27.6.11

MARKETS ALLOCATE RESOURCES.  David Freddoso looks on the bright side of the popping housing bubble.
The bear market in housing is a great equalizer that promises to undo the inequalities government cannot and will not ever fix. It is creating opportunities for lower-income families, who are now well within reach of enjoying a devalued but still inherently valuable and enjoyable asset -- big houses with big yards.

This is one reason among many why government efforts to re-inflate the housing bubble and prop prices up are so deeply misguided. For all the criticism of laissez faire and its alleged lack of concern for the poor, the invisible hand of the market does at times reach out to the poor and help them at the expense of the well-to-do. We are seeing this right now. It would be a shame if government stepped interfered with some kind of misguided "housing policy."
It's a different world, indeed, when a Section 8 voucher holder is able to be picky.
If [Liza Jackson] was cramped in Honolulu, here she had higher standards. At least three bedrooms. Hardwood floors, preferably. An open kitchen.

They wound their way to the first address, which turned out to be the sort of Section 8 offering typical of the boom years: a small, 1970s-era brick number with dirt patches in the front yard.

“I’ll put ‘[Heck] no’ next to this one,” Jackson said, making a note.

She hit the gas, passing two young men in shorts and tank tops.

“Uh-oh, street punks,” Jackson said, further disqualifying the area.
That's not to say all is well, however. In Chicago's Chatham neighborhood, falling housing prices induce "there goes the neighborhood" reactions among the current residents.
Back in the day, the higher rents and home prices pretty much kept the riff-raff out. But home values in Chatham have plummeted. In 1990, the median value of a home in Chatham was $99,794. During the housing boom — from 2000 to 2009 — that rose to $182,727. By this year, though, it had sunk to just $69,750, according to the Chicago Association of Realtors.

When that happens, “The land becomes affordable by a group of folks who couldn’t have afforded it 10 or 15 years earlier,” says William A. Sampson, a sociologist at DePaul University who’s an expert on the black middle class.

Thumbing through all the news stories about shootings, stabbings, babies getting killed and other crimes, I’m shocked that so many of the perpetrators, as well as the victims, have addresses in Chatham.

This is exactly what a previous generation feared.

Twenty-five years ago, the Chicago Sun-Times ran a series called “The Chatham Story.” In one of those stories, a retired factory worker talked about the future he saw then for Chatham.

“They are coming from the ghetto,” he said. “From down in the slums. And they are not the type of people I like to live with. They don’t care about the neighborhood.”

Today, longtime Chathamites seem more convinced than ever, from what I kept hearing, that poor people moving in from somewhere else are the ones causing most of the problems. Sampson understands that fear.

“Middle-income black folks don’t want poor black people living around them,” he says. “They say, ‘Look, I’ve worked my tail off for all these years to get away from that. Now, you are going to put them down the street.’ ”
The habits of the middle class matter still.
Maryellen Drake’s parents moved to Chatham in 1957. She was born and raised there. For 20 years, she’s served as vice president of the Chatham Avalon Park Community Council, which has been tackling important community issues for 50 years.

Today, Drake looks around, and what she sees disgusts her.

“This is a class issue,” she says of Chatham’s troubles. “It’s not just about income. It’s about the standards that you are accustomed to . . . Barbecue grills on the front lawn. Ten and 12 people piled up on the front porch. Opening fire hydrants instead of going in the backyard and getting in the pool or under a hose.

“I can’t say they are Section 8. Can’t say they are from the projects. But I know that — by the way they behave — although they look like me, we are very different.”

Some longtime residents figure it’s up to them to teach the new arrivals the rules.

Chatham resident Berlean Burris, the wife of former U.S. Sen. Roland Burris, says she reached out to a family who, with the help of Section 8 housing aid, moved in to the house next door while the owner, an investor, tries to find a buyer for the place.

“When she first moved in, I went over there and talked to her and brought her a basket of things,” she says. “Another neighbor told me she did the same thing. She says a Section 8 resident was barbecuing in the front yard, and she went over there and said: ‘You know we don’t barbecue in the front lawn. You do it in the back.’ And they started barbecuing in the back.”
Probably better to be sociable than to be snobbish. Probably too soon to tell whether the long-term residents will socialize the street punks, or if the street punks will come to dominate Chatham.

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