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12-9-07 Approved subdivisions and lots and un-built houses and water commitments in Oconee

Will the cost of gas and traffic jams on GA 316 and I-20 permanently change commuting habits? Will folks continue to live long distances from their jobs? ........... Have our elected officials included such factors in their projections for debt service and more and larger facilities?

AVOC

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December 9, 2007

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Approved subdivisions and lots and un-built houses and water commitments

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By Wendell Dawson, Editor, AVOC, Inc

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An AJC article on December 1, 2007, caught my eye and reminded me of the hundreds of approved lots in Oconee County.  The article included the comment, “…it would take 40 months to build homes on all the vacant lots in the Atlanta region…”   How many lots are “approved in Oconee County”?   It would have to be in the hundreds, if not thousands!!

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Some Unsold Houses in Oconee – Late September 2007

Coldwater near Union Church and Off Cliff Dawson Road

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Lots with un-built Homes in Oconee County – Late September 2007

Hwy 53 near Briarwood Church; Coldwater near Union Church and Westland off US 78

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While unsold houses are now a problem, many un-built homes have been approved.    In many approved subdivisions have streets and “stubbed-out” lots for utilities.   It is obvious that water commitments have been bought and paid for in those developments.   One can assume that they are paying the monthly minimum on water for those ‘stub-outs”.   

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While the minimum monthly bill can provide revenue, it is not in the range that projections for growth, bonds and water source planning envisioned.   If Oconee had to start making monthly payments of $ 330,000 for the Hard Labor Creek any time soon, County Tax Funds would be needed.($ 66 Million for 3.5 MGD until 2030! With first water available no earlier than 2014).

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The drought and current housing market is graphically demonstrating the mistake of relying on continued wide open growth for sustaining the costs of such growth.   We have finite resources as to water.   We have 2007 traffic volumes on 1950’s era rural roads.   We have sprawling schools all over our rural landscape.   Will they be filled?

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Will the cost of gas and traffic jams on GA 316 and I-20 permanently change commuting habits?   Will folks continue to live long distances from their jobs?

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Have our elected officials included such factors in their projections for debt service and for more and larger facilities?

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Time and taxes will tell…..

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12-1-07 Un-built Homes can be problem for communities and local governments

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The Atlanta Journal-Constitution

http://www.ajc.com/opinion/content/opinion/bookman/stories/2007/11/28/bookmaned_1129.html

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December 1, 2007                     OP-ED

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Houses unbuilt, loans unpaid are trouble for region
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By Jay Bookman

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"We were never a bubble market," insists Eugene James, director of the Atlanta regional office of Metrostudy, a real estate research firm.

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While home prices in other parts of the country were jumping by unsustainable double-digit margins, James says, here in Atlanta they rose more steadily, in the range of 4 percent to 6 percent a year.

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While existing home prices hold steady, new-home construction has taken a real blow, with ramifications that will ripple through the region and could significantly alter how Atlanta grows.

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For example, the crunch is hitting hardest in exurban areas where thousands of lots sit vacant.Areas closer to the urban core are doing a little better, in part because people want to avoid long commutes.

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Overall, it would take 40 months to build homes on all the vacant lots in the Atlanta region, according to James — twice the normal inventory. That's consistent with a report from the Atlanta Regional Commission that development of open land in the metro area has fallen 70 percent in the last two years.

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The decline has even become apparent in our school systems, where classroom trailers have long been needed to handle the overflow of students. This year, when metro schools opened, enrollment fell 10,000 students short of projections.

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"Anybody tied to residential development — the carpet industry, the building supply industry, real estate attorneys — is feeling the impact of this," James says.

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The strain is being felt particularly in local banking, which has made handsome profits for years by financing developers and land speculation. Now, with lots sitting unsold, developers have a hard time making payments.

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"I understand there are quite a few banks in the metro area, and some in the rest of the state, that got too much into land development," says state Sen. Tommie Williams, a member of the Senate banking and finance committees.

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"Auditors are specifically asking banks what percentage of their loans are in speculative land development." (Williams, who sits on the board of a bank in Vidalia, says his own bank has avoided the problem.)

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That warning is echoed by a federal bank regulator, who told me that they've already seen "severe asset-quality problems emerge at several metro-area banks."

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"If the real estate market does not turn around soon," he says, "I think the problems could get really big."

In essence, a banking bubble of sorts has developed in Georgia.   As long as development boomed, there was a lot of money to be made by starting banks to finance growth, then selling those banks at a big profit. So many people rushed into the business that we may have become "overbanked," as Williams put it.

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12-8-07 Development slows down in Gwinnett County

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The Gwinnett Daily Post

http://www.gwinnettdailypost.com/main.asp?SectionID=6&SubSectionID=84&ArticleID=8162

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December 8, 2007

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Developers slow down in Gwinnett
Report: Development dropping in county
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By Christy Smith
Staff Writer
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ATLANTA - Developers are no longer gorging on Gwinnett County land, according to a report from the Atlanta Regional Commission.
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Development of Gwinnett County's agricultural and forested land has dropped by about 62 percent in the two-year period from 2005 to 2007 compared to the previous two-year period, said Mike Carnathan, ARC researcher.
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Development of green lands has dropped by 71 percent across the 13-county metro Atlanta area, the report said.
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Urban sprawl has slowed but has not halted.

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"Two main reasons for the decline are a decrease in housing construction - building permits are down 47.6 percent from last year - and an increase in redevelopment of existing areas or infill housing," Carnathan said. "Neither of these are unique to Gwinnett."……………………..


11-20-07 Large Metro Homebuilder lays off employees

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The Gwinnett Daily Post

http://www.gwinnettdailypost.com/main.asp?SectionID=42&SubSectionID=119&ArticleID=7305

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November 20, 2007

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John Wieland Homes lays off 59 workers
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From staff reports
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ATLANTA - Officials with Atlanta-based John Wieland Homes confirmed the company laid off 59 Atlanta-area workers this month. The cutbacks are due to pressure brought on by the current home-buying slump, said Jennifer Nilsson, company spokeswoman..
"We had to adjust our size to conform to the current market conditions," Nilsson said.
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John Wieland Homes operates 36 communities around metro Atlanta, according to its Web site. It is currently building Stonehaven at Sugarloaf, a 150-home clubhouse community in Lawrenceville where home prices hover in the $ 700,000 to $ 800,000 range.


11-23-07 Who's to blame for the mortgage mess?

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MSN Finance

http://articles.moneycentral.msn.com/Investing/CompanyFocus/WhosToBlameForTheMortgageMess.aspx

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November 15, 2007

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Who's to blame for the mortgage mess?

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By Michael Brush

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You know who the victims are.  We name some of the villains in a credit crunchbuilt on irresponsible subprime lending in the United States.

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It's not over, folks. There's plenty of pain left to come for homeowners and investors already battered and bruised by the subprime-mortgage meltdown.

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Consider that analyst Mike Mayo of Deutsche Bank predicted Monday that worldwide losses from bad subprime-mortgage loans will reach as much as $ 400 billion. To date, reported losses are less than a quarter of that total. And market strategist Ed Yardeni on Monday doubled the odds of recession in 2008, to 30%.

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But even if we don't know when it will end, we're getting a much better idea of whom to blame. It's a collection of regulators, Wall Street titans and too-smart number crunchers who were supposed to be providing adult supervision. Instead, they chose either to enrich themselves or to look away as others did………..

 


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