Vol. 22, No. 5,514 - The American Reporter - September 7, 2016



by Joyce Marcel
American Reporter Correspondent
Dummerston, Vt.
August 4, 2005
Momentum
HOW THE REAL ESTATE BUBBLE IS BURSTING THE AMERICAN DREAM

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DUMMERSTON, Vt. -- The stories keep coming, and none of them are good.

A friend and her fiance are trying to buy a house in the Northampton-Hatfield area of Massachusetts. Shacks with wet basements are on the market for $300,000. They not only sell instantly, but, usually, for more than the asking price.

Since he lives in Suffield, Conn. and she lives in Greenfield, Mass, their only chance of ever living together is by finding a house in the middle. Otherwise, they'll keep on burning up rubber on the road. They have been house-hunting virtually every weekend for two years. And they're not alone:

  • Another friend reports that she stopped at an antique store south of Rutland to buy Vermont-made jams, and the owner told her he was phasing out the $5 items because he can't sell them anymore. He can only sell $1,000 items.
  • Still another friend, Kitty Werner, who has lived in Waitsfield, in central Vermont, since 1975, is angrily leaving her home and building in the back woods. Why? For one thing, "trophy houses" are being built on the hill above her home on her formerly quiet "classic country farm road," threatening her water supply. For another, many of her friends have been driven out by the high real estate prices. "It used to be that you'd drive down the road and wave to everyone.. and you smiled wherever you went. Not no more!"

    A third reason is that the newcomers "can't drive in the snow, but drive the biggest honking SUVs they can find - any reason we who live here drive Subarus? But the newcomers treat us as if we're idiots and dumb. Strange that we were smart enough to come here first." Werner, the author of "The Savvy Woman's Guide to Owning a Home," can be considered as something of a Vermont housing authority.

    The real estate boom has exponentially increased the value of all our houses, but the reality is that if we cash in, we're forced out. Even with a bucketful of profit, we can't afford another home in our own home towns. And yet, as we sit here like the proverbial ducks, our rising property taxes threaten us with the specter of being forced out.

    The Associated Press feeds our fears by writing stories like the one in last weekend's paper: "Second Home Boom Fuels Market." "As of last year, there were more than half as many second homes around the country as owner-occupied homes," the AP said. In this dismaying trend, Maine and Vermont turn out to be the nation's trendsetters.

    People are buying here because real estate costs in Boston and New York have gone through the ceiling, because it's cheaper here, and because we're only two or three hours away from the cities. Because it's beautiful here. Because 9/11 (and the more recent bombings in London) have left city dwellers running scared. Because the stock market is unstable; with interest rates so low, houses (and "flipping" them, or quickly selling them to make a profit) have become a good investment.

    They're coming here, to Windham County, because we enjoy a high level of art and culture. (Yet another friend, who works in real estate law in the Rutland area, says it's getting harder to sell condos in ski country because the resorts are intellectually vacant places. "Watch out," he said. "They're coming to you in Brattleboro, where you have a thriving arts scene.")

    In the meantime, the creative people here - the ones responsible for our desirable cultural atmosphere - are shaking in their shoes over gentrification. While Vermont gets all up-in-the-air-excited about the "Creative Economy," every creative person who has ever lived in a city knows the formula: first the artists move into an undesirable area because rents are cheap. They force out the locals. Then stores come to support the artists, followed by fern bars to replace the local watering holes. By the time the high-end stores and restaurants come in, prices and rents have soared and the artists have been forced out. Gentrification has always been a fact of life for artists in the city, but it is beginning to look like an unstoppable force in the country, too.

    There's a human cost to this real estate bubble. Children can't afford to buy homes in the towns they grew up in; they leave the area and even close families get split up. Downtowns become full of art galleries and homemade soap stores instead of shoemakers, fish markets, greengrocers and soda fountains. Our friends and neighbors are forced to leave. We no longer see familiar faces when we walk downtown.

    It used to be the American Dream: buy a home on a 30-year mortgage, make friends, work hard, raise a family, be part of the community, watch the children marry, help them set down nearby roots, finally have a party and burn the mortgage, retire and putter in the garden, die and be buried in the local cemetery.

    This was a great dream, a great promise, and now it's gone.

    "We are losing our history, losing our children out of here, losing to greed what makes Vermont special," Werner said. "The green space is going, going, gone. It's a race to see who can sell what at an outrageous price to some sucker from down south, and the suckers keep on coming.

    "We're turning Vermont into exactly what people are fleeing from in New York and Boston."

    Joyce Marcel is a free-lance journalist who writes about culture, politics, economics and travel.

    Copyright 2016 Joe Shea The American Reporter. All Rights Reserved.

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