Because of the rowdy nature of some of these blogs, I find myself having to revisit my basic views about what's happening in Bend.
I grew up here. When I went off to college, in the early 70's, there wasn't even a bookstore. We still had only the Tower Theater, a small theater next to it that started off showing smaller films and then x-rated films, and a drive-in (ditto). A T.V. station came in around the end of my college career. (I had the seven year plan, flunk the first year, take two years off, and go back for another 4 years....) In other words, Bend was small. I'm not terribly nostalgic for the old Bend.
Two malls were built in the late 70's, and downtown nearly emptied out. It was starting to recover when the Reagan recession hit. And we stayed in a near depression until the late 80's.
Pegasus was established in 1980 by Micheal Richardson of Dark Horse, and I worked there from the beginning. I bought the store in 1984. It's always seemed to hit a ceiling in sales just below a real profitable, sustainable level, no matter how the city of Bend has grown, because of the declining customer base for what I sell, and the increased retail competition.
Still, all in all, I'm not anti-growth. I'm anti-stupid growth, anti-rude newcomers.
When I started this blog, all I saw was that they were building way too many houses. That's it. It seemed an obvious bubble. All the credit stuff has emerged since then, but hasn't changed the fundamental observation. I've shifted, somewhat, to more concern over the retail bubble.
As far as the Bulletin is concerned; it is a basically conservative paper which derives it's income from advertising. Of course it's pro-growth, pro-business. I wouldn't expect it to be any different. The Source has positioned itself as the 'alternative' weekly, with more new-agey, youthy tack, but it also benefits from the growth of Bend, and especially the growth of 'culture.'
I believe both papers think they working for the public good. The Source believes that closing the downtown streets for Festivals is a good thing. I don't.
I don't believe developers are inherently evil; but they certainly have shown themselves to lack taste and class, and not to be particularly bright in their planning. The old-timers, such as Hollern and Bauhofer, seem to have a bit more perspective, is all. I don't personally care for golf courses and gated communities.
I don't believe there is any conspiracy; hell, I don't think all these guys are that smart or smooth. I believe that money protects money. Birds of a feather flock together. Power corrupts. Don't need no evil planning for greed and stupidity and short-sighted to overwhelm our little town, creating a superficial and over-blown culture that may just implode.
And I'm ambivalent about the implosion, because I know that the innocents may get taken down along with the guilty.
The best we can hope for, right now, is some kind of soft landing; which is only going to happen if Bend truly is the unique baby-boomer magnet we tend to think it is. I'm lowering my estimates of that yet again. I think an 80's style recession has jumped from the 10% I was predicting earlier this year, to a 30%. I think the changes we'll escape without major damage has dropped from 20% to 10%. And it will be sheer luck.
Mostly, we'll muddle through. There is so much froth going on, that it may still be bubbling when a recovery begins. The commercial boom is going to cause some long-term problems, I believe, but it may just pull us through the worst of the housing bust.
I'm planning for lower sales. And watching it all with trepidation and awe.
Oh, I left out the city government. I think it was overwhelmed by the growth. We fired a competent city manager just when we needed him most, and for whatever reasons, the two city managers that followed didn't work out. They've made some bone-headed decisions, and there seems to be a snarled up mess in the bureaucracy.
The city council? Well, why would anyone run for such a thankless job? Nobless Oblige? Ego? To make connections? All of these motivations could lead to some pretty awful decision making. But we have no alternative, and paying them a living wage would just open up the process to other -- maybe worse -- problems.
I consider myself the outsider observer, for what it's worth. I don't have any inside knowledge. Just the viewpoint of a native Bendite who has run a business in Downtown Bend for the last 28 years. And who enjoys writing.
Wednesday, January 23, 2008
Subscribe to:
Post Comments (Atom)
5 comments:
Great post duncan, and you know I never say that.
Regarding the BULL & SORE, all I can say is that the road to hell is paved with good intentions.
You yourself have said that bubble's are irrational
I think what you seeing is the Irrationality overtake the Bubble, especially on the downside.
Good article today in the BULL about how "Cheap Homes are Bends Future". They have responded to your note of silence.
Regarding the BULL's demand for 'affordable homes', as BEM has said many times, "we don't have an affordable home problem here, rent is cheap, and has always been cheap".
For ever in Oregon, the solution to pollution is dilution. In Bend the solution to over-supply, is more-supply.
Rent's are going to get cheaper because over-supply tons of people have been hurt because 'homeowner-ship' is not the be-all.
Developers can now get cheap land, cheap material, and cheap labor, so they'll build. But will BUYER's BUY?? Today there are NO BUYERS, and most likely there will be no buyers for years, too many people have gotten hurt by home-ownership.
We managed to push it up to 70%, it has to go down, the real cost of housing when comparing renting to owning has a long way to go in Bend, before there is parity. Sure low income housing by definition will attract those less knowledgeable 'first time' naive, but having seen so many people burned why buy??
Also the quality of homes after 2002 in Bend went so low, one can only imagine the quality now. If Bend can build homes with an ask of $180k, and sell them for $150k, then you know that Redmond can ASK $120k, and sell for $100k, the bidding war has begun, the new home drive to zero. This is exactly how the 1980's RE drive to zero played.
On the west coast since mid 1990's it has been better to rent than to own, ignoring appreciation, which is now of course net-zero or worse. Thus in order for home-ownership to be as attractive as renting from a financial point of view, we need to get back to mid 1990's prices. Note also that income really isn't up, over the years.
I really think its going to be common 'oprah winfrey' type knowledge in the coming years, not to buy, buying a home has been a fools game for the past five years, and I think its going to take a awhile before people forget.
Note of course I'm all for home-ownership for those in the long haul, but the vast majority of people who came ( post 1998 ) didn't come for the long-haul, they came for the gold-rush, and its over, for a generation. Given that the gold-rush is over why buy? These crap-shacks out in Siberia aren't second homes for middle-class people they buy at Sunriver, Black-Butte,
Where are they going to get the suckers from? Perhaps it will all become "Walmart" housing, perhaps Walmart will start company towns?? It could happen.
I added some remarks about the city government, Bilbo.
In a way, my view is more damning than yours. You tend to think these guys actually know what they're doing.
I tend to think they're over their heads, and greedy and short-sighted.
They used to say that men go bad when honest men remain silent.
I Bend, the entire council has an interest in Selling Condo's. They're NOT going to piss in their own soup.
The question is why did the parasitic-amenity electorate vote them in? The reason, because everybody in Bend followed theory that what is good for 'condos' is good for them.
Now Condo's don't sell, and nobody on council looks bright or very healthy.
The boom days are over, but there's always money to be made in a bust, I too have been around forever, and the folks in RE that made the most money of their lives did so during the early 1980's REPO cycle, so history repeats itself, and will have a whole new flock of birds soon in city-hall enriching themselves.
So what, when you have a city where over 1/2 the homes are owned by non-resident's, who really cares?
What's always interesting about these irrational bubbles is that even the liberals go insane, not just the conservatives, a lot of our most liberal protectors of the environment here in Bend, have been silent for the past few election cycles, because they were getting rich,...
Now that everyone is getting POOR, all will come to their senses, and hopefully we'll have some kind of balance in city-hall so once again gridlock. ( thank god )
First step we got to do is force the actual cost of SDC on new crap-shacks, and get things fixed, before they pass the bill to us that never went insane.
I tend to think they're over their heads, and greedy and short-sighted.
*
When I go to council city or county meetings, I'm just amazed how young they all look. To me they all look like this is the first BULL in their lives, and this is the big one to get rich, they have no notion of history, they don't understand the cycles of Bend.
Where in the hell was the old guard during this shit?? When I was young and involved in politics I always had a flock of older mentors reminding me to keep the "Moral Highground", ... I always got my best ideas from those who had seen it all before, ...
What's happened in Bend in the last few years is like what happened in DOT-COM, youth took over and said, away with bricks&mortar, and got all kinds of money, and dot-com to the moon. Now everyone has lost all their money, and the young-kids running city-hall don't look so smart, in fact they all looking fucking idiots.
The same reason that people lost their retirement on DOT-COM, is the same reason they'll lose their retirement on DOT-BEND. Fools and their money always depart.
Ok, now what happens NOW, is yes back to our GOOD city-manager, these young WRONG morons, need to be fed a large dose of castor oil and/or resign, and some of the old guard has get involved and fix things, that said, my suspicion is that MOST of the old guard knows well that these bastards are going to drive all the property to zero, and there will be bargains galore.
I don't buy conspiracy either DUNCAN, but there is NOTABLE silence. I'm not going to BUY shit, because I already own TOO MUCH BEND REAL-ESTATE, I DON'T want to mo more, but my guess is a lot of the old timers let this group run the city into the ground with the very idea, of picking all back up cheap.
Perhaps you weren't involved in RE 30 years ago, I was, but like I said earlier, some of the best money ever made in the 1980's was doing REPO deals, I had friends making $1,000's/day, for years.
Yes! 1200 Words and only one F Word! I actually read the content this time :-)
Nice.
Post a Comment