[NYguy]

http://www.forbes.com/2009/02/12/cities-ten-top-lifestyle-real-estate_0212_cities.html

America's Emptiest Cities
Vacancy rates in these spots spell lots of empty neighborhoods.

Zack O'Malley Greenburg
02.12.09


Call it a modern-day tale of two cities.

For decades, Las Vegas, ripe with new construction and economic development, burgeoned into a shimmering urban carnival. Detroit, once the fulcrum of American industry, sagged and rusted under its own weight.

Las Vegas edged Detroit for the title of America's most abandoned city. Atlanta came in third, followed by Greensboro, N.C., and Dayton, Ohio. Our rankings, a combination of rental and homeowner vacancy rates for the 75 largest metropolitan statistical areas in the country, are based on fourth-quarter data released Feb. 3 by the Census Bureau. Each was ranked on rental vacancies and housing vacancies; the final ranking is an average of the two.

Cities like Detroit and Dayton are casualties of America's lengthy industrial decline. Others, like Las Vegas and Orlando, are mostly victims of the recent housing bust. Boston and New York are among the lone bright spots, while Honolulu is the nation's best with a vacancy rate of 5.8% for homes and a scant 0.5% for rentals.

Still, empty neighborhoods are becoming an increasingly daunting problem across the country. The national rental vacancy rate now stands at 10.1%, up from 9.6% a year ago; homeowner vacancy has edged up from 2.8% to 2.9%. Richmond, Va.'s rental vacancy rate of 23.7% is the worst in America, while Orlando's 7.4% rate is lousiest on the homeowner side. Detroit and Las Vegas are among the worst offenders by both measures--the Motor City sports vacancy rates of 19.9% for rentals and 4% for homes; Sin City has rates of 16% and 4.7%, respectively.

"It's a mess," says Vegas developer Laurence Hallier. "Right now, things are just frozen. Everybody's scared."

Hallier, 40, knows from experience. His $600 million Panorama Towers complex was a tremendous success at its inception three years ago. The first of his four planned residential skyscrapers sold out in six months; the second, which opened in 2007, sold out in 12 weeks. As the third tower neared completion last fall, Hallier had sold 92% of its units. Then the recession hit, and only half the units ended up closing. Hallier says it will take years to break even, and plans for the fourth tower have been delayed indefinitely.

There are others who've made--and lost--far worse gambles on Vegas property. In 2007, Israeli billionaire Yitzhak Tshuva and partner Nochi Dankner paid $1.25 billion to buy a 34.5-acre site on the Strip, with plans to build an $8 billion mega-casino modeled after New York's Plaza Hotel. By November, the value of the lot had plummeted to $650 million--half what they paid for it. Groundbreaking on the casino has been pushed back to 2010, and today, the land may be worth less than the $625 million Tshuva and Dankner borrowed to buy it.

The Plaza debacle is emblematic of the problems afflicting millions of property owners in Vegas and around the country--and can explain, in large part, the origins of America's housing crisis.

As real estate prices skyrocketed during the boom, consumers took out massive loans to buy homes, assuming values would continue to rise. Instead they took a nosedive, especially in places like Las Vegas, Florida and Phoenix, where the housing boom had created excess inventory and so-called "bad loans" were rampant. Many homeowners suddenly found themselves with properties worth far less than the mortgages they'd taken out. In the worst cases, banks foreclosed, leaving people without homes--and with more debt than they'd had to begin with.

The situation in places like Las Vegas is bad enough, but Detroit's problems run much deeper. Though its vacancy rates are marginally better than Sin City's, Motown has been on the empty side for decades. An industrial boomtown during the first half of the 20th century, Detroit's population swelled from 285,000 in 1900 to 990,000 in 1920, reaching a peak of 1.8 million in 1950.

But starting in the 1960s, Detroit began a precipitous decline. Detroit's population is now 900,000--half what it was in the middle of the century--and many of its neighborhoods languish in varying states of decay. Most scholars blame rapid suburbanization, outsourcing of manufacturing jobs, and federal programs they say exacerbated the situation by creating a culture of joblessness and dependency.

Yet after more than half a century, countless scholars, politicians, community organizers developers and nonprofit workers have been unable to come up with a solution to fix Detroit.

Will Las Vegas eventually suffer the same fate?

"I don't think Vegas is overbuilt," says Hallier. "Despite what everybody says, Vegas still has 2 million people."

Time will tell if this sort of optimism is warranted. Cynics who've witnessed Detroit's decline might liken Hallier's opinions to another Dickens oeuvre: Great Expectations.

[NYguy]

http://www.forbes.com/2009/02/12/cities-ten-top-lifestyle-real-estate_0212_cities_slide_2.html?thisspeed=25000
In Depth: America's Emptiest Cities


http://images.forbes.com/media/2009/02/06/0206_vacancy_02_cincinnati.jpg
No. 15 (Tie): Cincinnati, Ohio/Middletown, Ky.
Rental Vacancy Rate: 9.8% (tied, 36th)
Home Vacancy Rate: 4.3% (tied, sixth)
Average Rank: 21st


http://images.forbes.com/media/2009/02/06/0206_vacancy_03_bakersfield.jpg
No. 14: Bakersfield, Calif.
Rental Vacancy Rate: 14.7% (tied, 14th)
Home Vacancy Rate: 3.1% (tied, 26th)
Average Rank: 20th


http://images.forbes.com/media/2009/02/06/0206_vacancy_04_tampa.jpg
No. 13: Tampa/St. Petersburg/Clearwater, Fla.
Rental Vacancy Rate: 15.6% (11th)
Home Vacancy Rate: 3% (tied, 28th)
Average Rank: 19.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_05_chicago.jpg
No. 12: Chicago/Naperville/Joliet, Ill.
Rental Vacancy Rate: 11.8% (22nd)
Home Vacancy Rate: 3.7% (14th)
Average Rank: 18th


http://images.forbes.com/media/2009/02/06/0206_vacancy_06_miami.jpg
No. 11: Miami/Ft. Lauderdale/Miami Beach, Fla.
Rental Vacancy Rate: 13.1% (20th)
Home Vacancy Rate: 3.6% (tied, 15th)
Average Rank: 17.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_07_indianapolis.jpg
No. 9 (Tie): Indianapolis, Ind.
Rental Vacancy Rate: 17.1% (sixth)
Home Vacancy Rate: 3.2% (tied, 23rd)
Average Rank: 14.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_08_jacksonville.jpg
No. 9 (Tie): Jacksonville, Fla.
Rental Vacancy Rate: 14.7% (tied, 14th)
Home Vacancy Rate: 3.6% (tied, 15th)
Average Rank: 14.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_09_kansas.jpg
No. 8: Kansas City, Mo./Kansas City, Kan.
Rental Vacancy Rate: 15.2% (12th)
Home Vacancy Rate: 3.6% (tied, 15th)
Average Rank: 13.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_10_orlando.jpg
No. 7: Orlando, Fla.
Rental Vacancy Rate: 12.3% (21st)
Home Vacancy Rate: 7.3% (first)
Average Rank: 11th


http://images.forbes.com/media/2009/02/06/0206_vacancy_11_phoenix.jpg
No. 6: Phoenix/Mesa/Scottsdale, Ariz.
Rental Vacancy Rate: 19% (fifth)
Home Vacancy Rate: 3.6% (tied, 15th)
Average Rank: 10th


http://images.forbes.com/media/2009/02/06/0206_vacancy_12_dayton.jpg
No. 5: Dayton, Ohio
Rental Vacancy Rate: 21.7% (second)
Home Vacancy Rate: 3.6% (tied, 15th)
Average Rank: 8.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_13_greensboro.jpg
No. 4: Greensboro/High Point, N.C.
Rental Vacancy Rate: 15% (13th)
Home Vacancy Rate: (second)
Average Rank: 7.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_14_atlanta.jpg
No. 3: Atlanta/Sandy Springs/Marietta, Ga.
Rental Vacancy Rate: 16.1% (eighth)
Home Vacancy Rate: 4.3% (tied, sixth)
Average Rank: Seventh


http://images.forbes.com/media/2009/02/06/0206_vacancy_15_detroit.jpg
No. 2: Detroit/Warren/Livonia, Mich.
Rental Vacancy Rate: 19.9% (third)
Home Vacancy Rate: 4% (tied, 10th)
Average Rank: 6.5


http://images.forbes.com/media/2009/02/06/0206_vacancy_16_lasvegas.jpg
No. 1: Las Vegas/Paradise, Nev.
Rental Vacancy Rate: 16% (ninth)
Home Vacancy Rate: 4.7% (tied, third)
Average Rank: Sixth

[BnaBreaker]

Where the hell did they find those photos of Greensboro and Bakersfield?

[JMancuso]

so are rents really cheap now in chicago? i was there last year and met a women who paid 1100 a month to live in some highrise on/ near lakeshore drive.

[ColDayMan]

And if they put my city(ies) in that list, they at least better use more recent photos! Pfft!

[Evergrey]

You forgot to post Charlotte's photo, NYguy... Charlotte tied with Cincinnati for 15th

[rockyi]

Where the hell did they find those photos of Greensboro and Bakersfield?

Especially the Greensboro one. A water tower and a parking lot. :haha:

[bnk]

This is not a list I relish to be on.

The home owner vacancy is the most alarming figure IMB.

Wow Orlando.

[Jeeper]

Ohio just can't catch a break.

[Top Of The Park]

....those rental vacancy rates are amazing....there has to be some pretty good deals out there

[Tom In Chicago]

so are rents really cheap now in chicago? i was there last year and met a women who paid 1100 a month to live in some highrise on/ near lakeshore drive.

Rents in Chicago have always been affordable. . . cheap? I dunno. . . I suppose if you're coming from San Francisco or New York (which are both over-priced IMO) then yes. . . Chicago is quite cheap. . . I live in a high rise near Lakeshore Drive and pay just about $1,100.00/month if you including my indoor heated parking. . . but why anyone would want to live here if they had a choice is beyond me. . . as soon as I can I'm moving to Bakersfield! ;)

. . .

[glowrock]

Where the hell did they find those photos of Greensboro and Bakersfield?

:haha:

Yeah, I could have given them a better photo by by snapping a picture from my office window!

Aaron (Glowrock)

edit: Tom, kiss my ass! :)

[sharkfood]

No mention of Philadelphia on this list? I'm astonished. I thought we were the world capital of vacancy.

[FlashingLights]

Rents in Chicago have always been affordable. . . cheap? I dunno. . . I suppose if you're coming from San Francisco or New York (which are both over-priced IMO) then yes. . . Chicago is quite cheap. . . I live in a high rise near Lakeshore Drive and pay just about $1,100.00/month if you including my indoor heated parking. . . but why anyone would want to live here if they had a choice is beyond me. . . as soon as I can I'm moving to Bakersfield! ;)

. . .
Are you being sarcastic?

Bakersfield is a dump so lest hope that was sarcasm.

[BTinSF]

if you're coming from San Francisco or New York (which are both over-priced IMO)


There's no such thing as "over- (or under-) priced" for a market as a whole. The market sets the price levels. Individual units can be over- or underpriced compared to the market level, but not the entire market. And, yeah, it's worth twice as much to a lot of people to live in a place where temperatures are moderate summer and winter, you don't need A/C and can get through a whole winter without ever using the heat, gorgeous places like Sierra ski resorts, Big Sur or the CA Wine Country are a day trip and nobody judges your lifestyle. New York can speak for itself. But I doubt SF will ever make an "emptiest" list.

[Ayreonaut]

Are you being sarcastic?

Bakersfield is a dump so lest hope that was sarcasm.

It was sarcasm, Glowrock recently moved to Bakersfield. ;)

[Tom In Chicago]

There's no such thing as "over- (or under-) priced" for a market as a whole. The market sets the price levels. Individual units can be over- or underpriced compared to the market level, but not the entire market. And, yeah, it's worth twice as much to a lot of people to live in a place where temperatures are moderate summer and winter, you don't need A/C and can get through a whole winter without ever using the heat, gorgeous places like Sierra ski resorts, Big Sur or the CA Wine Country are a day trip and nobody judges your lifestyle. New York can speak for itself. But I doubt SF will ever make an "emptiest" list.

Oh sorry. . . I can see how easily confused you got reading my post without the obligatory tags. . . I'll be sure to include those next time I'm commenting on an absurd Forbes list. . . but thanks for your unsolicitied response. . . I'm a much better human being for having read that. . . now go back to enjoying the smell of your own farts ;)

. . .

[brian_b]

Rents in Chicago have always been affordable. . . cheap? I dunno. . . I suppose if you're coming from San Francisco or New York (which are both over-priced IMO) then yes. . . Chicago is quite cheap. . . I live in a high rise near Lakeshore Drive and pay just about $1,100.00/month if you including my indoor heated parking. . . but why anyone would want to live here if they had a choice is beyond me. . . as soon as I can I'm moving to Bakersfield! ;)

. . .

I've been watching rents in your neighborhood and they have been dropping for the past few months. They are now down into the range where a cheapskate like me is willing to rent over there. I'm seeing ~$2000 per month including parking for a 2BR + den. Owners of the new buildings are still asking $3000-$4000 - they are going to keep asking for that until they're foreclosed on.

[Vangelist]

>now go back to enjoying the smell of your own farts

Funny that you mention that ..when that South Park episode that lampooned snobby San Franciscans revolved around how they had "smug alerts," and how they'd all get off on the smell of their own smug farts (or was this a subtle/intentional reference?)

[hudkina]

I would think it isn't a coincidence. But then again, everyone already knew that Bay Area residents enjoyed the smell of their own farts...

[ignatius]

I'm really surprised to see KC on the list because it has a home supply of only 8.5 months, which is much better than many cities that have a 12-30 month supply.

There is a 15% office vacancy for the KC metro but it is also true for Denver and Dallas is over 20%, so confusing they aren't on the list.

Forbes has got to be the worst of statics compilers I've seen of list makers.

[hudkina]

They aren't comparing office vacancy rates. They just took the ranking of rental vacancies and combined it with the ranking for home vacancies and then re-ranked the combined rankings...

[JMancuso]

Rents in Chicago have always been affordable. . . cheap? I dunno. . . I suppose if you're coming from San Francisco or New York (which are both over-priced IMO) then yes. . . Chicago is quite cheap. . . I live in a high rise near Lakeshore Drive and pay just about $1,100.00/month if you including my indoor heated parking. . . but why anyone would want to live here if they had a choice is beyond me. . . as soon as I can I'm moving to Bakersfield! ;)

. . .

jesus. you pay 100 bucks more than i pay for a one-bedroom in a 40 year complex with toilets that overflow on a regular basis

[Tom In Chicago]

^Well my place is only a studio so at least you have an actual bedroom. . . which is handy. . .

[Tom In Chicago]

>now go back to enjoying the smell of your own farts

Funny that you mention that ..when that South Park episode that lampooned snobby San Franciscans revolved around how they had "smug alerts," and how they'd all get off on the smell of their own smug farts (or was this a subtle/intentional reference?)

of course it was intentional. . . I've been waiting all month to use that one on BT ;)

[BTinSF]

Ah, the perennial insecurity of the Chicago cohort.

People willingly pay much higher rents here and there aren't a lot of vacancies. It's a fact. Perhaps farts smell better here. Perhaps it's the things I mentioned. Regardless, we aren't "empty" and you are oozing envy.

PS: I sometimes think I like YOUR city more than most of you do. Otherwise it's hard to figure why you are so touchy about it.

[BnaBreaker]

Ah, the perennial insecurity of the Chicago cohort.

People willingly pay much higher rents here and there aren't a lot of vacancies. It's a fact. Perhaps farts smell better here. Perhaps it's the things I mentioned. Regardless, we aren't "empty" and you are oozing envy.

PS: I sometimes think I like YOUR city more than most of you do. Otherwise it's hard to figure why you are so touchy about it.

It's intense pride my man, not insecurity.

[Steely Dan]

Ah, the perennial insecurity of the Chicago cohort.

People willingly pay much higher rents here and there aren't a lot of vacancies. It's a fact. Perhaps farts smell better here. Perhaps it's the things I mentioned. Regardless, we aren't "empty" and you are oozing envy.

PS: I sometimes think I like YOUR city more than most of you do. Otherwise it's hard to figure why you are so touchy about it.

the only insecurity witnessed in this thread was your response to an offhand comment tom made about his feeling that new york and san fran are over-priced. so what if tom feels those places are over-priced? what's it to you?

tom is clearly joking around with you, but you seem to be taking his responses seriously. it's hard to figure why you are so touchy about his comment.

[BTinSF]

the only insecurity witnessed in this thread was your response to an offhand comment tom made about his feeling that new york and san fran are over-priced. so what if tom feels those places are over-priced? what's it to you?

tom is clearly joking around with you, but you seem to be taking his responses seriously.

It wasn't insecurity. It was a statement of economic fact. When the average rent of an entire market is being examined, it is what it is. There are metrics to argue it is over or underpriced (such as relationship to wage levels and so on) but those don't take into consideration the intangibles that likely cause the diversion from what would be expected. Lifestyle is one such intangible.

What's it to me? I thought this was a serious discussion. Maybe it belongs in Skybar.

[Steely Dan]

when tom said that he thought that san fran and new york were overpriced, it was clear to me that he was speaking for himself, as in he wouldn't want to pay the cost to live in those cities. he wasn't making some fact-based macro-level economic judgement of the two cities, just expressing his personal preference.

it's not hard to understand.

some people think london is overpriced.
some people think san francisco is overpriced.
some people think chicago is overpriced.
hell, there's probably a even few odd-ball mega-cheapskates out there who think that peoria is overpriced.

[JMancuso]

^Well my place is only a studio so at least you have an actual bedroom. . . which is handy. . .

dunno, i'd take a little less space for a high rise in chicago (with toilets and plumbing that work, i assume) than some cookie cutter complex in houston.

[glowrock]

Jeremy, you can get a place in my complex in Bakersfield! :) Hell of a lot bigger than your place, and really new! Hahaha

Aaron (Glowrock)

[JMancuso]

yeah, you got a pretty good deal there. bakersfield or not, it's still california.

[Ch.G, Ch.G]

Ah, the perennial insecurity of the Chicago cohort.

People willingly pay much higher rents here and there aren't a lot of vacancies. It's a fact. Perhaps farts smell better here. Perhaps it's the things I mentioned. Regardless, we aren't "empty" and you are oozing envy.

PS: I sometimes think I like YOUR city more than most of you do. Otherwise it's hard to figure why you are so touchy about it.

You really need to relax man...

[JDRCRASH]

I can't believe Miami isn't one of the top 3.

[brickell]

Why?

Our boom here may have been more noticeable because of all the condo towers, but it's nothing compared to the thousands of acres of suburban sprawl that was built in the Orlando's of the world.

We built plenty of it down here too, but just don't have the room that other cities have.

[rockyi]

It's intense pride my man, not insecurity.

Intense pride or insecurity, it doesn't really matter. It's just very annoying to people like me from downstate that have to hear from a small but very vocal minority of Chicagoans what a crap-hole we are compared to their city. It isn't necessary at all to compare Chicago to downstate (apples and oranges) or even other cities. We all know what a great city it is, the only drawback is the constant boasting, comparing or condescending remarks.
It still is my favorite city on earth and for the most part, Chicagoans are very friendly people but the loudmouths really turn me off on their city.

[BnaBreaker]

Intense pride or insecurity, it doesn't really matter. It's just very annoying to people like me from downstate that have to hear from a small but very vocal minority of Chicagoans what a crap-hole we are compared to their city. It isn't necessary at all to compare Chicago to downstate (apples and oranges) or even other cities. We all know what a great city it is, the only drawback is the constant boasting, comparing or condescending remarks.
It still is my favorite city on earth and for the most part, Chicagoans are very friendly people but the loudmouths really turn me off on their city.

Well there is a difference between being proud of your city and being a dick. I don't like when people, regardless of where they are from, talk about somewhere else in a snobbish, condescending manner. But can you blame a Chicagoan for gushing about their city when they get a chance? Those are in two completely different categories to me. I mean, come on, Chicago is pretty sexy. :tup:

[rockyi]

Yes, it's a very sexy city and as I said I love it but you have to admit that some Chicagoans can be complete dicks. Hell, for the first couple of years I was part of this site I never posted in the Mid-West forum at all because of the unsolicited remarks from a certain few Chicagoans about where I live. It just gets old.

[Mosha]

Intense pride or insecurity, it doesn't really matter. It's just very annoying to people like me from downstate that have to hear from a small but very vocal minority of Chicagoans what a crap-hole we are compared to their city. It isn't necessary at all to compare Chicago to downstate (apples and oranges) or even other cities. We all know what a great city it is, the only drawback is the constant boasting, comparing or condescending remarks.
It still is my favorite city on earth and for the most part, Chicagoans are very friendly people but the loudmouths really turn me off on their city.

It is all relative. Chicago is the target of a tremendous amount of undeserved animus and derision from the coasts and maybe that's why some of the pugnacity and pride rears its head. Some people I know regard it is another Omaha or the like. In college, students who were going onto graduate school at decent Chicago institutions such as UofC or Northwestern often quite vociferously dreaded the prospect of spending time in fly-over country. As I got older, colleagues of mine actually laughed with a touch of scorn and said they would not visit me (because of the awful food, weather, local "heifers" and so on) when I told them I would be spending a year or two in Chicago.

[BnaBreaker]

Yes, it's a very sexy city and as I said I love it but you have to admit that some Chicagoans can be complete dicks. Hell, for the first couple of years I was part of this site I never posted in the Mid-West forum at all because of the unsolicited remarks from a certain few Chicagoans about where I live. It just gets old.

I agree, but that's what I meant. Some people are just dicks. Others, are just very proud.

[JMancuso]

Yes, it's a very sexy city and as I said I love it but you have to admit that some Chicagoans can be complete dicks. Hell, for the first couple of years I was part of this site I never posted in the Mid-West forum at all because of the unsolicited remarks from a certain few Chicagoans about where I live. It just gets old.

at least chicagoans recognize there is a state attached to them. people from NYC think there are polars bears and canadians just outside westchester county and totally forget about upstate.

[Zerton]

I'm looking into a place at grant park, 2 bedroom and 1800 a month. Can't really find cheaper that size in the area.

[Strange Meat]

local "heifers"

I never knew east coast women in general to be particularly thin... Odd...

[rockyi]

I never knew east coast women in general to be particularly thin... Odd...

I always felt that people in the mid-west, south AND east coast were all pretty large. People out west seem to work a little harder at staying fit.

[rockyi]

I agree, but that's what I meant. Some people are just dicks. Others, are just very proud.

This subject reminds me of a time I was at O Hare airport and got bumped from a short return flight to the Quad Cities so I had to see the ticket agent to get reassigned. He asked me my final destination and I said "Moline/Quad Cities" He then rolls his eyes and says "Oh THAT sounds like an exciting place." I just shrugged my shoulders and without thinking said "Probably as exciting as being a ticket agent." The lady behind me said "Ha Ha Ha...good one!"
The doof was probably from Naperville. :haha:

[emathias]

It wasn't insecurity. It was a statement of economic fact. When the average rent of an entire market is being examined, it is what it is. There are metrics to argue it is over or underpriced (such as relationship to wage levels and so on) but those don't take into consideration the intangibles that likely cause the diversion from what would be expected. Lifestyle is one such intangible.
...


The intangibles drive the demand, but demand alone doesn't dictate price.

The demand for the Model T increased over time, while at the same time price dropped by 2/3rds in the first decade or so it was available.

Supply influences price, and increasing supply in both New York and San Francisco is actively discouraged. Transportation capabilities also influence price by effectively increasing supply. Part of the reason Manhattan and San Francisco cost a lot is they both have access constraints. Chicago on the other hand is relatively easy to build new housing in, and also has relatively good access to the core by all methods, effectively increasing housing stock for every part of the region. How much it costs to live somewhere isn't a terribly good indication of how great it is to live there, or even how popular of a place it is in real terms.

[ColDayMan]

This subject reminds me of a time I was at O Hare airport and got bumped from a short return flight to the Quad Cities so I had to see the ticket agent to get reassigned. He asked me my final destination and I said "Moline/Quad Cities" He then rolls his eyes and says "Oh THAT sounds like an exciting place." I just shrugged my shoulders and without thinking said "Probably as exciting as being a ticket agent." The lady behind me said "Ha Ha Ha...good one!"
The doof was probably from Naperville. :haha:

Well played. :banana:

[BnaBreaker]

This subject reminds me of a time I was at O Hare airport and got bumped from a short return flight to the Quad Cities so I had to see the ticket agent to get reassigned. He asked me my final destination and I said "Moline/Quad Cities" He then rolls his eyes and says "Oh THAT sounds like an exciting place." I just shrugged my shoulders and without thinking said "Probably as exciting as being a ticket agent." The lady behind me said "Ha Ha Ha...good one!"
The doof was probably from Naperville. :haha:

Hahaha! You're a reeeeeeeeeeeal pistol rock. :cheers:

[dktshb]

Interesting to see Chicago on that list especially with it being so cheap compared to LA, SF and NY.

[pip]

This subject reminds me of a time I was at O Hare airport and got bumped from a short return flight to the Quad Cities so I had to see the ticket agent to get reassigned. He asked me my final destination and I said "Moline/Quad Cities" He then rolls his eyes and says "Oh THAT sounds like an exciting place." I just shrugged my shoulders and without thinking said "Probably as exciting as being a ticket agent." The lady behind me said "Ha Ha Ha...good one!"
The doof was probably from Naperville. :haha:

oh cry me a river. Surely you must be able to differienciate between a few small comments and reality. I work part time in a deep dish pizza restaurant in downtown that is primarily a tourist place where the tourists think they are gettin' local. The most rude, racist, judgemental customers are from the South and your area - especially Michigan. Yes, I know Michigan and Ohio, etc. are different states but still all the same from my perspective and cheap too. But the difference is I don't hold everyone responsible from that area. You should come check out bar time in touristy River North area, makes Internet complaints seem trivial. Nothing like walking after work at 2am to have some urban Appalacian tourist yell in your face while I am walking to the bus. That area of Chicago sucks but now Lakeview, Lincoln Park, Northside areas are being invaded too.

[NYguy]

when tom said that he thought that san fran and new york were overpriced, it was clear to me that he was speaking for himself, as in he wouldn't want to pay the cost to live in those cities. he wasn't making some fact-based macro-level economic judgement of the two cities, just expressing his personal preference.

it's not hard to understand.

That's true. I think most people in and around New York acknowledge that they could live for less (much less in some cases) in other places, but there's a tradeoff. It's all relative.

[MayDay]

oh cry me a river. Surely you must be able to differienciate between a few small comments and reality. I work part time in a deep dish pizza restaurant in downtown that is primarily a tourist place where the tourists think they are gettin' local. The most rude, racist, judgemental customers are from the South and your area - especially Michigan. Yes, I know Michigan and Ohio, etc. are different states but still all the same from my perspective and cheap too. But the difference is I don't hold everyone responsible from that area. You should come check out bar time in touristy River North area, makes Internet complaints seem trivial. Nothing like walking after work at 2am to have some urban Appalacian tourist yell in your face while I am walking to the bus. That area of Chicago sucks but now Lakeview, Lincoln Park, Northside areas are being invaded too.


The Quad Cities are located in Iowa, not Ohio and certainly not near the Appalachian mountains. Fortunately I know not all pizza joint workers are provincial twits :dunce:

;)

[hudkina]

Boo hoo. The city of Chicago is being visited by tourists! Oh how terrible of them to spend their money in your city and allow you to have your job! They're so rude because they're from Michigan and Ohio and Appalachia!

[rockyi]

oh cry me a river.


Huh?
If you would have taken time to read my other posts you would have seen that I said I like Chicago and most people who live there but there are a small group of loud mouths who ruin it.


(I won't mention the fact that I don't like Chicago style pizza or I'll never heard the end of it)

[theWatusi]

No mention of Philadelphia on this list? I'm astonished. I thought we were the world capital of vacancy.

That's what I was thinking.

I guess vacant and abandoned are two different things. :frog:

[BnaBreaker]

Huh?


(I won't mention the fact that I don't like Chicago style pizza or I'll never heard the end of it)

Good thing parentheses drape your words in invisibility! :)

[ssiguy]

Is good to see Cleveland and Pittsburg aren't on the list. They have their problems but due to their dilligence of atleast trying to remake their respective cities has obviously helped. Development of mass transit, low-term planning as opposed to just building highrises praying to god that they sell, and trying to reshape their downtowns into something pedestrian friendly and not just building casinos, and realizing that their economy of yester year are long since over and building a service economy as opposed to just trying to ride out the storm have paid dividence.

[rockyi]

Good thing parentheses drape your words in invisibility! :)

Ah, yes! The magic of parenthesis. :tup:

[CGII]

The Quad Cities are located in Iowa, not Ohio and certainly not near the Appalachian mountains. Fortunately I know not all pizza joint workers are provincial twits :dunce:

;)

Heh, actually only one of the Quad Cities is in Iowa, the rest are in Illinois.

[hudkina]

Is good to see Cleveland and Pittsburg aren't on the list. They have their problems but due to their dilligence of atleast trying to remake their respective cities has obviously helped. Development of mass transit, low-term planning as opposed to just building highrises praying to god that they sell, and trying to reshape their downtowns into something pedestrian friendly and not just building casinos, and realizing that their economy of yester year are long since over and building a service economy as opposed to just trying to ride out the storm have paid dividence.

These numbers are for metropolitan populations, and have very little to do with downtowns. The reason the numbers for Cleveland and Pittsburgh are so low is because they have had an overall decline in population that has been going on for decades. In 2000, Metro Pittsburgh's population was more than 12% below its 1960 high, Metro Cleveland's population was more than 7% below its 1970 high. There isn't much demand for new housing in those shrinking metropolitan areas, so they didn't see the glut of new housing that sprung up in the sunbelt as well as the growing midwestern cities in the 90's and early 2000's.

On the other hand, Metro Detroit's population in 2000, was the highest it had ever been. People often forget, but Metro Detroit actually had a relatively healthy economy in the 90's. It added over 200,000 new residents in that decade vs. a gain of around 45,000 in Metro Cleveland and a loss of over 37,000 for Metro Pittsburgh. It recovered relatively quickly from the massive auto manufacturing job losses in the 70's and 80's. Even in the 2000's, Metro Detroit has grown. Though the Census Bureau estimates a loss between 2004 and 2007, Metro Detroit's estimated population for 2007 is still higher than the results from 2000. Metro Detroit's 2007 estimated population is about 1% above it's previous peak in 1970, while Metro Cleveland's 2007 estimated population is 10% below it's peak in 1970 and Metro Pittsburgh's 2007 estimated population is 15% below it's peak in 1960. In fact, for the first time ever, Metro Detroit is now larger than Metro Cleveland and Metro Pittsburgh combined.

So, :P

[urbanactivistTX]

I have to agree... this is a really dumb list. It sounds like they singled out markets may be overbuilt, and aren't paying any attention to other factors. It's just unfortunate bad press for these cities.

[Ayreonaut]

Heh, actually only one of the Quad Cities is in Iowa, the rest are in Illinois.

Unless you include Bettendorf, which is bigger than East Moline.

[Evergrey]

Bettendorf, Iowa is one of the Quad Cities

[Ayreonaut]

There's five main cities that make up the Quad Cities. Are Iowans/Illinoisans that bad at math?

[SuburbanNation]

The most rude, racist, judgemental customers are from the South and your area - especially Michigan. Yes, I know Michigan and Ohio, etc. are different states but still all the same from my perspective and cheap too. But the difference is I don't hold everyone responsible from that area.

a chicagoan that doesn't know the geography of their own state? WHAT? ;)

though it is weird when i discuss central illinois with a chicago, illinoisan out of our chicago office and get a blank stare. in fairness, i cover 75% of illinois due to the simple fact that st. louis isnt big enough to sustain our office, unlike chicagoland and its office...so i know "outstate" pretty well.

[OhGreatOne]

There's five main cities that make up the Quad Cities. Are Iowans/Illinoisans that bad at math?

Historically, the metro area referred to as the Quad Cities comprised Davenport, Rock Island, Moline and East Moline. Only in the past couple of decades or so has Bettendorf eclipsed East Moline in population, and concomitantly, in influence. Another example: the Triangle, historically referred to Raleigh, Durham and Chapel Hill. However, the town of Cary, now around 120,000, has eclipsed Chapel Hill (around 52,000). Although Cary does not have a major university (as Raleigh, Durham and Chapel Hill each have), its affluence, relative to the rest of the metro area, warrants consideration as a cornerstone of the region. Comments???

[hudkina]

There's five main cities that make up the Quad Cities. Are Iowans/Illinoisans that bad at math?

Apparently the area was originally called the "Tri-Cities" and included Davenport, Rock Island, and Moline. Eventually East Moline was included, and the name changed to "Quad Cities". After that Bettendorf came into its own, but the Quad Cities name had already been in such wide use that it stuck.

[left of center]

There's five main cities that make up the Quad Cities. Are Iowans/Illinoisans that bad at math?

not as bad as your dismal grasp of Latin ;)

[Capsule F]

No mention of Philadelphia on this list? I'm astonished. I thought we were the world capital of vacancy.

That is faaaaaaaaaar from the truth. Rentals and inhabited homes in Philly are filled very fast. If un-inhabitable houses were counted maybe, but why on earth would they ever count them?

[Ayreonaut]

not as bad as your dismal grasp of Latin ;)

Firefox didn't correct anything I wrote there.

[Atlantan26]

I have to agree... this is a really dumb list. It sounds like they singled out markets may be overbuilt, and aren't paying any attention to other factors. It's just unfortunate bad press for these cities.

very true, Atlanta is not "empty" its still filling up. we just happened to be in the middle of a big growth spurt when the market crashed so theres more inventory than necessary. ;)

[rockyi]

Here's your daily QUAD CITIES HISTORY LESSON....:)

We're called the Quad Cities due to a slight identity crisis. In the very early 1800's it was just Davenport, Iowa and Rock Island, Illinois and the area had the name Twin Cities (not original but the other Twin Cities were pretty small back then too). Then along comes a guy named John Deere who opened his plow factory in a small hamlet next to Rock Island called Moline. This caused the population of Moline to grow and for the next few dacades we were known as the Tri-Cities. Then along comes East Moline where all of the dirty factories and factory workers moved to because there was more room to grow and the name Quad Cities was attached. Then after WWII Bettendorf grew very quickly passing East Molines population and we started using the name Quint-Cities. By this time the locals said enough with the stupid name changes and the name Quad Cities stuck. So, even though East Moline is older, it's now actually Bettendorf that makes the fourth city. I believe we are the only bi-state metro area in the country that has a equal population in both states. if I'm wrong, let me know.
There are still a few local companies that use the name Tri-Cities in their company names and even fewer yet that still have Quint-Cities in their name. Apparently they didn't know the name wouldn't stick.

One night I was watching the Colbert Report and Stephen Colbert was talking about the area. He said "The Quad Cities are made up of Davenport and Bettendorf Iowa and Rock Island, Moline and East Moline, Illinois." there was then a long pause as he counted his fingers and said "Wait a minute....that doesn't make any sense.......Why would anybody name a town Bettendorf?"

We should just merge but I don't see that happening any time soon.

[Ayreonaut]

:haha: @ Colbert.

[initiald]

very true, Atlanta is not "empty" its still filling up. we just happened to be in the middle of a big growth spurt when the market crashed so theres more inventory than necessary. ;)

Charlotte and Greensboro are the same way. We've lost a lot of immigrant workers. Once some of the need for cheap labor and construction workers started drying up, part of our large Hispanic immigrant population moved elsewhere. I remember there was a front page article in the Charlotte Observer late last year with a photo of a long line at a Mexican bus company for workers who have decided to return to Mexico for the time being. (Which go me thinking... "travel through Mexico by bus? I should do this!")

I imagine Atlanta, with their high number of Hispanic construction workers, is experiencing the same thing.

[ChicagoChicago]

so are rents really cheap now in chicago? i was there last year and met a women who paid 1100 a month to live in some highrise on/ near lakeshore drive.
I don't know if they've come down lately, but they were still rising as of the fall.

[Abner]

There's no such thing as "over- (or under-) priced" for a market as a whole. The market sets the price levels.

I'm a little surprised nobody has corrected this statement. Of course housing markets can be "overpriced" in the sense of being inflated by a bubble rather than at an equilibrium justified by underlying fundamentals; it has been pretty obvious since at least 2003 that this has been the case for the nation as a whole and especially for certain submarkets. As Steely Dan pointed out, the context it was originally used in was obviously the colloquialism meaning "too expensive for me," but it's also the case that some housing markets can simply be too expensive. This is not to say that San Francisco is such a market any more than any other metropolitan area (although it probably was during the tech boom).

In fact, unless there are differences among cities that cause the "natural" rate of vacancy to differ substantially among them, the metro areas in this list are likely to be the most overpriced.

The reason this list isn't dominated by Rust Belt cities is probably because it is only counting housing that is actually on the market. Properties that have exited the housing market, whether abandoned buildings or vacant lots, are apparently not counted. Sort of like the difference between U3 and U6 unemployment.

[hudkina]

I figured out their source:

Rental Vacancies (http://www.census.gov/hhes/www/housing/hvs/annual07/ann07t5.html)

Homeowner Vacancies (http://www.census.gov/hhes/www/housing/hvs/annual07/ann07t6.html)



I looked up the numbers for 2007 using data from the American Community Survey, and it's not even close to the numbers in those two reports. This is how they ranked using the ACS data:

Using their method: (rental-vacancy/home-vacancy)
1. Atlanta, GA - (14.0%/4.6%)
2. Columbus, OH - (15.2%/4.0%)
3. Indianapolis, IN - (13.7%/4.1%)
4. Detroit, MI - (12.5%/4.4%)
5. Jacksonville, FL - (12.5%/4.1%)
6. Cincinnati, OH (tied) - (14.1%/3.6%)
6. Houston, TX (tied) - (14.2%/3.5%)
8. McAllen, TX - (14.2%/3.4%)
9. Phoenix, AZ - (11.5%/4.6%)
10. Dallas, TX - (13.3%/3.6%)
11. Sarasota, FL - (10.9%/5.1%)
12. Cleveland, OH - (12.4%/3.7%)
13. Memphis, TN - (13.4%/3.4%)
14. Akron, OH - (11.7%/3.7%)
15. Las Vegas, NV (10.3%/6.0%)

If you rank them just on the total rental/home vacancy rate:

1. Columbus, OH - 8.1%
2. Las Vegas, NV - 7.8%
3. Atlanta, GA - 7.7%
4. Houston, TX - 7.7%
5. Dallas, TX - 7.4%
6. Indianapolis, IN - 7.2%
7. Memphis, TN - 7.1%
8. Cincinnati, OH - 7.1%
9. Jacksonville, FL - 6.9%
10. McAllen, TX - 6.9%
11. Phoenix, AZ - 6.8%
12. Orlando, FL - 6.8%
13. Sarasota, FL - 6.6%
14. Detroit, MI - 6.6%
15. Cleveland, OH - 6.6%

BTW, the lowest are:

1. Oxnard, CA - 2.5%
2. San Jose, CA - 2.9%
3. Los Angeles, CA - 3.1%
4. Springfield, MA - 3.3%
5. Allentown, PA - 3.4%
6. Honolulu, HI - 3.4%
7. Salt Lake City, UT - 3.6%
8. Hartford, CT - 3.7%
9. Boston, MA - 3.8%
10. Milwaukee, WI - 3.8%
11. Bridgeport, CT - 3.9%
12. Seattle, WA - 3.9%
13. Albany, NY - 3.9%
14. Minneapolis, MN - 3.9%
15. Albuquerque, NM - 3.9%

[urbanactivistTX]

^Is it just me, or do the total vacancies seem kind of normal? Is 8% or even 9% that high for a large metro?

[brian_b]

I don't know if they've come down lately, but they were still rising as of the fall.

It depends on how you are measuring rents. The dedicated apartment towers in the Loop area are not lowering asking rents; some are still increasing them. They are, however, offering deals to people that ask (based on conversations with people that have recently signed leases). The shadow market - condos offered for rent by their owners - has seen significant drops in asking rents. On the other hand, these asking rents have been pretty ridiculous in the past.

I am expecting to sign a lease in the Loop around April or May at $2.15-$2.30 per sq ft, which is pretty much in line with what I'm paying right now. Most places are asking much higher than this, but they will come down. Supply is growing way too rapidly.

[brian_b]

Interesting to see Chicago on that list especially with it being so cheap compared to LA, SF and NY.

It's cheaper because it's so much easier to get approval to build large buildings. Because it's so easy to get approval to build large buildings developers built a lot of them.

It's very hard for demand to outstrip supply. It's very easy for supply to outstrip demand.


Also, looks can be deceiving. If you build a high-rise building with 400 condos in it and only sell half of them, you're still going to see a lot of activity - you still have 500-800 residents going in and out of the same lobby, getting coffee at the same little cafe, etc. If you build a large suburban subdivision of 400 homes and only sell half of them the place is going to look very depressing and pretty deserted. Perception is everything.

[Gordo]

It's cheaper because it's so much easier to get approval to build large buildings. Because it's so easy to get approval to build large buildings developers built a lot of them.

It's very hard for demand to outstrip supply. It's very easy for supply to outstrip demand.

A little simplistic, to say the least. Chicago also has miles and miles and miles of flat land radiating out from it, which has kept suburban prices low. Lower suburban prices = lower city prices. This is especially true in areas with good transportation into the central city - Chicago has an excellent commuter rail system and a relatively low-traffic freeway system (compared to NY, LA, and SF) because of very few geographic barriers which force development and freeways into certain areas. The ability to build large residential buildings easier has had a negligible impact, because what percentage of Chicago (and Chicagoland as a whole) lives in large buildings? (I'd be interested to see the numbers of large buildings built in Chicago versus the other three over the past several decades, if anyone has something like that)

The relative lack of NIMBYs and faster approval times has helped some, but the natural (geographic features) and historic (good rail) cost advantages to Chicago are pretty huge.

[Derek2k32]

I figured out their source:

Rental Vacancies (http://www.census.gov/hhes/www/housing/hvs/annual07/ann07t5.html)

Homeowner Vacancies (http://www.census.gov/hhes/www/housing/hvs/annual07/ann07t6.html)



I looked up the numbers for 2007 using data from the American Community Survey, and it's not even close to the numbers in those two reports. This is how they ranked using the ACS data:

Using their method: (rental-vacancy/home-vacancy)
1. Atlanta, GA - (14.0%/4.6%)
2. Columbus, OH - (15.2%/4.0%)
3. Indianapolis, IN - (13.7%/4.1%)
4. Detroit, MI - (12.5%/4.4%)
5. Jacksonville, FL - (12.5%/4.1%)
6. Cincinnati, OH (tied) - (14.1%/3.6%)
6. Houston, TX (tied) - (14.2%/3.5%)
8. McAllen, TX - (14.2%/3.4%)
9. Phoenix, AZ - (11.5%/4.6%)
10. Dallas, TX - (13.3%/3.6%)
11. Sarasota, FL - (10.9%/5.1%)
12. Cleveland, OH - (12.4%/3.7%)
13. Memphis, TN - (13.4%/3.4%)
14. Akron, OH - (11.7%/3.7%)
15. Las Vegas, NV (10.3%/6.0%)

If you rank them just on the total rental/home vacancy rate:

1. Columbus, OH - 8.1%
2. Las Vegas, NV - 7.8%
3. Atlanta, GA - 7.7%
4. Houston, TX - 7.7%
5. Dallas, TX - 7.4%
6. Indianapolis, IN - 7.2%
7. Memphis, TN - 7.1%
8. Cincinnati, OH - 7.1%
9. Jacksonville, FL - 6.9%
10. McAllen, TX - 6.9%
11. Phoenix, AZ - 6.8%
12. Orlando, FL - 6.8%
13. Sarasota, FL - 6.6%
14. Detroit, MI - 6.6%
15. Cleveland, OH - 6.6%

BTW, the lowest are:

1. Oxnard, CA - 2.5%
2. San Jose, CA - 2.9%
3. Los Angeles, CA - 3.1%
4. Springfield, MA - 3.3%
5. Allentown, PA - 3.4%
6. Honolulu, HI - 3.4%
7. Salt Lake City, UT - 3.6%
8. Hartford, CT - 3.7%
9. Boston, MA - 3.8%
10. Milwaukee, WI - 3.8%
11. Bridgeport, CT - 3.9%
12. Seattle, WA - 3.9%
13. Albany, NY - 3.9%
14. Minneapolis, MN - 3.9%
15. Albuquerque, NM - 3.9%


New York had a 2.88% rental vacancy rate in 2008.

http://nyc.gov/portal/site/nycgov/menuitem.c0935b9a57bb4ef3daf2f1c701c789a0/index.jsp?pageID=mayor_press_release&catID=1194&doc_name=http%3A%2F%2Fnyc.gov%2Fhtml%2Fom%2Fhtml%2F2009a%2Fpr071-09.html&cc=unused1978&rc=1194&ndi=1


...The 2008 survey, which reveals a synopsis of the City’s housing market between February and June 2008, found that the citywide net rental vacancy rate was 2.88 percent, down from 3.09 percent in 2005. The City’s total housing stock rose to more than 3.33 million units – the largest in the 43-year period since the first survey was conducted in 1965 – and all five boroughs saw an increase in housing. New Yorkers’ satisfaction with their neighborhoods and overall building conditions reached their highest ever levels since they were first measured, 30 years ago and 43 years ago, respectively. The survey, conducted every three years, is required by State and City rent-regulation laws to determine New York City’s overall vacancy rate for rental housing. A rental vacancy rate below five percent triggers the declaration of a “housing emergency,” which is necessary for the continuation of rent regulation protections for New York City residents. Every survey since the first one in 1965 has found the rental vacancy rate to be below five percent....

[hudkina]

That data is for metropolitan areas, not cities...

[PremierAtlanta]

I figured out their source:

Rental Vacancies (http://www.census.gov/hhes/www/housing/hvs/annual07/ann07t5.html)

Homeowner Vacancies (http://www.census.gov/hhes/www/housing/hvs/annual07/ann07t6.html)



I looked up the numbers for 2007 using data from the American Community Survey, and it's not even close to the numbers in those two reports. This is how they ranked using the ACS data:

Using their method: (rental-vacancy/home-vacancy)
1. Atlanta, GA - (14.0%/4.6%)
2. Columbus, OH - (15.2%/4.0%)
3. Indianapolis, IN - (13.7%/4.1%)
4. Detroit, MI - (12.5%/4.4%)
5. Jacksonville, FL - (12.5%/4.1%)
6. Cincinnati, OH (tied) - (14.1%/3.6%)
6. Houston, TX (tied) - (14.2%/3.5%)
8. McAllen, TX - (14.2%/3.4%)
9. Phoenix, AZ - (11.5%/4.6%)
10. Dallas, TX - (13.3%/3.6%)
11. Sarasota, FL - (10.9%/5.1%)
12. Cleveland, OH - (12.4%/3.7%)
13. Memphis, TN - (13.4%/3.4%)
14. Akron, OH - (11.7%/3.7%)
15. Las Vegas, NV (10.3%/6.0%)

If you rank them just on the total rental/home vacancy rate:

1. Columbus, OH - 8.1%
2. Las Vegas, NV - 7.8%
3. Atlanta, GA - 7.7%
4. Houston, TX - 7.7%
5. Dallas, TX - 7.4%
6. Indianapolis, IN - 7.2%
7. Memphis, TN - 7.1%
8. Cincinnati, OH - 7.1%
9. Jacksonville, FL - 6.9%
10. McAllen, TX - 6.9%
11. Phoenix, AZ - 6.8%
12. Orlando, FL - 6.8%
13. Sarasota, FL - 6.6%
14. Detroit, MI - 6.6%
15. Cleveland, OH - 6.6%

BTW, the lowest are:

1. Oxnard, CA - 2.5%
2. San Jose, CA - 2.9%
3. Los Angeles, CA - 3.1%
4. Springfield, MA - 3.3%
5. Allentown, PA - 3.4%
6. Honolulu, HI - 3.4%
7. Salt Lake City, UT - 3.6%
8. Hartford, CT - 3.7%
9. Boston, MA - 3.8%
10. Milwaukee, WI - 3.8%
11. Bridgeport, CT - 3.9%
12. Seattle, WA - 3.9%
13. Albany, NY - 3.9%
14. Minneapolis, MN - 3.9%
15. Albuquerque, NM - 3.9%


The heading of the Forbes article can be quite decieving.

I can't speak for every city on the list but I will take the stats provided by Hudkina above and I will speak for cities like Atlanta, Dallas, Houston, Las Vegas and Phoenix. Using the data above, one would think that these cities are being abandoned because of the high vacancy rates...yet most are among the top five fastest growing large metropolitan areas using last year's census data. Both the Atlanta and Dallas metropolitan areas grew by 150,000 last year alone.

So what causes the high vacancy rates. It's not that the cities are empty, it's that builders didn't know when to stop. I the last few years, I have seen highrise condo buildings and 1000 home subdivisions appear out of nowhere. Noone had planned on the economy coming to an almost complete halt. As the economy slowed and the building remained the same, vacancies increased.

Right now, these cities I listed above have way more inventory than is necessary. These aren't dilapitated apartment buildings, ancient condo towers and forgotten subdivisions that are causing the high vacancies. It's these newly built, without reason, complexes that are driving up the vacancy rate.

When I read the article for some of the choice cities, all I see is a buying opportunity. We will buy as many one/two bedroom condos as possible; in as many condo towers in Downtown/Midtown/Buckhead (in Atlanta) as possible. We can hold on to them and rent out the ones we can. As soon as the next wave comes along after 2011, we will be sitting pretty. We can increase rents or sell off some. There is no way I could not bank on a city like Atlanta, Dallas or Houston....the fundamentals are just too great.

To lump all these cities together and proclaim them all empty is a half truth. Let me be the first to say that Atlanta is alot more crowded than it used to be so if it is empty then empty is the new "Half Full."

[hudkina]

None of the numbers necessarily represent dilapidated buildings. These are numbers for vacant housing units that are currently for rent or for sale (or that have been rented or sold but currently sit empty.) So your asterisk next to the sunbelt cities isn't necessary. Lots of cities went on a building boom in the late 90's and early 00's only to see the market drop in the last few years.

Forbes is notorious for taking statistics, using them in a way that is counter-intuitive, and ranking them so as to make some cities seem to be in a special predicament while others are perfectly fine. If you look, at the #1 metro and the #75 metro, there really isn't that big of a difference between vacancy rates. The lowest is 3% the highest is 8%. That isn't that big of a difference in the grand scheme of things.

[PremierAtlanta]

None of the numbers necessarily represent dilapidated buildings. These are numbers for vacant housing units that are currently for rent or for sale (or that have been rented or sold but currently sit empty.) So your asterisk next to the sunbelt cities isn't necessary. Lots of cities went on a building boom in the late 90's and early 00's only to see the market drop in the last few years.

Forbes is notorious for taking statistics, using them in a way that is counter-intuitive, and ranking them so as to make some cities seem to be in a special predicament while others are perfectly fine. If you look, at the #1 metro and the #75 metro, there really isn't that big of a difference between vacancy rates. The lowest is 3% the highest is 8%. That isn't that big of a difference in the grand scheme of things.


I was speaking only of the cities I know...if they happen to only be sunbelt then so be it...but I hate speaking of cities I know little about. I would like to also add that that point was referenced in my initial posting so an aestrick is IN FACT NECESSARY and my thoughts will remain as they were intially stated. If you have first hand data for cities you are most familiar with then you can also add your post regarding those. We live in Atlanta and my husband does business in all the cities I listed so I have first hand account for which I speak.

Also the difference is necessary because every metro is not growing by 100,000+ like the five metros I listed. That is a fact. Every metro listed is not the same and there are some differences...although my posting was not to compare the differences. Some of the metros may in fact be empting out...others are not. To lump them all together like that and to take a number and say "hey mindless people...these cities are empty" is disingeneous at best.

[hudkina]

But my point is that they are ranking the same thing: over-built housing (often on the fringe of the metro area) that currently sits empty due to the crash of the housing market. While it is especially hard-hitting in the sunbelt, it's not the only region where this is happening.

[PremierAtlanta]

But my point is that they are ranking the same thing: over-built housing (often on the fringe of the metro area) that currently sits empty due to the crash of the housing market. While it is especially hard-hitting in the sunbelt, it's not the only region where this is happening.

You are only proving my point as to the confusion this article causes. You are correct in that it's not a sunbelt only occurance. My whole point was that clearly housing development was greater in the southern and western region. We can clearly collect data. Metropolitan Atlanta and Metropolitan Detriot have similar population stats...yet between 2000-2008 I am sure housing premits inssued were far greater in the Atlanta area. Why? Because population growth was greater. Unfortunately developers built for people who had not yet moved to either metro. Yes, they built in both metros but I'm sure the numbers were greater in one than the other...although both metros have a high vacancy rate.

Not to single Detriot out...it get's more than it's fair share of bad press...why, I don't know...so my statement is not to add to it...but if I had to hedge my bets I would hedge them on cities that continue to draw people in. Atlanta, Dallas and Houston (I always list cities alphabetically and not by preference) are metros that are still growing. So my thought would be...if I am buying 100 One Bedroom Condos in the city, near public transportation, which cities would I do that in...mind you, I am trying to make some profit while the economy is still grim.

That's right...the growing metros...and right now that happens to be some of the sunbelt metros. After reading articles about Phoenix, I am starting to look at them with greater scrutiny.

If:

metro A has a rental vacancy rate of 13% and is growing by 17% and
metro B has a rental vacancy rate of 12.68% and is growing by .05%,

Which one is a better bet? This whole article is not based on specifics. It's just throwing out numbers and hoping they will stick. The average person is not going to know the growth rates of most metros or cities...although the internet has that information readily available. Sometimes Forbes has cute list that you can somewhat see how they derived their rankings. This list has so many holes...and that is for every city on the list. It doesn't paint an accurate picture of any of those metro. Also, it doesn't make a difference between a city that is potentially losing population thereby increasing vacant housing stock and one that is gaining in population but had a hyper building season between 2000-2008.

The list also doesn't take into consideration the fact that some of the sunbelt cities lost the illegal population. This was big rentals for many "lesser" apartment complexes throughout many regions. Once these populations moved on, it left a void and lots of vacancies.

[Abner]

When I read the article for some of the choice cities, all I see is a buying opportunity. We will buy as many one/two bedroom condos as possible; in as many condo towers in Downtown/Midtown/Buckhead (in Atlanta) as possible. We can hold on to them and rent out the ones we can. As soon as the next wave comes along after 2011, we will be sitting pretty. We can increase rents or sell off some. There is no way I could not bank on a city like Atlanta, Dallas or Houston....the fundamentals are just too great.


So you disagree with the housing economists who argue that housing prices have never appreciated in the long term except during this bubble and that prices in the most inflated markets, i.e. the Sunbelt, still need to fall 30-40% to bring them in line with fundamentals? I don't mean to be too pointed, just curious about the source of your optimism.

[hudkina]

I don't even know what you mean when you say "better bet"... In what regards? Someone isn't going to choose to live in one city over another due to vacancy rates. Both Atlanta and Detroit have the vacancy rates that they do, simply because they overbuilt their housing markets. This isn't ranking anything other than that. Any supposed underlying meaning can be attributed to your own thoughts and feelings on the cities. Atlanta isn't the worst metro in the country, simply because it has the highest rate of vacancies. It just has the highest rate of vacancies because the market crash took developers by surprise. Eventually, new housing construction will fall in line with the change in the population growth rate. But keep in mind, that all cities are going to have a certain amount of vacant housing. It would be bad for any market if there wasn't any vacancies.

[PremierAtlanta]

I don't even know what you mean when you say "better bet"... In what regards? Someone isn't going to choose to live in one city over another due to vacancy rates. Both Atlanta and Detroit have the vacancy rates that they do, simply because they overbuilt their housing markets. This isn't ranking anything other than that. Any supposed underlying meaning can be attributed to your own thoughts and feelings on the cities. Atlanta isn't the worst metro in the country, simply because it has the highest rate of vacancies. It just has the highest rate of vacancies because the market crash took developers by surprise. Eventually, new housing construction will fall in line with the change in the population growth rate. But keep in mind, that all cities are going to have a certain amount of vacant housing. It would be bad for any market if there wasn't any vacancies.

Oy Vey!!!!!!!!!!

In more than one of my post I have typed "if we bought 100 1 bedroom condos...yadda yadda yadda" then chances are "Better bet" must mean financial. Why else would we buy 100 condos? People with jobs need a place to live. People moving from other cities may want to lease before they purchase. It's a better bet to make such a financial decision on places that people are moving to. That's as simple as I can explain "better bet." If there were hundreds of vacant 1 bedroom condos that we can purchase for 100k a piece and 100,000+ people are moving to that metro for the last two years (I doubt anyone will post those numbers for 2008) then that will be a better bet...I don't care if that city is Zidah Zee, North Dakota...we will buy them as a strategic financial move.

You are not talking to someone with just a bachelors from some two bit college. I fully understand the premises for the article but it is flawed. I guess in today's environment people want news bits quick fast and in a hurry...without any substantiative information. Each and every one of these metros are different and the reason behind the vacancies vary just as much. I am not worried that people are going to stop moving to Atlanta or any other metro ranked high on the list because of vacancies. If my metro or the metros I listed were shedding jobs left and right then perhaps I would be concerned. Noone is going to move to a city where they can't work...plain and simple.

I am not defending these metros but rather I am saying the article is flawed...and that goes for their labelling of Detriot as an empty city as well. Focus on showing those of us who have not yet had the pleasure of visiting Detriot how this is true in your case. I have never been, although I have an acquaintance from there...so I can only speak of what I know. I will leave what I think to my own personal blogs and talk shows.

[PremierAtlanta]

So you disagree with the housing economists who argue that housing prices have never appreciated in the long term except during this bubble and that prices in the most inflated markets, i.e. the Sunbelt, still need to fall 30-40% to bring them in line with fundamentals? I don't mean to be too pointed, just curious about the source of your optimism.

The article is not talking about anything you just mentioned. I am not adding too or subtracting from the article. I am merely stating that the article's information is flawed because it does not delve into each unique metro's reasoning for having their particular rental/housing vacancy rates.

The question you just asked me and my supposed disagreement with housing economist could not have possibly been gleaned from what I posted. At all......in fact, if I must speak on the three metros I know the most...Atlanta, Dallas and Houston, none of those metros had high price appreciation in this last housing bubble. In fact all three metros STILL have some of the lowest average housing prices of the 25 largest metros in this country.

I'm curious as to how you assertained that I was insinuating that the hosuing bubble in SOME sunbelt cities were not troublesome? I made no mention of that...so discuss what I posted.

[Abner]

The article is not talking about anything you just mentioned. I am not adding too or subtracting from the article. I am merely stating that the article's information is flawed because it does not delve into each unique metro's reasoning for having their particular rental/housing vacancy rates.

The question you just asked me and my supposed disagreement with housing economist could not have possibly been gleaned from what I posted. At all......in fact, if I must speak on the three metros I know the most...Atlanta, Dallas and Houston, none of those metros had high price appreciation in this last housing bubble. In fact all three metros STILL have some of the lowest average housing prices of the 25 largest metros in this country.

I'm curious as to how you assertained that I was insinuating that the hosuing bubble in SOME sunbelt cities were not troublesome? I made no mention of that...so discuss what I posted.

Sure, prices never rose as much--on average, at least--in Atlanta, Houston, and Dallas as they did in Phoenix, Miami, and Las Vegas, but they still rose at a moderate pace (at least in Atlanta), they peaked later than prices in the most inflated cities, and they have been falling since then. Moreover, as you said, the supply absolutely exploded; theoretically a huge increase in supply with nearly constant prices can be characteristic of a bubble as well. I legitimately don't know whether economic activity in those cities warrants the huge growth in housing supply they experienced. I also don't know whether migration to those cities will slow, or prices will fall, due to the damage done to household balance sheets among potential migrants. I do know that Atlanta is having an especially hard time with foreclosures, although I haven't seen enough to know if that is contained to low-income households (which I gather you're not talking about buying). And I know that economic fortunes in Houston are tied rather closely to energy prices. Perhaps you have good reason to be confident that prices in will continue to rise in those cities and the excess supply will be mopped up without prices having to fall, and I (and others I'm sure) would be interested to know why you think so.

[hudkina]

I'm just curious who's going to buy 100 condos in Atlanta or North Dakota? Are you saying that Atlanta is the better bet for "flipping" houses or for seeing the value increase over time? Sure, I'll agree with that (to an extent), but what does that have to do with the vacancy rates?

[PremierAtlanta]

I'm just curious who's going to buy 100 condos in Atlanta or North Dakota? Are you saying that Atlanta is the better bet for "flipping" houses or for seeing the value increase over time? Sure, I'll agree with that (to an extent), but what does that have to do with the vacancy rates?

I like your first sentence...my husband asked the same question...lol. I should have said 50...and made the disclaimer that they would be either distress or foreclousure purchases.

We don't buy real estate to "flip" it. My husband will be the first to tell you, I don't like a whole bunch of confusion. If it can't be made plain for me, I don't want to deal with it. Flipping takes a strong stomach and a constant finger out for the changing winds...and that was in the good times. As we would do with any company stock or a business, we purchase for the longhaul with hopes of making a sound investment.

I can see an investment oppurtunity even in bad times. What does this has to do with vacancy rates???...listen up grasshopper...there will be developers and sellers trying to unload properties that they can no longer afford nor rent. In their world they (the developers) need to clear their books or they (sellers) will have to sell because they bought high and must charge rents enough to cover mortgage, HOA fees and property taxes. Their misfortune can be my gain. In good times they could have asked $225k for a one bedroom condo in Midtown Atlanta. Now, to save face, due to their inability to sell said units, they will almost take what they can just to break even.

How do I know this? A few weeks ago my husband and I had a private meeting with a developer here in Atlanta. We were considering purchasing in a highrise under construction. When we gave our specifications of what we were looking for and said that unfortunately the size of their units were a bit too small. They jumped through hoops to keep us from walking out. They suggested to us to combine two seperate units...and this would have saved us hundreds of thousands of dollars. Developers are slashing prices...you have the cash, they will slash!

This can be an investors cake walk...that's what this has to do with vacancy rates. Some of these cities are prime locations for population growth. I personally do not feel that this grim economy will last forever. You have to do your homework and understand your market dynamics. Every city is not a good buy and some a greater than others. This has nothing to do with a like or dislike of a city. It has to do with turning a negative into a positive. This is a buyers bonanza. Some of us personally remember or are decendents of those who remember when one could not give away properties in some lower Manhattan locations...and to some degree on streets in the 40's-50's. I remember the stories told to me by my grandfather of buyers who went through and bought up buildings in the late 60's and 70's and held on to them. NYC had great fundamentals so it made sense.

The Reichmann family comes readily to mind....I could go on and on but it's late and I'm long winded enough.

[PremierAtlanta]

Sure, prices never rose as much--on average, at least--in Atlanta, Houston, and Dallas as they did in Phoenix, Miami, and Las Vegas, but they still rose at a moderate pace (at least in Atlanta), they peaked later than prices in the most inflated cities, and they have been falling since then. Moreover, as you said, the supply absolutely exploded; theoretically a huge increase in supply with nearly constant prices can be characteristic of a bubble as well. I legitimately don't know whether economic activity in those cities warrants the huge growth in housing supply they experienced. I also don't know whether migration to those cities will slow, or prices will fall, due to the damage done to household balance sheets among potential migrants. I do know that Atlanta is having an especially hard time with foreclosures, although I haven't seen enough to know if that is contained to low-income households (which I gather you're not talking about buying). And I know that economic fortunes in Houston are tied rather closely to energy prices. Perhaps you have good reason to be confident that prices in will continue to rise in those cities and the excess supply will be mopped up without prices having to fall, and I (and others I'm sure) would be interested to know why you think so.

Okay...excellent post...I will respond when I return later today. It's 1am here and I want to give this my full attention. You ask some great questions. This is what I was referencing that should have been explored by the author of the article.

[hudkina]

Uh... Again what does you wanting to rank which cities you think are the "best bet" for buying investment properites have to do with a simple ranking of housing vacancies? This list is benign. It's not meant for anything but to draw people to Forbes.com so they can generate ad revenue. That's all it is meant for.

[PremierAtlanta]

Uh... Again what does you wanting to rank which cities you think are the "best bet" for buying investment properites have to do with a simple ranking of housing vacancies? This list is benign. It's not meant for anything but to draw people to Forbes.com so they can generate ad revenue. That's all it is meant for.


You are quite entertaining....

I made a post and I posted my thoughts. I have a right to say what I choose to within reason. You asked me a question regarding what I meant as a better bet and I answered. Don't know get into a hissy because I answered the question you asked. It per se has nothing to do with the Forbes article but last I checked....yeap, I'm still in the same country...this is the U.S.A and I can type my opinion. If you have an issue with me stating how vacancies can be a good thing if leverage well then you have several options.

A) Don't answer my post. I mentioned cities I was familiar with and you responded about sunbelt cities.

B) Respond to my post but accept my responses....even if they don't align with everything you believe.

C) Respond to my post and get into a huff because I only mentioned cities I am familiar with.

D) Don't respond at all and save yourself and me the time.

You can choice either option because I don't care. I have a right to say what I want to say and I will say it. I made my post and I can easily back it up with data. You challenged me and I responded...although it's interesting that you only questioned me about my "better bet" statement and not the fact that metro Atlanta...and some of the sunbelt metros I listed...had greater housing premits issued 2000-2008 than metro Detriot...nor did you challenge me on the fact that many of these metros that I felt were a better bet are gaining 100,000+ new citizens yearly?

Like you can pick out an article that may not be flattering to Detriot and give countless post on those...can I not do the same...wait, why on Earth would I need your permission to do so? I can do as I choose and if you don't like it then that is tough...I am sure you will get over it...and if you don't, that is your tragedy, not mine.

[PremierAtlanta]

Sure, prices never rose as much--on average, at least--in Atlanta, Houston, and Dallas as they did in Phoenix, Miami, and Las Vegas, but they still rose at a moderate pace (at least in Atlanta), they peaked later than prices in the most inflated cities, and they have been falling since then. Moreover, as you said, the supply absolutely exploded; theoretically a huge increase in supply with nearly constant prices can be characteristic of a bubble as well. I legitimately don't know whether economic activity in those cities warrants the huge growth in housing supply they experienced. I also don't know whether migration to those cities will slow, or prices will fall, due to the damage done to household balance sheets among potential migrants. I do know that Atlanta is having an especially hard time with foreclosures, although I haven't seen enough to know if that is contained to low-income households (which I gather you're not talking about buying). And I know that economic fortunes in Houston are tied rather closely to energy prices. Perhaps you have good reason to be confident that prices in will continue to rise in those cities and the excess supply will be mopped up without prices having to fall, and I (and others I'm sure) would be interested to know why you think so.

If I evaluate the Atlanta market, I must agree that there will be price constrictions in the Atlanta metro area for a few years. In my post where I mentioned purchasing units, I didn't mean to give off the impression that I was saying it for profit within 5 years. I'm always a long termer so I do feel bullish that some of the larger sunbelt metros (Atlanta, Charlotte, Dallas and Houston) will be great buys long term. Near term however I see no occassion for great price appreciations.

Much of the surplus in some of these large sunbelt metros are due to foreclosures, the speculative market and overzealous builders. With these metros having little to no geographical restrictions, there seem to have been a slash, burn and build mentally. You build it and they will come. For many years there were thousands of people moving to these metros weekly and they needed a place to live. Because of the endless acres of land in which to build, house prices could be kept low. Between 2000-2008, metro Atlanta prices may have gone up steadily about 7%. It was nothing like even Jacksonville, Florida experienced.

My confidence has little to do with the prices of the units been considerably higher than we may purchase them for...but I do know this...if we time the bottom correctly or buy at a fire sell rate, they will at least stabilized and increase somewhat. That's why we are looking at units for rental purposes. We are bullish that the metros I listed will continue to have an influx of new arrivals and these new arrivals will need a place to live. Some will rent and some will purchase. If....and this is a hard to control variable...builders do not reopen the floodgates, inventory should be absorbed in the next five years. After that, I would hope that local municipalities learn from this real estate fiasco and become more selective on approved development.

Prices will fall...and quite honestly...they should to get more in line with what the average American can afford.