Noam Chomsky on the Economy & Housing Crash

Ben Cohen

Editor of The Daily Banter.comMy Interview With Noam Chomsky on the Economy

"The immediate problems were caused by the housing bubble that Alan Greenspan had permitted to explode. They could have controlled it on the basis of the kind of lunatic belief in free market fundamentalism. So they allowed this bubble to explode and the houses were way beyond their trend line, the actual realistic price. They've been collapsing, but they've got a long way to go. The Bush economy, which was like the Reagan economy, is very fragile, and is based on debt -- lenders from abroad, and also consumer spending which is debt driven. Consumer spending was largely based on inflated house prices, essentially collateral, and as the house prices collapse, so does the basis for consumer spending, then the economy collapses because its not a well functioning real economy."

What were they thinking???


Infill at its best!  The scale of this new Hummer House looks ridiculous next to the home next door that has been there for 50 years.  Ridiculous!

Typical McMansion Built To Impress or Bore???

"There's No Place Like Home." - Dorothy

How much space does one person really need to be happy?  Do we feel more or less comfortable in an excessive "Hummer" House compared to a cozy cottage or cabin?   

How can people in huge cities like Manhattan live comfortably for years in 600 SF. apartments when others in the suburbs complain their homes are to cramped at 3000 SF?

What do you think of when you think of home?  A place?  A person? A family?  A city?  Or a house?  Where is home for you?  Is it where we are from or where we are destined?  I think it is where we always long to be.  A place of comfort that offers safety, security and protection from the chaotic world we live in.  A place of refuge where we always feel welcome, loved and secure.  Does this place exist?  For some possibly, and for others....maybe only in their dreams.

We all need a place to live so we all should long for a place we to call home.  I think Dorothy was right....."There's No Place Like Home."

Cottage vs. McMansion

While the former feels “home-grown”, the latter
seems to subjugate its landscape. Cottages are warm, tactile and inviting; McMansions are cold, exacting and detached.  One fits like a glove and is as comfortable as a favorite faded pair of blue jeans.  The other is large enough to host a formal affair and feels like black tie invite only.  One will intimately embrace its habitants and one will will require an intercom system to talk to its habitants.  One will be trying to keep up with the Joneses and the other.... well.... it is just happy to be :)


What one is more appealing to you? 

“Place is security, space is freedom; we are attached to one and long for the other.” --Yi-Fu Tuan, geographer

Maybe what we really want is a cozy cottage with plenty of outdoor open space around it.  Sounds like a recipe for happiness.
"Home is where we start from, but home is also where
we are bound for, the place we always seek."
– David Steindl-Rast

Small, modestly priced new homes are gaining popularity points!


http://www.builderonline.com/design/cottage-industry1.aspx

Is the McMansion Dead?

It’s the scapegoat of the housing bust, and that’s not all. From accusations of ostentatious overconsumption to environmental indifference, the McMansion has taken some brutal hits in the recession economy. Are those blows lethal enough to send starter castles to their grave? Or will they live to see another boom?
By:
Jenny Sullivan

Credit: Courtesy NTHP/Adrian Scott Fine

There’s no shortage of McMansion haters out there. Some are vociferous, but others are stealthy—such as the Florida couple who recently purchased three-quarters of an acre in a neighborhood many consider to be prime teardown territory.
Fellow home buyers in this posh, lakefront part of Orlando, Fla., didn’t think twice about razing and replacing existing homes with new ones more than double in size. But these passive resisters have something more modest in mind for their family of five.

In lieu of a 7,000-square-foot palace that antes up to the neighbors, they’re planning a house less than half that size with energy-efficient features, panelized construction to reduce waste, and a variety of flexible, multipurpose spaces. One of its four bedrooms will double as a guest room.
In some ways, it’s atonement for an oversized spec home they owned previously, which they describe as a “cavernous” place with rooms that were seldom used.
“Environmental concerns are one reason for downsizing, but we also want to know what’s going on with our kids,” the husband says. “A smaller house helps facilitate that. When they share space, they are forced to resolve their differences. We have the financial ability to have a larger home, but it doesn’t make sense.”
Chalk it up as another point for the opposition in the McMansion wars.

Efforts to stem the proliferation of monster homes have no doubt reached epic proportions in recent years. But the battle lines are sometimes fuzzy because the enemy isn’t always clear.
What exactly is a McMansion?
By some accounts, it’s the gargantuan greenfield tract home with a Hummer parked out front that perpetuates sprawl and makes gas guzzling a way of life. Others use the derisive term to describe ostentatious infill homes that—while walkable to schools, shops, and transit—tower over beloved bungalows in established neighborhoods in a way that is less than neighborly.
But different people live by different standards of propriety, and that’s where codifying the offenders becomes difficult.

Can the vilified McMansion, in its various forms and habitats, survive a post-recession economy? Many signs suggest the odds are stacked against it. Lending standards have tightened, and many buyers no longer have the cash on hand for down payments on fancy homes. Add to that a U.S. unemployment rate that continues to hover around 9.5 percent and resale competition from foreclosures (many of which are McMansions themselves), and the outlook seems bleak for showy homes that many consider emblems of decadence and greed.
Even for those who can afford them, trophy homes constitute an image problem at a time when modesty has become fashionable. One recent CNNMoney.com poll asked more than 33,000 online readers if they thought American homes had gotten too big; 69 percent said yes.
Demand for big houses could also fizzle as population shifts place families with kids in the home buying minority. Some demographers estimate that up to 80 percent of new households formed over the next 15 years will be child-free as Baby Boomers empty their nests and career-driven Millennials postpone marriage and kids.

Sensitive infill homes respect the scale and character of the neighborhood.
Credit: Courtesy NTHP/Adrian Scott Fine

McMansions also continue to draw fire from neighborhood groups rallying to protect their streetscapes. The National Trust for Historic Preservation (NTHP) estimates that as many as 500 communities in 40 states have launched anti-teardown campaigns in an attempt to curb the proliferation of super-sized homes. Some groups have ignited city-issued moratoria on new residential construction, while others have helped handcraft ordinances that regulate building height, setbacks, and floor-area ratios.

Among the most infamous is the “McMansion Ordinance” enacted in Austin, Texas, in 2006, which limits most new or remodeled infill single-family homes to 2,300 square feet with a height limit of 32 feet. A similar measure passed last year by the Los Angeles Sunland–Tujunga Neighborhood Council dictates that any floor with ceiling heights greater than 14 feet counts as twice the square footage of that area. Bye-bye, vaulted foyers.

“Teardowns may not always be stellar landmarks on their own, but the issue comes down to streetscape character,” says Adrian Fine, director of the Center for State and Local Policy at the NTHP. “It only takes one McMansion to disrupt that character and cause a domino effect.”
But builders aren’t entirely to blame for this scenario. Antiquated zoning laws (and the planning boards that uphold them) also play a part. When builders find themselves handcuffed to standard lot sizes, minimum square footage requirements, and high land costs, the tradeoff is often building to a lower specification to arrive at a pro forma that pencils. The solution ends up being a lumbering stock plan with a brick front, vinyl siding, and little to no side yard.
How does one stop that cycle? “What needs to happen is buy-in from local municipalities with respect to [alternative] zoning,” says Bill McGuinness, president of Sun Homes in Pawling, N.Y. “Rather than large, planned new towns in the middle of nowhere, the existing towns in our market need to be reclaimed through things like creative density swaps and aggressive planning. Towns hopefully will figure out that the net drain of sprawled out subdivisions on municipal resources is unsustainable, and that well-planned densification of existing core areas can be a net fiscal benefit. This is difficult because so few towns have the knowledge, budget, and understanding of the issues to pull it off.”

Housing trend moves toward smaller homes with more upgrades

By Jean Patteson, Orlando Sentinel
In Print: Saturday, June 27, 2009
ORLANDO — They've been dubbed "jewel-box houses" — small homes designed with top-quality materials, upscale detailing and custom built-ins.
Tailored to the owners' way of life, smaller homes suit a variety of demographic groups, including newlyweds, young professionals, empty-nesters and retirees — the last two a fast-growing segment of the population. The recession, the downturn in the housing market and the emphasis on energy-efficiency all are playing into the jewel-box trend — and are making it increasingly difficult for homeowners to unload "starter castles," says architect Sarah Susanka, author of The Not So Big House.
For the past two decades, dream homes have assumed McMansion proportions, says Stephen Gidus, co-owner of PSG Construction in Orlando. Now, "downsizing" is the new watchword.
"Homeowners are taking that portion of their budget that would have been used for larger living spaces, and using it for better details in smaller spaces," Gidus says.
There are signs the housing industry is heeding this trend toward jewel-box homes. Data collected by the National Association of Home Builders in 2008 indicate the average size of a new home is leveling off at just under 2,500 square feet.
One such jewel-box home belongs to Clifford and Krista Goeller of Orlando. Designed by Lucia Custom Home Designers and built by PSG Construction, the exterior features the Craftsman styling popular in the early 20th century, complete with a recessed porch, tapered-box columns and fish-scale siding. The interior has a contemporary open floor plan, but is detailed with traditional Craftsman elements such as wood floors with inlaid tile, an oak staircase and a built-in, furniture-grade entertainment center surrounding the fireplace.
The 2,300-square-foot home "suits our lifestyle and our taste," says Krista Goeller, a transplant from Wisconsin. "Florida houses seem so big and cool and painted. We like the warmth and richness of stained wood. We wanted a cozy house, a house that looks as if it belongs among big old oak trees with moss hanging down."
Huge houses with hotel-scale foyers, formal dining and living rooms, and vast master suites with spa-style bathrooms are out of synch with the informal way Americans live today, says Susanka. In most homes, the kitchen is the place where family and friends gather. Americans take quick showers; they don't luxuriate in soaking tubs. So why not invest in areas we regularly use, and eliminate those that are mostly for show?
Not surprisingly, the home-furnishings industry is attuned to the downsizing trend, says Jackie Hirschhaut, vice president/marketing at the American Home Furnishings Alliance.
Increasingly, manufacturers are making furniture that is smaller and more multipurpose: love seats instead of sofas, expandable dining tables, home-office armoires with fold-down work stations, and compact corner units for big-screen TVs.

Due to the economic recession and a renewed interest in lowering utility costs, there has been a growing demand for smaller sized homes.

AIA News Release
June 29, 2009
HousingZone
Washington, D.C. – June 29, 2008 – Due to the economic recession and a renewed interest in lowering utility costs, there has been a growing demand for smaller sized homes in recent years. There has also been an adjustment in the volume of living space with a preference for lower ceilings and a diminished interest in two-story foyers. Property upgrades, however, are extremely popular with households trying to maximize their usable space with finished attics and basements, outdoor living enhancements and blended indoor / outdoor features. Accessibility within the home continues to be a concern, especially for an aging U.S. population. Business conditions for residential architects remain weak, but appear to be stabilizing with the first uptick in billings since the second quarter of 2007. These findings are from the American Institute of Architects (AIA) Home Design Trends Survey that focused specifically on overall home layout and use in the first quarter of 2009.

"The era of the 'McMansion' could well be over as home sizes have been trending downward recently, with a significantly higher number of architects reporting demand for smaller homes this year," said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. "And as the housing boom has passed there seems to be a renewed interest in investing in properties to make homes more livable, as opposed to real estate that can be resold quickly for a profit."

The swelling McMansion backlash

http://realestate.msn.com/article.aspx?cp-documentid=13107733

Way Beyond Keeping Up with the Joneses

http://www.npr.org/templates/story/story.php?storyId=5525283

Behind the Ever-Expanding American Dream House



July 4, 2006
Robert Frank, a professor of management and economics at Cornell University, says the growth of big houses is not really about greed. It’s all about context. If you live in a village in Africa, even a modest American house seems huge. But in the United States , there are now millions of people with lots of money, and their wealth shifts the frame of reference for those just below them.
So let’s say you want to find the best school district for your child, but the houses there are huge and expensive. You might take fewer vacations, endure a much longer commute, save less. But you don’t forgo the bigger house, because it means a better neighborhood and a better education.
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A 614 SF House: Impressive!

A 614 SF House: Impressive!
Media cabinet opposite of kitchen counter, open concept and gorgeous finishes make this tiny cottage dreamy.

I want that!

I want that!
1168 SF home gushing with charm looks like "Happily Ever After"

People really do live here!

People really do live here!
This front foyer is the main entrance for family and visitors. It is not meant to impress, but rather to serve meaningful purpose. Its casual appearance encourages visitors to kick off their shoes and stay a while.

People Really Do Live Here Too!

People Really Do Live Here Too!
Coat hooks with real coats and cubbies packed with real stuff...This is how I really live too!

Proud to call this tiny 729 SF Cottage Home!

Proud to call this tiny 729 SF Cottage Home!
Character Busting at the seems of this well designed efficient kitchen.

Doing More with Less

Doing More with Less
This "U" shaped kitchen is small but feels comfortable due to good design and custom finishes.

Doing More with Less Take 2

Doing More with Less Take 2
Comfortable and efficient "U" shaped kitchen with deep drawers for pots and pans, stainless steel appliances and honed granite slab countertops is sure to delight any cook.

Doing More With Less Take 3

Doing More With Less Take 3
A closer look

Perfect reading nook

Perfect reading nook
A box out window layered with built in book cases creates a cozy place to sit and read.

Sunny Built in Dining Nook

Sunny Built in Dining Nook
An invitation for intimate conversation.

Intimate Dining Nook of a 540 SF Home.

Intimate Dining Nook of a 540 SF Home.
Dropped beams, meticulous trim work, contrasting wood tones, cheery colors and a sunny window work seamlessly together to create "WOW" in this tiny home.

No Sheetrock Here!

No Sheetrock Here!
Exceptional use of modest materials make this tiny eat in kitchen worthy of envy! Exposed ceiling rafters, knotty pine tongue and groove walls and ceiling, open shelving uppers, VCT (commercial grade vinyl composite tile) arranged in a checkerboard pattern on the floor and backsplash, laminate counters with a wood edge, butcher block counter on island, custom painted cabinetry and trim, white cast iron sink, white appliances and an adjacent built in booth will have guests talking.

Everything In It's Place

Everything In It's Place
Bead Board, cubbies with baskets, coat hooks, and storage bench keeps everyday gear tidy and accessible.

Smart Design Attic Multipurpose Room

Smart Design Attic Multipurpose Room
Very Smart, indeed!

Laundry, crafts, homework, tech center or whatever...

Laundry, crafts, homework, tech center or whatever...
This smart design attic is a hardworking multipurpose space that gets used plenty.

Cozy Country Kitchen

Cozy Country Kitchen
"U" shaped Kitchen peninsula doubles as a Dining room buffet.

The "not so boring" kitchen

The "not so boring" kitchen
Smart design features small footprint open concept high style kitchen.

Spacious Sleeping Nook or Tight Bedroom?

Spacious Sleeping Nook or Tight Bedroom?
Abundant natural light and dual Pocket doors create a roomy sense of space to this cozy bedroom.

Sleeping Nook

Sleeping Nook
How Big Does a Bedroom Really Need to Be?

Rolling Barn Door Is Great Space Saver

Rolling Barn Door Is Great Space Saver
This bedroom is tight on space. A traditional swing door would not work here and addind a pocket door after the fact would require complicated re-construction. Solution: Industrial rolling barn door hardware and makeshift door (plywood sandwiched between tongue and groove planks). Brilliant and Impressive!

Fine details make this Owner's bathroom stand out from the crowd.

Fine details make this Owner's bathroom stand out from the crowd.
Dormered ceiling detail, custom cabinetry, slate tile and trim details create a luxurious retreat.

Spa tub enclave invites total relaxation.

Spa tub enclave invites total relaxation.
Architectural arch detail over tub and built in cabinetry for towels and toiletries create a Spa Enclave.

This extraordinary home is so cute, do you really care about how many sqare feet it has?

This extraordinary home is so cute, do you really care about how many sqare feet it has?
Traditional Four Square Architecture and Darling front porch says, "Welcome Home."

Friendly Home Oozes Curb Appeal

Friendly Home Oozes Curb Appeal
Steep roof pitch with dormers, inviting front porch, box out windows, architectural trim details and flower boxes make this home "not so boring."

Not so boring ships ladder provides fun access to the loft

Not so boring ships ladder provides fun access to the loft
Tubular natural steel and wood combine form and function to create this unique ladder to the upper level loft space.
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