Author Archives: legallysociable

Investing in foreclosed homes goes public

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Here is a new business model: buy a lot of foreclosed homes after a housing bubble bursts, plan to rent out many of the properties, and watch the money flow in.

Though Blackstone is unlikely to sell much or even any of its stake in an IPO, the stock market debut will test investors’ interest in the idea that the rental-home business can be institutionalized as apartments, shopping centers and office towers were before.

Blackstone and others investors believed that the housing collapse presented a rare opportunity to acquire homes for less than it cost to build them. Millions of foreclosures created a market large enough to justify investing in large systems to manage and maintain sprawling portfolios of rental homes…

To generate the revenue growth that shareholders will demand, they must pace rent hikes to avoid spooking tenants into becoming home buyers themselves. And now that foreclosure rates have returned to normal levels and prices have rebounded, they could find it difficult to add new houses at attractive prices.

They also must convince investors that huge home-rental companies are viable long-term businesses, not just massive portfolios of properties that need to be sold off.

I imagine there will be some particular parties (not just investors) interested in how this works out:

  1. Nearby residents. What happens if this leads to significantly more renters of homes in certain places? Americans tend to view renters more negatively than homeowners – though this might change in the future if the country shifts to fewer homeowners. How well will Blackstone do with having quality renters and following up with issues?
  2. Communities. Having renters is probably preferable to having vacant homes. But, they might have similar concerns as nearby residents as well as other interests in how Blackstone uses the properties.
  3. Advocates for affordable housing. There was some concern a few years ago that having large firms like this purchase cheap homes could limit lower priced housing. The lower end of the housing market could use more stock but investors may need to pursue higher rents in order to generate profits.
  4. Renters and homebuyers. What kind of rents will Blackstone charge? Will they eventually sell these properties and at what price? What kind of landlords will they be.

Additionally, I wonder what would happen if this does not prove to be a viable business plan. Are there others who would be interested in purchasing these properties? What if foreclosure proceedings begin with an institutional investor?

Vancouver reaches goal of 50% of city trips not by car

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How did Vancouver reach its goal of limiting car trips ahead of schedule? Here is one explanation:

It all began back in the late 1960s, says the city’s former chief planner (and urban-Twitter celeb) Brent Toderian, when residents rejected a proposed highway that would have torn up the dense urban core and separated it from its famous waterfront. Vancouver is still the only major North American city without a freeway running through it. The open waterfront became the location of the hugely successful Expo ‘86, which was themed around the future of transportation and featured the debut of the elevated SkyTrain, a swoopy automated light rail system. A new extension that opened in December allowed SkyTrain to reclaim its title as the world’s longest fully automated metro system in the world (besting the similarly driverless Dubai Metro). The system also helped pave the way for the dramatic transformation of Vancouver’s waterfront a couple of years later. Hundreds of new residences and offices were built, unified by pedestrian thoroughfares and the city’s seawall—which is “routinely ranked as the best public space in at least Canada,” says Toderian.

The 2010 Winter Olympics encouraged more car-to-pedestrian street conversations, and peppering the in-between years were lots of smart decision-making, such as turning a stretch of Granville Street into a pedestrian mall in the 1970s and the city’s 2008 strategic shift to support cycling as daily form of mobility rather than pure recreation. A mess of new protected bike lanes have pushed Vancouver’s active-transit infrastructure beyond the downtown core: “24 percent of our bike network is now considered [appropriate] for all ages and abilities,” says Dale Bracewell, the city’s manager of transportation planning. A $2 billion plan to expand TransLink, Vancouver’s mass transportation network, was approved last month by the mayor’s council, and stands to bring active transit options to parts of the city that haven’t had them before.

Three quick thoughts:

  1. Such efforts do not happen overnight. This explanation involves decades of consistent efforts to provide other transportation alternatives. Many American places could benefit from less driving but quick fixes are difficult.
  2. Related to #1, how many places could sustain such efforts over decades? Are certain places like Vancouver more predisposed toward such ideas? There could be multiple reasons for this. Perhaps different urban cultures enjoy less driving. Perhaps the government here was particularly effective in funneling funds and resources to mass transit rather than roads. Perhaps the housing in Vancouver is so expensive that it is unrealistic for a lot of people to also pay for cars.
  3. Vancouver is often said to have a very good quality of life. Would Americans made the trade of a better life overall for people versus the individual freedom they often value to drive around when they want?

The Internet and social media can help us see more small things but the bigger picture is still fuzzy

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On one hand, the Internet and what comes along with it allows us unprecedented access to what is going on in the world. Information galore. Bypassing the traditional gatekeepers of the media. Access to millions of stories we might not have otherwise seen or heard.

On the other hand, it is a glut of stories and information. The social media feeds just keep going. The 24 hour news cycle of cable TV news is now an up to the second compendium of events big and small. There is a lot to take in. Some of the research I’ve done with the social media use of emerging adults suggests some have a hard time keeping up with it all. What should we pay attention to?

Going forward, I fear the extra information we now have – an unprecedented amount in human history – isn’t helping as much as it might. This is the case for at least four reasons. First, even though we have more information, we still don’t have all the information. As Max Weber once said, social life is so complex that it is difficult to imagine even social scientists understanding all aspects of social phenomena. Second, we’re not necessarily good as humans or trained well in how to process all the information. Certain things catch our eye – for example, such as information that agrees with what we already think (confirmation bias) – while we see others but they don’t register at all. Third, there is simply too much. Perhaps humans were not made to think at this scale; for much of human history, we lived in relatively small settings and had close relationships with people who were pretty similar to us. See Dunbar’s Number as an example of how the limits of humans comes up against friends and followers on social media.

Fourth, and this is where my sociological perspective particularly comes in, it is difficult work to connect individual level data – what we might call microsociology – with larger societal trends – macrosociology. Take this example: we see a post of involving a person with particular traits leaving no tip for a waitperson which they have posted on social media. Unfortunately, such negative interactions happen frequently. But, are we to take this single example as just an attempt to point out a wrong done by a single customer or does this one event reflect on an entire people group? Or, is a serious weather event on the other side of the world (one we would have had little knowledge about even a few decades ago) evidence for climate change or for deniers? When we are immersed in so many small events and their immediate interpretations, how are we to form big picture understandings of patterns? It requires us to step back and try to make sense of it all rather than simply slotting each small event into our existing heuristics.

Our capacities to deal with all of this information may improve in coming years as it becomes the new normal. Or, some may go another direction – though it is hard to imagine – where they retreat from this information overload. Either way, we’ll need to figure out ways to help everyone see the broader patterns so we all don’t lose the forest for the tees.

Could bad traffic in Manhattan lead to fewer cars on the road?

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One way to reduce traffic might be to make it so unpleasant that people stop driving so much:

City officials have intentionally ground Midtown to a halt with the hidden purpose of making drivers so miserable that they leave their cars at home and turn to mass transit or bicycles, high-level sources told The Post.

Today’s gridlock is the result of an effort by the Bloomberg and de Blasio administrations over more than a decade of redesigning streets and ramping up police efforts, the sources said…

The goal of the jammed traffic is to shift as many drivers as possible to public transit or bicycles.

An added benefit was supposed to be safer streets, but city officials have said that while 45,000 fewer cars and trucks now come into Midtown daily than in 2010, pedestrian deaths are on the uptick this year.

The city denies such efforts with the mayor’s spokesperson saying, “The notion that we want or are somehow ‘engineering’ traffic congestion is absurd.” But, there is little argument that the city has tried now for over a decade to introduce additional transit options beyond people driving cars.

The real question we should ask is whether such efforts can reduce congestion. Even though the public may not like it or believe it, there is some evidence from road diets and closing highways (in places like San Francisco or Seoul) that traffic is not static: limiting roads can affect the choices people make regarding how to get around. In other words, build more highway lanes and more people will drive.

Perhaps Manhattan itself is simply too crowded for the transportation options Americans currently have. Even the sidewalks are supposedly overrun. Could this be remedied with a new, innovative regional transit plan that would work on ways to get people in and out of Manhattan more efficiently? Would affordable housing help so fewer people have to make long commutes to Manhattan?

Let Amazon’s big data tractor trailer drive to you

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Americans like big trucks and hard drive space so why not put the two together?

Amazon announced the new service, confusingly named Snowmobile, at its Re:Invent conference in Las Vegas this week. It’s designed to shuttle as many as 100 petabytes–around 100,000 terabytes–per truck. That’s enough storage to hold five copies of the Internet Archive (a comprehensive backup of the web both present and past), which contains “only” about 18.5 petabytes of unique data...

Using multiple semis to shuttle data around might seem like overkill. But for such massive amounts of data, hitting the open road is still the most efficient way to go. Even with a one gigabit per-second connection such as Google Fiber, uploading 100 petabytes over the internet would take more than 28 years. At an average speed of 65 mph, on the other hand, you could drive a Snowmobile from San Francisco to New York City in about 45 hours—about 4,970 gigabits per second. That doesn’t count the time it takes to actually transfer the data onto Snowmobile–which Amazon estimates will take less than 10 days–or from the Snowmobile onto Amazon’s servers. But all told, that still makes the truck much, much faster. And because Amazon has data centers throughout the country, your data probably won’t need to travel cross-country anyway.

One could make a strong case that semis make America go. And all the money that the government has put into highways and roads certainly helps.

Prediction that the 2017 housing market in the Chicago region will be country’s worst

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Realtor.com just released a prediction that the Chicago housing market will not do very well next year compared to the country’s other largest markets:

Both prices and sales will increase, but at a stunted rate compared with other areas, according to a forecast by Realtor.com, a website for the National Association of Realtors. The prices of homes throughout the Chicago metropolitan area are expected to climb just 1.95 percent, and sales of new and existing homes are expected to increase 2.27 percent…

Chicago’s problem is a combination of slow growth in both population and jobs, said Jonathan Smoke, an economist at Realtor.com. The area’s population is expected to increase only 1 percent next year.

Given the size of Chicago, the city should be among the nation’s top three markets for job creation, Smoke said. Instead, Chicago is ranked eighth, with job growth much stronger in areas such as Dallas and Phoenix…

Nationally, Chicago has been among the slowest areas to recover from the housing market crash. According to the S&P CoreLogic Case-Shiller Index released this week, Chicago’s home prices on average remain about 20 percent below July 2007 levels. Meanwhile, the average price for the largest 20 metropolitan areas is now above pre-crash levels.

Not good news for a region that is still the third largest in the country but suffers from a number of problems: its central city is losing residents, the state government is a mess with no long-term budget deals in sight, it doesn’t seem to have enough innovative companies or industries, and there are negative perceptions about violence. Add a slow housing recovery and both the people living there as well as those who might consider moving there may not see much to celebrate.

Actually, this is an interesting question to consider: what positives would Chicago region residents note compared to other regions? What would attract those who have the ability to choose where they want to live? Chicago may be an important global city but it doesn’t want to slowly slip into being a center solely for the Midwest.

One important trait of the Chicago region isn’t going away anytime soon: even in the world of the Internet and jet travel, it has a prime location in the middle of the United States and is a key piece of many transportation and freight networks.

“Tom Brady, sociologist of religion”

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A new documentary series looks at how sports fosters belonging and Tom Brady is one of the people behind it:

The theory, as you might guess from the title, is that sports, broadly constructed, are a kind of religion. As Chopra intones during the introduction, with images of stadiums and religious pilgrimages rolling by, sports “have believers, priests, and gods. They have rituals, miracles, and sacrifices. Sports unite us. They are a calling.”…

In parsing “the religion of sports,” Chopra and his star-powered co-producers are trying to understand a resilient form of meaning making and community formation in the United States. It seems a little silly to group Chopra and co. with social theorists like Alexis de Tocqueville and contemporary scholars who worry that America’s community structures are fraying. But, incredibly, that’s the project they’ve created: a sort of jock’s guide to civil society. While the series can, at times, come across as a rosy-eyed passion project, its central insight—that sports can be understood as a way that people find belonging—reveals a rich theme for artists who seek to grapple with the strong sense of cultural division and isolation experienced today by Americans of different ethnic, class, and political backgrounds…

Chopra takes this literally: “Sports is an actual faith. It’s not even metaphor. It’s real. You practice these things,” he said. This is debatable—Chopra is looking at religion purely as a matter of practice, while discounting the importance  of belief. Sports are not about the metaphysical nature of the universe; they provide no guidebook for the self or community in navigating life.

But, to embrace Chopra’s interpretation of “religion” for a moment, it’s curious to consider the ways in which sports participation has not followed the same trend line as other communal activities. According to organizations like Pew, traditional religious affiliation is steadily declining in the United States; participation in civil-society groups like bowling clubs or parent-teacher organizations has gone down significantly as well. As Americans have pulled away from these kinds of community institutions, their love of sports has stayed relatively constant: According to Gallup, the percentage of Americans who call themselves “sports fans” has hovered around 60 percent for at least the last 15 years.

This sounds like a Durkheimian exploration of a functional religion, another area of social life that has some similar characteristics to religion. Sports involve rituals, collective effervescence, totems, and beliefs. This could range from sports (earlier posts involving the World Cup and the belief of some American sports fans that supernatural forces are involved) to following Apple (earlier post here).

I hope, however, this documentary series doesn’t fall into two common traps with this comparison:

  1. Sports are the magic elixir that can bring everyone together. (In contrast, many argue today that religion divides people.) Being a fan alongside another fan may bring individuals together for a moment but does it really make the world a better place? Does racism really disappear? Are cities healed? My answer: no and see these earlier posts on the effect of the Cleveland Cavaliers, the ability of soccer teams to bring about urban revival, and the Chicago Cubs winning the World Series. .
  2. Putting sports fandom and religion side by side suggests that it doesn’t matter ultimately what people believe; it is simply that common beliefs bring people together. Not all beliefs at the same level. Do sports really dictate how most people make major decisions in their life? Do sports provide ultimate meaning? (They may serve this role for a small number of people but religion is still going pretty strong throughout the world.)

The documentary series will reveal how much it gets right about the sociology of sport and religion…

 

Buying vacant Chicago lots for $1

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Many Rust Belt cities have plenty of empty land and the city of Chicago is selling some of these lots for $1 a piece:

In an effort to combat urban blight and the illegal activity that often follows, the City of Chicago has announced a major expansion of its Large Lots program that offers empty city-owned parcels to nearby homeowners for just $1.

After debuting in Englewood and East Garfield Park in 2014, more than 550 homeowners have so far taken advantage of the program. Now, thanks to its recently expanded scope, Large Lots will extend to 33 Chicago communities on the West and South sides, offering 4,000 empty properties at the extremely discounted rate…

Not just anyone can swoop in and grab real estate for a buck, however. To purchase a lot, buyers must reside on the same block, be current on their property taxes, and be in good financial standing with the city in order to be eligible. Large Lots will be accepting applications on its website through the end of January.

The city tells the Chicago Tribune that all lots in the program are reserved for residential uses such as extended side or back yards, gardens, parking pads, or landscaped green space. In addition to improved neighborhood aesthetics, the Trib also cites a study that found the program yielded a notable drop in nearby littering, drug activity, and prostitution.

Eliminating empty properties is probably a good first step. But, what is the next step? What is the long-term solution to reviving both these properties and neighborhoods?

I will occasionally get questions from students as to why people or businesses don’t see vacant land like this as opportunities. On one hand, the Chicago metropolitan region is in desperate need of affordable housing. On the other hand, these properties are often located in poorer neighborhoods. But, a collection of residents or organizations could really make something interesting out of cheaper properties and the city would benefit from better uses.

Trying to replicate Times Square in places like Atlanta

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Large cities often borrow ideas from each other. But, is it possible to design places like Times Square into being by adding lights?

Some smaller American cities have recently been attempting to mimic this aesthetic, albeit on a lesser scale, in the hope of spurring economic development and a more pedestrian-friendly downtown. Denver’s theater district, for instance, now features an enormous video screen and lighted advertisements peddling the latest in products and entertainment, and Atlanta is in the process of planning such a district for a section of its downtown.

The organization Central Atlanta Progress (CAP) is spearheading the effort to relax signage restrictions so that property owners can go bigger and brighter. “At this point, downtown Atlanta’s zoning doesn’t allow signs that are over 200 square feet, and our billboards are stuck in time,” says Jennifer Ball, CAP’s Vice President for Planning and Economic Development. “We’re anticipating an increase in size as well as the ability to do large-screen video and LED boards.” Atlanta’s City Council will likely vote on the measure in January…

But the larger aim is to bring more people downtown—and for them to experience the area on foot rather than in their cars. Atlanta is known for its incredible sprawl, with its more walkable neighborhoods scattered throughout the city and thus only easily accessed via automobile. The city is aiming to make itself denser and more pedestrian-friendly, and the district is, according to Ball, “a piece of the puzzle.” To further that goal, the bright lights district would also include more housing and ground-level retail outlets and restaurants. “Atlanta wants to have a strong core that is walkable and bikeable and has the level of density to support a lifestyle where you don’t have to be in your car all the time,” Ball says.

Such a multi-pronged strategy is important, as urban lighting scholars caution that illumination on its own doesn’t guarantee an increase in business or foot traffic. Margaret Petty, Head of the School of Design at Australia’s Queensland University of Technology and a historian of electric lighting, says that there’s no evidence to suggest that lighting alone attracts people to an area, unless that area, such as Times Square, is “iconic.” Josiane Meier, lecturer at the Technical University of Berlin and co-editor of Urban Lighting, Light Pollution, and Society, adds that the “if you build it, they will come” model doesn’t really work in terms of lighting and density. “The interdependency runs the other way,” she says. “Density is a prerequisite for the existence of bright lights districts.”

It sounds like the Atlanta plan isn’t just about lights; it is about creating denser, vibrant places with a variety of uses and lights (which both can attract people and highlight existing activity). New Urbanism and Jane Jacobs come together to possibly reshape Atlanta.

Will it actually work? This reminds me of the number of cities that tried to replicate the High Line after it proved very successful in New York City. It isn’t hard to build things to look like someplace else – look at Las Vegas – but it is difficult to create legitimate neighborhoods that aren’t just tourist destinations. Times Square is interesting not just because of the tourists but also because it is at the center of the number one global city (New York City) and and is located in one of the most densely settled places in the United States (Manhattan). A bar/entertainment district with some housing above and nearby may be nice but it can’t exactly replicate the conditions of a New York City or London or Tokyo.

What could a city like Atlanta create that would be more authentic to itself while also increasing density and vibrancy? What is unique to Atlanta that can’t be found elsewhere (besides the sprawl)?

Where does the data on the number of Americans traveling for Thanksgiving come from?

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It was widely reported this year that nearly 49 million Americans would be traveling for Thanksgiving this year. This data comes from AAA and here is the methodology according to their press release from November 15:

AAA’s projections are based on economic forecasting and research by IHS Markit. The London-based business information provider teamed with AAA in 2009 to jointly analyze travel trends during major holidays. AAA has been reporting on holiday travel trends for more than two decades. The complete AAA/IHS 2016 Thanksgiving holiday travel forecast can be found here.

When numbers like this are used in public and reported on by the media, I would guess many Americans expect these figures to be based on surveys. So what is this projection based on? Surveys (probably via phone calls)? Historical models (based on factors like gas prices and broader economic indicators)? Certain retail and tourism figures like hotel and airfare bookings?

What makes this more complicated is that AAA is an organization that could benefit from increased travel, particularly driving. And as they note on the press release, their organization can provide benefits to travelers:

AAA will rescue thousands of motorists this Thanksgiving AAA expects to rescue more than 370,000 motorists this Thanksgiving, with the primary reasons being dead batteries, flat tires and lockouts. AAA recommends that motorists check the condition of their battery and tires and pack emergency kits in their vehicles before heading out on a holiday getaway. Drivers should have their vehicles inspected by a trusted repair shop, such as one of the nearly 7,000 AAA Approved Auto Repair facilities across North America. Members can download the AAA Mobile app, visit AAA.com or call 1-800-AAA-HELP to request roadside assistance.

This does not necessarily mean that the data is inaccurate. At the same time, it would help to make the methodology of their projections available.

Another thought: are Americans helped or hindered by these broad projections of holiday travel? If you are traveling, does news like this change your plans (i.e., leave earlier)? If AAA projects more drivers, do traffic delays increase (such as on the 405 in Los Angeles)? If the BBC links the incidents, perhaps people take these figures seriously…