Housing Crunch Turns Literal in Victorville: Cheaper to Demolish Than To Complete Building

The real estate market may be bad everywhere, but it is particularly bad in Victorville, California, where the real estate crash has turned quite literal. There, failed developments are being torn down because the cost of demolishing the houses are cheaper than completing and selling them.

Peter Y. Hong of the Los Angeles Times has more:

The Victorville demolition is one of the most dramatic ends to a bad bet made during the housing boom, but abandoned developments have become an all-too-common sight in California. Nearly 250 residential developments totaling 9,389 homes have been halted across the state, according to one research firm.

The developer of the Victorville project had hoped to sell the houses for more than $300,000 as they were being built last year, Forrester said. But reality quickly diverged from that vision. Home prices have tanked faster in San Bernardino County than any other Southern California county during the downturn. In March, the median home sale price for the county was $160,000, down 43% in a year, according to the San Diego-based research firm MDA DataQuick.

Officials of Guaranty Bank of Austin, Texas, which took over the development last year, were unavailable for comment. But Victorville city spokeswoman Yvonne Hester said the bank decided not to throw good money after bad.

"It just didn't pencil out for them," she said. "They'd have to spend a lot of money to turn around and sell the houses. They just made a financial decision to just demolish them."

Link (Photo: Christina House / LA Times)


Newest 5
Newest 5 Comments

The issue here is exposure and maintenance. Modern buildings aren't damp, cold, dark stone structures like before. Every wall has insulation, wiring, air paths, serpentine seals, etc. Every join has to be sealed, insulated, drainage installed, and so on.

A lot of engineering goes into making a modern house that will shed water, be air-permeable yet not leak energy in the form of AC/heat, fall under code, etc. Add to this the massive liability costs of selling a house with such potential damage and you're talking huge, huge costs to finish and sell the structure.

Let a little mold or water get into the house before it's all built and it's usually cheaper to scrap it.

Some cars are cheaper to junk than to fix - and so are some houses.
Abusive comment hidden. (Show it anyway.)
I find it very disturbing that over the years our building techniques have only gotten sloppier and not made to last. We marvel at the amazing works of the ancients and it is their buildings that we look up to. I think we need to take a look at what we want to leave behind us as a legacy, and start using resources that will not need to be torn down in a few years. It is such a waste of building, resources, and labor to build these flimsy houses--we waste enough.
Abusive comment hidden. (Show it anyway.)
Makes sense, really. The banks don't want a total loss, which is what would happen if they gave away lots with the unfinished houses, or even no houses. However, the cost of either maintaining unfinished houses, or finishing them and then maintaining them until the market picks up would be too high. Thus, tear 'em down is the cheaper solution. Most likely, they'll hold onto the land until the market comes back, at which point they'll develop anew, or sell to developers.
Abusive comment hidden. (Show it anyway.)
Commenting is closed.


Email This Post to a Friend
"Housing Crunch Turns Literal in Victorville: Cheaper to Demolish Than To Complete Building"

Separate multiple emails with a comma. Limit 5.

 

Success! Your email has been sent!

close window
X

This website uses cookies.

This website uses cookies to improve user experience. By using this website you consent to all cookies in accordance with our Privacy Policy.

I agree
 
Learn More