roomfordebate/2011/03/28/the-incredible-shrinking-city/how-not-to-save-neighborhoods

^Have to disagree with you.  What's to stay that in fifty years (not that long a period of time) the trend reverses (again) and we are scrabbling to build infrastructure in cities long neglected because we thought it was the end of the empire.

^Though wasteful, it might be less expensive to build new infrastructure if/when it's needed, than to maintain existing, unused infrastructure for 50 years.

That piece is just one entry in a whole string of moronic things the Times has ran recently about urban development.  I guess you can't ask for much in that format when you're only allowed a few hundred words, but a pretty silly submission none the less.

 

Another piece, which just made me angry it was so stupid was this: http://opinionator.blogs.nytimes.com/2011/03/27/the-future-of-manufacturing-is-local/?hp

 

Yeah Detroit, you just need to open a microbrewery like SF.  JFC please stick with pure lifestyle pieces.  Or rather, don't dress them up to be something harder hitting than they are.

 

 

What's moronic about it?  I don't know that Florida is necessarily right, but I agree with him that the history of "planned shrinkage" is not exactly promising.

^Though wasteful, it might be less expensive to build new infrastructure if/when it's needed, than to maintain existing, unused infrastructure for 50 years.

 

I'd agree with this. Most of the infrastructure in those areas is probably shot already, and anyway is probably close to the end of its lifecycle. A decade or two of cleansing might encourage the regeneration of these brown-->greenfields, rather than maintaining buildings and infrastructure that were built as hastily and speculatively as some of the cardboard mansions of exurbia. Look at Chicago, which has over time replaced much of its anno-1900 infrastructure with what is, for all intents and purposes, a new city. Urban areas need consistent regeneration, and when there is no or exceedingly poor-quality investment for five or six decades, it might just be better to start over. Most of Detroit, much of East Cleveland, and just about all of Gary are a testament to this. But, there is no magic potion to jump start development once this is cleared. Fall Creek Place in Indianapolis might be a good model for the step-by-step redevelopment that saves neighborhoods and cities.

What's moronic about it?  I don't know that Florida is necessarily right, but I agree with him that the history of "planned shrinkage" is not exactly promising.

 

I think he's being either disingenuous or lazy when he compares today's planned shrinkage discussions to urban renewal or the 1970s Bronx.  His title alone puts up a bit of a straw man, IMHO.  While I'm on board with some healthy skepticism about the viability or fairness of planned shrinkage in its boldest forms, most of his piece is just a dumb non-sequitur considering the question presented to him.  If planned shrinkage is on anyone's table today, it means we're not talking about the North End, OTR or even Buckeye Road, but this:

 

http://maps.google.com/?ie=UTF8&ll=42.335763,-83.08019&spn=0.005123,0.013078&t=h&z=17

 

Yeah, we should take Jane Jacobs' advice and talk to the shopkeepers.  Great.  Thanks Mr. Florida.  At least he didn't say the answer was more boutique manufacturing.

 

 

 

I get the sense that Florida might be good at helping a city build an arty-fartsy tourist districts - Pittsburgh and Toronto have a few of those - but that prescription is a farce for metro areas like Youngstown, Gary, Flint or the City of Detroit. I don't if he's a quack for suggesting as much, or if people are so desperate for a cure that they take his modest prescriptions as Holy Grail. Probably the latter.

^Judging from the comments to that piece, I don't know how many people familiar with these cities are really taking his prescription seriously for the types of neighborhoods that would be considered for planned shrinkage.    And probably worth pointing out that planned shrinkage and "enabling residents to take control of and build on community assets, engaging them in community-based organizations that can spearhead revitalization and build real quality of place" (Florida's "puppies and orphans" recommendation) aren't really mutually exclusive for a city as a whole.

Richard Florida is a pop-star urbanist. His craft is to shovel poo digestible by the masses, while those with something substantive to say go largely ignored.

 

I don't have research backing it up, but my suspicion is that he is solely responsible for the "Pittsburgh is coming back" meme, which is somewhat self-fulfilling (but not enough to stave off a census bashing). He's turned the city from a Forbes-list Cleveland to a Forbes-list Portland.

 

Don't get me wrong: I'm not dissing Pburgh, I'm just talking about popular perception.

What's moronic about it?  I don't know that Florida is necessarily right, but I agree with him that the history of "planned shrinkage" is not exactly promising.

 

I think he's being either disingenuous or lazy when he compares today's planned shrinkage discussions to urban renewal or the 1970s Bronx.  His title alone puts up a bit of a straw man, IMHO.  While I'm on board with some healthy skepticism about the viability or fairness of planned shrinkage in its boldest forms, most of his piece is just a dumb non-sequitur considering the question presented to him.  If planned shrinkage is on anyone's table today, it means we're not talking about the North End, OTR or even Buckeye Road, but this:

 

http://maps.google.com/?ie=UTF8&ll=42.335763,-83.08019&spn=0.005123,0.013078&t=h&z=17

 

Yeah, we should take Jane Jacobs' advice and talk to the shopkeepers.  Great.  Thanks Mr. Florida.  At least he didn't say the answer was more boutique manufacturing.

 

 

I'm not so confident in the purveyors of planned shrinkage.  I think, much like Florida's creative class, they've got a solution that they want to throw at a much wider range of neighborhoods than it's truly applicable to.  There are very few neighborhoods like the ones you are pointing to outside of Detroit and a couple of other small cities, but it's being painted as a panacea for nearly all cities with a declining population.  There are also a lot of unanswered questions- how much will planned shrinkage cost?  Can we/how do we configure the land so that it actually saves a substantial amount of money when it's fallow?  What of those who don't want to leave?

 

There may not be a figure analogous to Florida in that movement, but it's every bit as much pop-urbanism, to use borrow natininja's mode of terminology, as The Creative Class.

Just a quick point but there is a world of differenece between a city that has a stable metro area population (CLE and Cincy) and most of the flight is to the burbs and sprawl versus oversized Mill towns such as, Youngstown and Flint. Hell Y-town had whole neighborhood infrastructure on the East side that never even was built out during the boom years.

I enjoy reading Florida simply because he has thought provoking ideas on planning issues which have made their way into mainstream media, when few other established planners have.

 

On the topic of shrinking cities though, I think you have to approach it on a case by case basis, neighborhood by neighborhood, city by city.  Some things are worth saving, some are not.  Some things that work in Flint, MI do not work elsewhere.  Comparing approaches today to what was done 50 years ago is not the same - not the same intention & not the same results.  So a blank approach like "telling cities to stop shrinking" is something I disagree with.  I am actually a big fan of what Cleveland is doing with the Cuyahoga Land Bank - buying & acquiring properties for consolidation & redeveloped when the time comes.

I'm torn on the idea of whether cities should shrink or not shrink. I can tell you that some infrastructure lost is VERY difficult to get back. I am familiar with railroads and I know how difficult and expensive it is to restore it. In some cases, it costs less to do basic maintenance each year while the rail corridor is mothballed than it is to rebuild it in the future. The problem is you never when or if it will be needed again.

 

I'm sure rail isn't the only infrastructure that's difficult to restore as a city recovers. But I also know its tough to retain or attract residents and businesses when you have to tax them more to sustain the infrastructure that was intended to support a larger population. And that's why I have mixed feelings on the "Shrinking City" concept.

 

As for the Creative Class, I love visiting cities where they are in great abundance. But I love cities where they aren't. Not all residents are creative or if they are, they just don't have the same interests as those that Florida talks about in the Creative Class. Many have simple needs and don't need 500 types of coffee at the corner cafe, or art galleries on every other street corner, or organic food grocery stores. They just want a job where they can get dirt under their fingernails, tell stories, and show their  work-worn hands with pride to decades-old friends at the local shot-and-beer joint, and go home to their family every night to talk about their day and to help their kids with their homework. Most Rust Belt cities have large areas and populations where the people have such similar, simple needs as these. They don't care for all that funky Creative Class stuff that Florida writes about.

"Most Rust Belt cities have large areas and populations where the people have such similar, simple needs as these. They don't care for all that funky Creative Class stuff that Florida writes about"

 

True, but what Florida really writes about, is ATTRACTING the CREATIVE CLASS, as drivers of the new knowledge based economy.  These people do care about 50 different kinds of coffee shops, etc.

I'm not so confident in the purveyors of planned shrinkage.  I think, much like Florida's creative class, they've got a solution that they want to throw at a much wider range of neighborhoods than it's truly applicable to.  There are very few neighborhoods like the ones you are pointing to outside of Detroit and a couple of other small cities, but it's being painted as a panacea for nearly all cities with a declining population.  There are also a lot of unanswered questions- how much will planned shrinkage cost?  Can we/how do we configure the land so that it actually saves a substantial amount of money when it's fallow?  What of those who don't want to leave?

 

There may not be a figure analogous to Florida in that movement, but it's every bit as much pop-urbanism, to use borrow natininja's mode of terminology, as The Creative Class.

 

Sure, all that is the reasonable critique of the "clear and decommission" model of shrinking cities (and of the hype surrounding it).  And had Florida not specifically been asked about the very types of neighborhoods I was pointing to and had he replied with your thoughts, I wouldn't be here calling his post dumb.  But he didn't.  So I am.

 

For what it's worth, I would be much happier embracing the descriptor "managed shrinkage" for some of these things.  The shrinkage is real and exogenous to any local planning decisions.  The vacant buildings and empty lots are already there and there's nobody on the horizon to fill most of them back up.  Large swaths of land are already sitting fallow for decades.  The infrastructure consolidation is already occurring with safety services and schools. 

Just for the record, there was a great deal of neighborhood involvement in the creation of the Youngstown 2010 plan, and the individual neighborhood plans. (of the few neighborhood plans that have been completed...)

I think there are many cities, particularly in the rust belt, that must shrink first in order to grow.  I also think that people pay too much attention to raw population numbers.

 

Cleveland, for instance, was built to be a type of city it will likely never be again.  That's not to say that it can't be better.  It just won't have neighborhood upon neighborhood of blue collar families.  The housing stock in so many neighborhoods reflects that long lost past and frustrates growth at present.

I know it sounds semantic, but there's a difference between shrinkage and planned shrinkage. The fact is that cities like Cleveland, Buffalo, Detroit, Essen, Porto, etc. ARE shrinking. They are shrinking whether you plan for that shrinkage or not. The question is really whether you serve neighborhoods that have already shrunk dramatically better by planning for growth or planning for shrinkage. I agree with forumers who are rightly pointing out that we're not talking about knocking down blocks of intact buildings like in mid-century urban renewal efforts. We're talking about knocking down the remaining three houses on blocks that once houses hundreds of people, with the end goal being creating something in its place that's either less infrastructure-intensive or that has community value for the larger neighborhood, city (parks, urban farms, etc.).

 

It's also a little oversimplistic to suggest a city that takes on a shrinking city methodology is just throwing in the towel from border to border. Rather, what we're seeing is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential.

 

What I feel most cautious about is where we draw the line. It seems pretty common sense to me that an area like the Forgotten Triangle would probably benefit immensely from planned shrinkage, while infill is clearly a more appropriate strategy for neighborhoods like Tremont or Ohio City. It's neighborhoods in the middle like upper St. Clair-Superior or Glenville that are my biggest concern, i.e. In neighborhoods where we see considerable out-migration and high vacancy rates, but where the streets still feel relatively intact, which strategy is more appropriate? These are the neighborhoods where I would be most concerned about seeing urban renewal-like consequences.

Most of Cleveland's inner city housing is shotguns and duplexes, which probably need to go.  The problem with "urban renewal" was the plan behind it... suburbanize everything, reduce density, put fortresses and parking lots and bare grass everywhere.  This thinking led them to remove a disproportionate amount of apartment stock and mixed use commercial buildings.  They weren't trying to renew the city, they were trying to erase the very concept of city life.  That doesn't have to be the result now.  That was just one (very bad) plan.  Glenville could be rebuilt more urban and more sustainable than it is now or ever was before.  But expecting all that housing stock to come back into style may be asking a bit much.  Timeless it isn't.

^Yeah, I don't think that's really true.  There was no one template for the type of redevelopment envisioned by Urban Renewal.  In Cleveland, the most prominent urban renewal project very much anticipated residential development at much higher density than existed in the city before and than what we have now:

 

 

EDIT: In fairness, I certainly agree that there was a lot of unnecessary government-planned demo of mf housing in central Cleveland, particularly around Cleveland State.  And pseudo-government planned, like in University Circle.

 

Great post 8Shades.

I know it sounds semantic, but there's a difference between shrinkage and planned shrinkage. The fact is that cities like Cleveland, Buffalo, Detroit, Essen, Porto, etc. ARE shrinking. They are shrinking whether you plan for that shrinkage or not. The question is really whether you serve neighborhoods that have already shrunk dramatically better by planning for growth or planning for shrinkage. I agree with forumers who are rightly pointing out that we're not talking about knocking down blocks of intact buildings like in mid-century urban renewal efforts. We're talking about knocking down the remaining three houses on blocks that once houses hundreds of people, with the end goal being creating something in its place that's either less infrastructure-intensive or that has community value for the larger neighborhood, city (parks, urban farms, etc.).

 

It's also a little oversimplistic to suggest a city that takes on a shrinking city methodology is just throwing in the towel from border to border. Rather, what we're seeing is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential.

 

What I feel most cautious about is where we draw the line. It seems pretty common sense to me that an area like the Forgotten Triangle would probably benefit immensely from planned shrinkage, while infill is clearly a more appropriate strategy for neighborhoods like Tremont or Ohio City. It's neighborhoods in the middle like upper St. Clair-Superior or Glenville that are my biggest concern, i.e. In neighborhoods where we see considerable out-migration and high vacancy rates, but where the streets still feel relatively intact, which strategy is more appropriate? These are the neighborhoods where I would be most concerned about seeing urban renewal-like consequences.

 

Great post!

 

There is currently a debate in Youngstown about whether or not to hire a city planner.  Those against the idea feel that the city can't afford it right now.  But, I feel a city planner is most important right now, because the city is currently demolishing houses without a plan; little/no effort is being made to stabilize or improve neighborhoods that could be desirable.

Strap, I think the widespread observable results of Urban Renewal speak for themselves, and they look nothing like that concept.  Every era produces nifty plans that get no traction.  There's no way that picture was going to get built during Urban Renewal.  Instead we got CSU campus and Erieview plaza, perfect examples of then-dominant thinking.

^I can't argue with the results.  Just your revisionist assertion that de-densification was always the plan to begin with.  It's easy to look back now and call them naive for thinking those plans were viable, but I assure you expectations back then were quite high. 

 

In any case, certainly a nice reminder that sweeping planning/redevelopment efforts often have unanticipated results.

True that.

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods don’t come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

Key point. Always follow the money trail.

And right on cue, more coverage today in the NYT:

 

The Odd Challenge for Detroit Planners: How to Shrink a City

http://www.nytimes.com/2011/04/06/us/06detroit.html?hp

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods don’t come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

Key point. Always follow the money trail.

 

True to a point, but the question then becomes, why are those who accept the validity (or at least the potential validity) of the "managed shrinkage" concept so particularly concerned with the prospect that a developer might come in and buy a massive amount of the newly-consolidated land?  If the whole point of managed shrinkage "is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential," wouldn't it actually be a good sign if a developer were suddenly interested in that land where the market (largely through near-complete lack of interest) had destroyed that density?  Why would it be a bad thing if hundreds of acres that no one had wanted for years (or even close to a full generation now) suddenly turned into hundreds of acres that someone actually did want?  After all, we're not talking about giving the developer eminent domain powers over the better neighborhoods where the managed shrinkage policy would increase density; we're talking about a developer coming in and making a regular market purchase (from the government or land bank or whatever) of the newly emptied land.  That land doesn't do the city much good just sitting there.

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods dont come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

Key point. Always follow the money trail.

 

True to a point, but the question then becomes, why are those who accept the validity (or at least the potential validity) of the "managed shrinkage" concept so particularly concerned with the prospect that a developer might come in and buy a massive amount of the newly-consolidated land?  If the whole point of managed shrinkage "is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential," wouldn't it actually be a good sign if a developer were suddenly interested in that land where the market (largely through near-complete lack of interest) had destroyed that density?  Why would it be a bad thing if hundreds of acres that no one had wanted for years (or even close to a full generation now) suddenly turned into hundreds of acres that someone actually did want?  After all, we're not talking about giving the developer eminent domain powers over the better neighborhoods where the managed shrinkage policy would increase density; we're talking about a developer coming in and making a regular market purchase (from the government or land bank or whatever) of the newly emptied land.  That land doesn't do the city much good just sitting there.

 

I forgot about this aspect of the story.  There are rumors that investors are starting to buy up vacant land in and around Youngstown for natural gas drilling.  So, without oversight, that aspect of downsizing could cause many unwanted/unintended problems in the future.

That was my tought exactly regarding the private developer line..

We're talking about knocking down the remaining three houses on blocks that once houses hundreds of people,

 

Ironically its those last few houses that might be in the best shape, sometimes with an old retired couple living in them.

 

But yeah, realistically speaking there is going to be shrinking and how do you manage that.  Its more than the built environment, which we focus on here at UO, but its also tax revenue and city budgets that are shrinking.  So there is an entire panoply of cut-back management issues surfacing from population decline.

 

If the whole point of managed shrinkage "is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential,"

 

In some ways this describes the idea behind Urban Renewal.  That the city was obsolete and drastic measures (as in land assembly into larger parcels, revision of street networks, and demolition) where needed to renew the city.  In the case of 1950s/60s urban renewal the idea was to put "something" (usually a modernist something) back in place.  This new version doesn't bother with pretty renderings of a the new city, but just turns things into open space.

 

 

 

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods don’t come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

Key point. Always follow the money trail.

 

True to a point, but the question then becomes, why are those who accept the validity (or at least the potential validity) of the "managed shrinkage" concept so particularly concerned with the prospect that a developer might come in and buy a massive amount of the newly-consolidated land?  If the whole point of managed shrinkage "is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential," wouldn't it actually be a good sign if a developer were suddenly interested in that land where the market (largely through near-complete lack of interest) had destroyed that density?  Why would it be a bad thing if hundreds of acres that no one had wanted for years (or even close to a full generation now) suddenly turned into hundreds of acres that someone actually did want?  After all, we're not talking about giving the developer eminent domain powers over the better neighborhoods where the managed shrinkage policy would increase density; we're talking about a developer coming in and making a regular market purchase (from the government or land bank or whatever) of the newly emptied land.  That land doesn't do the city much good just sitting there.

 

OMG, worst libertarian ever!  :)  I think the fear is that private interests could use this "movement" to coopt the government's power to coerce recalcitrant residents into moving; if not through ED then through witholding services.  Which is a risk, but yeah, getting private investors interested again is one of the express goals of this kind thinking.  But FYI, you seem to be directing your reaction to the wrong side- that quoted concern was voiced by a skeptic of planned shrinkage, not a believer.

We're talking about knocking down the remaining three houses on blocks that once houses hundreds of people,

 

Ironically its those last few houses that might be in the best shape, sometimes with an old retired couple living in them.

 

Then don't kick the old people out of their home (especially if they own it, not just rent it) ... but knock down the other vacant properties in the meantime.  Then, when the old couple is unfortunately no longer able to live independently (and therefore has to leave because of their life circumstances) or passes on, finish up then.  There is nothing that requires that this process of land assembly be rushed or draconian.  Even city legislators and mayors who might seriously want to see tax-producing structures on those large assembled parcels sooner rather than later might well not be in any particular hurry to have the newspapers and blogs trumpeting their fight to kick an old retired couple out of their home, after all (and we have legal protections in Ohio now that go beyond the federal minimum for that kind of thing, anyway).

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods don’t come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

Key point. Always follow the money trail.

 

True to a point, but the question then becomes, why are those who accept the validity (or at least the potential validity) of the "managed shrinkage" concept so particularly concerned with the prospect that a developer might come in and buy a massive amount of the newly-consolidated land?  If the whole point of managed shrinkage "is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential," wouldn't it actually be a good sign if a developer were suddenly interested in that land where the market (largely through near-complete lack of interest) had destroyed that density?  Why would it be a bad thing if hundreds of acres that no one had wanted for years (or even close to a full generation now) suddenly turned into hundreds of acres that someone actually did want?  After all, we're not talking about giving the developer eminent domain powers over the better neighborhoods where the managed shrinkage policy would increase density; we're talking about a developer coming in and making a regular market purchase (from the government or land bank or whatever) of the newly emptied land.  That land doesn't do the city much good just sitting there.

 

OMG, worst libertarian ever!  :)  I think the fear is that private interests could use this "movement" to coopt the government's power to coerce recalcitrant residents into moving; if not through ED then through witholding services.  Which is a risk, but yeah, getting private investors interested again is one of the express goals of this kind thinking.  But FYI, you seem to be directing your reaction to the wrong side- that quoted concern was voiced by a skeptic of planned shrinkage, not a believer.

 

No, I realized that--hence the tone of my post was, in essence, "why so skeptical?"

 

I didn't see where the concern was raised about the private developers forcing or pressuring the existing residents out; it looked to me like a flat statement that having developers get their hands on the land at a discount (a discount from what, I wonder) at all.

Another issue is how we effectively and efficiently maintain quality levels of service for that handful of retired couples. Should we spread our limited  police patrol capacity over entire cities, including areas that have rural-level populations within the city, or focuses our efforts on places where there is a larger density of residents? How about fire protection? Water maintenance, trash pickup, etc., etc., etc. In cities where tax bases are shrinking but geographic coverage isn't, that's one huge benefit of planned shrinkage ... Basically responding to the decentralization of population by virtually taking low-density/low-demand land off the grid. If we don't pursue that type of strategy, I think we have to think creatively about how we financially support base services citywide without raising the per-resident cost to do so.

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods don’t come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

Key point. Always follow the money trail.

 

True to a point, but the question then becomes, why are those who accept the validity (or at least the potential validity) of the "managed shrinkage" concept so particularly concerned with the prospect that a developer might come in and buy a massive amount of the newly-consolidated land?  If the whole point of managed shrinkage "is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential," wouldn't it actually be a good sign if a developer were suddenly interested in that land where the market (largely through near-complete lack of interest) had destroyed that density?  Why would it be a bad thing if hundreds of acres that no one had wanted for years (or even close to a full generation now) suddenly turned into hundreds of acres that someone actually did want?  After all, we're not talking about giving the developer eminent domain powers over the better neighborhoods where the managed shrinkage policy would increase density; we're talking about a developer coming in and making a regular market purchase (from the government or land bank or whatever) of the newly emptied land.  That land doesn't do the city much good just sitting there.

 

I don't accept the validity of the shrinking city model. In most cases, it's "throw in the towel," "let the suburbs win," or most likely, "reduce inventory to prop up home prices". Let the market handle itself. Excess inventory is good in the Rust Belt. We need cheap prices to attract young people. That's our main selling point. I see the shrinking city as part of the bigger plan of reducing inventory like done with the Neighborhood Stabliization Program. Obviously our core cities are still too expensive for consumers in the Rust Belt. We have suburban sprawl growth with decline in the city. The lower the prices go, the better. There is a tipping point where people will move back to the city just because it's such a better deal. That won't be as easy to pull off if we consolidate everyone into low vacancy blocks. Our high vacancy is what is keeping prices low, and gives the cities a fighting chance. The last thing I want in Ohio is some sort of New York situation where vacancy is reduced, rents and home prices skyrocket, and young people in their new economy jobs are priced out. That will assure our cities won't recover population. The new economy requires far more low-cost housing than is currently available. There is a movement in Ohio of buying homes at bargain prices in the central city. Young people don't want suburbs and they don't want a big house for kids they can't afford.

 

If we shrink our cities, we reduce the potential of this urban market. Regionally, we are not at the point where we need to start tearing out swaths of our cities. The issue is sprawl, not wholesale regional decline (yet). This isn't Russia.

 

I didn't see where the concern was raised about the private developers forcing or pressuring the existing residents out;

 

That's precisely my concern. Someone getting rich through eminent domain. This has already happened in Ohio with manufacturing sites. This can't be done effectively without some level of eminent domain. There are just too many cases of a few occupied homes left on the block.

From the NYT Detroit article, it sounds like holdouts in the sparse areas would get reduced city services, as an overt nudge to move on.

 

Re inventory, I strongly believe we need to reduce it.  That doesn't mean I necessarily accept the shrinking city model, I just think some of that inventory needs to be turned over.  Shelf life expired.  And the amount of wreckage we have around here does keep prices very reasonable, but it also repulses investment and new residents.  Our main selling point should not be the fact that nobody wants all these houses.  To me, that's more of a surrender than tearing them down.         

Obviously our core cities are still too expensive for consumers in the Rust Belt.

 

That is a very bizarre conclusion, IMHO.

I disagree with the notion of reducing inventory in a place like Ohio or Michigan. Anything to keep prices low in the Rust Belt is a good thing. Excess inventory is what keeps prices low- law of supply and demand. That's our main selling point, and it could stop the brain drain to the higher-priced coasts and Texas. People are leaving due to not only lack of jobs, but lack of bang for buck. Even though places are cheap in our cities, they are not cheap enough. Otherwise people wouldn't still be moving to the suburbs. The Blade just an article on what types of homes buyers in this economy are looking for. The cheapest, smallest homes in the area are selling the fastest! There is no reason what is happening in Toledo shouldn't be the norm in Ohio. Let's keep these 25k homes on the market. They are attractive to buyers and landlords who will rent them cheap. That's what is needed for the new lower-paying jobs in Ohio. Our median incomes are declining. Our home prices should follow suit.

 

LIVIN' LITTLE

Tiny houses a bright spot in slow Toledo sales picture

BY JON CHAVEZ

BLADE BUSINESS WRITER

 

The Toledo real estate market remains mostly dormant for spacious existing homes and large new ones, but one segment of the market is still generating buyers: tiny homes. Houses of 800 square feet or less continue to pull in buyers -- mainly investors -- who with the depressed real estate market can purchase such homes for a tenth of the cost of a 2,000-square-foot house. With a few thousand in investment, they can convert these structures into solid rental property.

 

http://www.toledoblade.com/Real-Estate/2011/03/27/LIVIN-LITTLE.html

 

We need to not jump the gun on this shrinking city thing. The government should step out of the demolition and destruction business. Those so-called "crap homes" are what is selling. 10 years ago, nobody thought these homes were worth saving. Things change. I've seen plenty of 10k sales in the slums turn into $300 a month rentals. That's what people in the Rust Belt want and need. Look, we're talking going from $20 an hour to $10 an hour. The market isn't there in mass for ornate urban homes, fancy lofts, or badass rowhousing. The market is there for what people previously thought were junkers. Once these crappier homes are gone, and we've landbanked the sh!t out of our cities, prices will increase.

 

This is an Ohio success story:

http://www.toledoblade.com/image/2011/03/26/800x_b1_cCM_z_%232235/LIVIN-LITTLE-3.jpg

Obviously our core cities are still too expensive for consumers in the Rust Belt.

 

That is a very bizarre conclusion, IMHO.

 

Then why are people still leaving? A home is only worth what someone is willing to pay for it.

- How do we guarantee that the notion of shrinking cities does not become cover for private developers looking to assemble massive parcels of centrally located and well-connected urban land on the cheap? The most successful efforts of renewing old urban neighborhoods don’t come from top-down reclamation schemes but from organic, bottom-up, community-based efforts to strengthen and build on neighborhood assets.

 

Key point. Always follow the money trail.

 

True to a point, but the question then becomes, why are those who accept the validity (or at least the potential validity) of the "managed shrinkage" concept so particularly concerned with the prospect that a developer might come in and buy a massive amount of the newly-consolidated land?  If the whole point of managed shrinkage "is an effort to assemble land where the market has already destroyed density at the same time that we're increasing density in neighborhoods where there is more market potential," wouldn't it actually be a good sign if a developer were suddenly interested in that land where the market (largely through near-complete lack of interest) had destroyed that density?  Why would it be a bad thing if hundreds of acres that no one had wanted for years (or even close to a full generation now) suddenly turned into hundreds of acres that someone actually did want?  After all, we're not talking about giving the developer eminent domain powers over the better neighborhoods where the managed shrinkage policy would increase density; we're talking about a developer coming in and making a regular market purchase (from the government or land bank or whatever) of the newly emptied land.  That land doesn't do the city much good just sitting there.

 

I don't accept the validity of the shrinking city model. In most cases, it's "throw in the towel," "let the suburbs win," or most likely, "reduce inventory to prop up home prices". Let the market handle itself. Excess inventory is good in the Rust Belt. We need cheap prices to attract young people. That's our main selling point. I see the shrinking city as part of the bigger plan of reducing inventory like done with the Neighborhood Stabliization Program. Obviously our core cities are still too expensive for consumers in the Rust Belt. We have suburban sprawl growth with decline in the city. The lower the prices go, the better. There is a tipping point where people will move back to the city just because it's such a better deal. That won't be as easy to pull off if we consolidate everyone into low vacancy blocks. Our high vacancy is what is keeping prices low, and gives the cities a fighting chance.

 

I don't really see this dynamic at work. 

 

There is a difference between price and value.  Price is what you pay; value is what you get for what you pay.  The prices in many parts of our hollower cities are already rock-bottom, but the value is still not good enough to entice buyers.  Low prices alone aren't enough.  There are places in Akron right now where you can get a beat-up vacant home for next to nothing.  I have to imagine that things are even worse in Youngstown and Detroit and Gary.  (I just did a quick Trulia search on Youngstown and found almost 200 homes under $25,000.)  There are neighborhoods there where you couldn't give the properties away--not to owner-occupiers, at any rate, and possibly not even to investors, even if you forgave all tax liens and prospectively waived any health and environmental citations.

 

You are right that "there is a tipping point where people will move back to the city just because it's such a better deal."  To reach that tipping point, however, lowering prices further won't do it; they're already ridiculously low.  This is particularly true if we're talking about deliberately allowing the built environment to stay uninviting, poorly served, or even dangerous.

The prices in many parts of our hollower cities are already rock-bottom, but the value is still not good enough to entice buyers.  Low prices alone aren't enough.

 

I used to think this until I started to see what was happening in Toledo:

 

Currently the Toledo area's multiple listing service has 142 active listings of houses under 800 square feet. In the last 12 months, 184 under 800 square feet were sold, Ms. Coleman said. Many of those listed small homes are in foreclosure or are going through short sales, real estate agents said. Jon Modene, of Re/Max Masters in Perrysburg, recently took over two small-house listings, both on Favony Avenue in Holland; the owners were foreclosed upon for not paying property taxes. One house is 648 square feet, the other 768 square feet, he said. One is listed at $26,900, and the price of the other has yet to be set. The low price of such houses attracts investors such as Andrew Schober, a Toledo school teacher who lives in Riga, Mich. Last May, he bought a home on Brussels Street in West Toledo for $11,000. In 2009, the 624-square-foot house sold for $28,000. He recently rented the house to a young couple who had lived in an apartment building that he owns.

 

The tipping point has probably been reached in Toledo, at least as far as central-city homes being attractive to landlords planning to rent them cheap. Once prices get around the 25k level, you start to attract buyers. At 10k, you'll attract a couple buyers, even in the worst slums. I think people are really under-estimating how much our economy has changed in Ohio. Prices are too expensive for many of the newly created jobs that pay much less than previous jobs. Sure, someone who is wealthy and middle class doesn't get this, but don't let middle class sampling error make you think prices are rock-bottom (again, it's only worth what someone is willing to pay, so they are not ridiculously low- they are what the free market dictates). Ohio is getting poorer. Prices need to continue to decline to around the 10k level in the slums. Then things start to change for the better. We've got to maintain the inventory to let this happen.

 

Cities like Detroit, Cleveland, Toledo, and Buffalo don't want to accept this. "$10,000 houses, but what about our property taxes?!" I'd rather have an occupied city of crappier homes with people who have discretionary income because their housing costs are cheap as opposed to shrunken city of more expensive homes filled with college kids and yuppies stretching themselves too thin. What gets people out on the street spending money is not being a slave to their housing costs.

I do think C-Dawg has a point, in that homegrown YP's often can't afford what few deluxe accomdations our area offers.  Incomes too low, educational costs too high.  But I believe the only long term solution to that is improving the economy, which means attracting investment from outside the region, which means we have to make our cites presentable.

Obviously our core cities are still too expensive for consumers in the Rust Belt.

 

That is a very bizarre conclusion, IMHO.

 

Then why are people still leaving? A home is only worth what someone is willing to pay for it.

 

Ahh, you mean they're overpriced.  I thought you meant unaffordable.  I agree with Gramarye though.  Prices are already so low that they don't even sustain physical maintenance in a lot of cases.  Any sustainable growth in our core cities is going to come from improved amenities, changed tastes or increasing prices in competing areas [suburbs] rather than further price declines.

I think outside investors are looking for low prices more than anything else, and that goes triple or quadruple in the Rust Belt. In Toledo's slums, many buyers are coming from overseas (a good number of buyers from Australia). Some aren't even setting foot in America. They just see a good price in central city Toledo on the internet, hire someone local to fix it up, and then rent it for cheap and/or sell it later for more money. The business model is working. They buy the house at 10k, renovate it (you can find talented guys for dirt cheap in Toledo), and then sell it for 25k or rent it for $300 a month. I fail to see how this is a bad thing in the Rust Belt.

 

But I believe the only long term solution to that is improving the economy

 

I agree, but nobody has the answer for that in Ohio. I think low housing costs are a big part of it though. That's attractive to someone who wants to open up a business so his employees aren't going to bed hungry at night. We need to resist this shrinking city plan as much as possible. What Detroit is planning on doing is suicide. They will likely shrink to 500k if they tear down all their vacant properties and cut off access to these former neighborhoods. That will drive up prices on occupied properties, leading to more exodus. Detroit's prices need to stay rock bottom until an economic miracle happens. Ditto with Cleveland. Ditto with Toledo. Ditto with Dayton. These are unique cases in America, places of long-term economic ruin, not some short-term housing bust/recession crap like the Sun Belt. And they have regional loss. Why focus entirely on shrinking the city? Things are already too disconnected. This only makes it worse since it creates big holes in the metro area.

 

This is a game of musical chairs. By shrinking the city which will maintain and/or drive up prices, we push poverty somewhere else. I do think this is pretty terrible and at least one of the goals of the shrinking city model. Yuppies don't want to be around poverty. We all know the shrinking city model isn't actually possible on a significant scale without forcing some people off their property. Even in Detroit, there are plenty of holdouts. I wonder who will be forced out? Probably the same people who were forced out by highway construction and probably the same people who were forced out by urban renewal.

 

This is dangerous territory, and given the political direction of this country, we have plenty of reason to be wary of these plans. Any time we're talking about a significant displacement (not regional reduction) of resources, somebody is going to pay the price for that. If we're going to have shrinking city model, we need to have a shrinking region model. I'm all ears for that. The problem is sprawl growth with a shrinking city.

Heh.  Before your last post, C-Dawg (and your editing of your original post that I quoted), I had assumed that you were the one suffering from middle class sampling error.  When you said that our core cities are still too expensive for consumers in the Rust Belt, I assumed that your only point of reference was gentrified, white collar urban neighborhoods, because those are the only ones that I could really say might have overshot the mark in terms of price appreciation.

 

I definitely understand and agree with your point that we want people in less expensive houses with more discretionary income; I've made that argument myself several times over on the U.S. Recession thread, when people tout continued weakness in the housing market as a horrible sign for the economy.  That said, I don't think maintaining an oversupply of dilapidated and dangerous properties is the right way to go about doing that.  Some of the work to keep a lid on the housing market could and should be done at the federal level, and would lower the price on urban and suburban homes alike: eliminating Fannie and Freddie, eliminating the mortgage interest tax deduction (why in the world are we subsidizing paying interest instead of building equity, anyway?), raising the prime rate at the Fed, and requiring 10% or even 20% down payments for all but the most creditworthy borrowers, for example.  The difference between these measures and what you suggest is that these don't affect the intrinsic worth--the physical characteristics and utility--of the house or the neighborhood.  Your "benign neglect" would.

Agree we need to deep-six Fannie and Freddie and the mortgage interest tax deduction. Also, I agree with larger down payments, but it's much easier to do that with rock bottom prices. Low home prices make that 20% down payment much easier for the average Rust Belter getting a job in the new economy. We're not talking $20 an hour manufacturing jobs for people without any debt. We're talking $12 an hour jobs entry-level jobs for generic college grads with massive debt. If we want to stop the brain drain, we need to do everything we can to keep home prices low. The three big things that lower property values are bad location, bad condition, and high vacancy. I suspect in the case of Ohio cities, high vacancy is the biggest issue. Location is better than the suburbs (except for schools), and conditions widely vary. We need to fill as much of this vacancy as we can, not tear it down.

 

That said, I don't think maintaining an oversupply of dilapidated and dangerous properties is the right way to go about doing that.

 

At least in Toledo's case, only a fraction of the abandonment is dangerous (though of course homeless people use them and sometimes crimes happen in them). The majority of Toledo's homes are salvageable. A lot of these so-called "lost causes" are structurally sound, and some are finding investors in this market. In terms of properties beyond the point of no return, there are a lot of them, but it's not yet the majority. The problem with the shrinking city model is that it's likely going to treat all abandonment the same. They'll say "Neighborhood X is 75% vacant, let's kick out the rest of these people and cut it off. Neighborhood Y is 75% occupied. It gets saved." What they won't talk about is the condition or quality of that abandonment. I can think of areas in Toledo where there are plenty of great buildings worth saving but hardly anyone living there. In the shrinking city model, these areas are toast. And I only support publicly-funded demolitions in the case of emergency (say after a bad arson or a wall starts to fall into the street). This could get really expensive really fast, much like urban renewal. Yeah, it's a one-time cost, but not something any Rust Belt city can remotely afford. The utilities savings won't cover it since they continue to spread further and further from the city into the sprawlholes. Cost savings are likely to be minimal. Yeah, you'll save snow removal costs and road repairs, but it's not like those are priorities in high abandonment neighborhoods anyway. I suppose you save on garbage.

 

Frankly, I see the bigger issue being continued suburban sprawl at the expense of the city. The shrinking city model doesn't tackle this issue at all, but does add fuel to the fire. One of the mega sprawlers like Beavercreek could just say to its neighbors, "Look at those losers in Dayton! It's such a horrible city, they're just giving up!" I could see those brochures now: "Come to Beavercreek. Unlike Dayton, we're not tearing down half the city and letting it turn into a prairie. We pave over our prairies. Beavercreek is growing and thriving. This is where you want to invest your money." This just makes it that much easier for the growing suburbs to sell themselves. In that regard, it won't just hurt the city, but also inner-ring suburbs that are seeing increasing abandonment. So our footprint just gets more and more ridiculous.

^I agree with some of those changes (though the Fed doesn't set the "prime rate" if you mean it in the mortgage sense), but if they were all implemented, you'd be doing a lot more than just reducing the sales price of housing- you'd also be significantly altering the homeownership and wealth accumulation prospects of a substantial segment of the population, which will likely have its own unintended consequences.  I suppose this isn't the thread for general housing policy discussion though.

 

I think outside investors are looking for low prices more than anything else, and that goes triple or quadruple in the Rust Belt. In Toledo's slums, many buyers are coming from overseas (a good number of buyers from Australia). Some aren't even setting foot in America. They just see a good price in central city Toledo on the internet, hire someone local to fix it up, and then rent it for cheap and/or sell it later for more money. The business model is working. They buy the house at 10k, renovate it (you can find talented guys for dirt cheap in Toledo), and then sell it for 25k or rent it for $300 a month. I fail to see how this is a bad thing in the Rust Belt.

 

There is a substantial body of anecdotal evidence from people in the field and a growing body of research tracking these ultra low cost houses and investor purchases, and I have never heard this spun as a happy story.  In Cleveland at least, houses sell for $10k because they don't have plumbing, are otherwise uninhabitable, or have a demo lien on them.  In general, they suffer a prolonged period of vacancy as a neighborhood eyesore or have a date with the wrecking ball, not some Australian investor's hired crew.  So yeah, having an enormous glut of unwanted housing offers some people a bargain, but at pretty substantial public cost.  Nothing wrong with a sliver lining, but I don't think it's more than that.

I can see the argument that absentee landlords (alright, some are slumlords) aren't the best thing for a city. But I also think this will lead to a more gradual recovery of home values in the city than the shrinking city model. The shrinking city model will be a shock to the system, artificially created by government forces. It could cause prices to rise fast since vacancies would be reduced quickly. I'm dead serious that this could price out a lot of prime target audience and lead to displacement of the poor through eminent domain. There is precedent for this.

 

If vacancies are reduced slowly on existing stock (limit demolitions to the absolute worst structures, don't tear down all areas with widespread abandonment), prices slowly recover. I think the slower model is better than the faster one. The shrinking city model is probably yet another of our brilliant quick-fix solutions much like urban renewal. I'm with Richard Florida in his arguments, though I'll concede he grossly underestimates the problems of the Rust Belt.

This is what has been happening in Toledo. I think if it's happening here, it can happen anywhere. But after reading the following article, I'm not sure if this is a good thing (just better than the alternative). These guys just view Toledo as a get rich quick scheme. Still, absentee landlords are better than shrinking cities.

 

Deals in Toledo lure overseas, out-of-state buyers to pounce on foreclosures

 

Area residents may lament Toledo's ongoing housing woes and their struggles to retain foreclosure-racked home values, but those elsewhere are beginning to find opportunity amid the carnage. Local real estate brokers - especially those who specialize in foreclosed properties - say they are seeing an increasing number of buyers from out of state and overseas who are snapping up low-cost foreclosed homes to turn them into rental properties.

 

"I have a guy from Australia showing up next week," said Jon Modene, an agent with Re/Max Masters in Perrysburg.

 

Mr. Modene said he is helping buyers in both Australia and Great Britain to purchase income property in Toledo. Even though the bulk of foreclosed houses are bought by local people, he has worked with foreign buyers who snapped up one or two houses at a time. Purchases in higher multiples by those buyers probably are coming, he said.

 

"As one [foreign buyer] explained it to me, the cheapest house where he lives is $250,000, and it's not livable. But they come to Toledo, and for $250,000 they can buy 100 [rental] houses at the $2,500 price point. It's like a joke to them, our housing values," Mr. Modene said.

 

...Many of those purchasing foreclosed homes for income property are setting up shell companies or limited liability corporations to handle the transactions, which can effectively conceal a property's true ownership. Mr. Jones from Australia buys his homes under J. Ventura Holdings. The biggest areas with such purchases are in East and North Toledo, and generally are houses selling for under $20,000, area real estate agents said. Shawn Kellerbauer, a broker with Danberry Realty, said he recently had two closings involving out-of-state investors whose individual business models steered them toward properties in North and East Toledo.

 

Mr. Jones said his Internet research for investment opportunities led him to Toledo. He said the "highest yields were still to be found in Toledo." He added: "The property prices had plummeted. People were terrified to buy and were now looking to rent. This pushed the cost of housing down while keeping rental prices stable.

 

"I understood that the quality of the houses hadn't fallen, just the perceived value of the houses. I figured that, as the banks weren't real estate agents, the properties being foreclosed were probably being sold at a huge discount."

 

Mr. Kellerbauer said the out-of-state buyers seem to have an advantage in the foreclosure market because they generally have better access to capital. Many banks are reluctant to write mortgages on properties where the relative risk may outweigh the rate of return, so the local foreclosure market favors those with cash to spend, he said.

 

http://www.toledoblade.com/Real-Estate/2010/11/14/Deals-in-Toledo-lure-overseas-out-of-state-buyers-to-pounce-on-foreclosures.html