Boomed Out
The Pensacola News Journal. “The recession has dealt a whopping blow to Florida. Unemployment is soaring. The state is second to California in the number of foreclosures. Earlier this month came the most jaw-dropping announcement of all: The state that had made population growth the linchpin of its economy for more than 60 years lost a net 58,000 people in the 12 months ending April 1. ‘It’s the end of an era,’ says Robert Lang, director of the Metropolitan Institute at Virginia Tech. ‘Florida represents an entire postwar vision of the good life, palm trees, low cost and no taxes, just easy living. They could turn it around, but in the short haul, it’s paradise lost.’”
“‘The time is long past when Florida’s economy can be based on waiting at the Welcome Center with a glass of free orange juice and a real estate map,’ says state Sen. Don Gaetz, R-Crestview. ‘We have to do far better than that. We are learning a great deal from the difficulties we’re undergoing.’”
The Herald Tribune. “During the real estate boom, Marc and Erica Ayala began promising careers. When they were still in their 20s, just a few years out of Bayshore High School, she sold homes and condos while he became a construction superintendent. Then the boom went bust and their jobs disappeared. Now Marc works as a cable TV installer, while Erica studies to become a dental assistant.”
“‘This is a big change,’ said Erica, 29. ‘We’re cutting back, downsizing from two cars to one, moving from a house to an apartment.’”
“Their egos were bruised along with their pocketbooks. ‘It was all on the upside and then, all of a sudden, it was like the world just stopped,’ said Marc, 31. ‘I had to put my pride on the side.’”
The Orlando Sentinel. “Sylvia Roig, a 38-year-old single mom, lived in Buenaventura Lakes for nine years. An accountant, she became a mortgage broker six years ago in order to work from home and spend more time with her two young children. When the housing market went bust, she struggled to keep a roof over their head.”
“In April, Roig rented out her BVL home and moved in with her 84-year-old grandmother, who lived alone in her three-bedroom home in Arecibo. She’s been freelancing as an accountant and has started a home-based cake-making business. She wants to return to Central Florida if things here improve. ‘Schools are better [in Central Florida] than here, government agencies are not so chaotic and crime is not such a big worry,’ Roig said. ‘But right now, it’s about keeping our heads above water.’”
The Las Vegas Sun. “Nevada ranks third in the nation in unemployment, with Clark County feeling the bulk of the pain. The jobless rate here is more than 13 percent. Two decades of explosive growth have slammed to a halt and the region is reeling. The consensus among workers is clear: Las Vegas, as they put it, is ‘boomed out.’”
“Steve Ross, head of the Southern Nevada Building and Construction Trades Council, acknowledged the slowing economy has caught workers off guard. ‘Las Vegas is not like other cities. The boom has gone on so long, for so many years, that we’ve gotten very used to that,’ he said. ‘We have been spoiled here.’”
“Construction workers, in particular, see a dim future here. Jennifer Todd, an ironworker steward at CityCenter, is supporting a family of five on her salary. Her husband, James Brunty, was laid off at Fontainebleau in October and hasn’t been able to find work since — here or elsewhere. The couple bought a house last year and are struggling to pay the mortgage.”
“‘People are losing their houses,’ Todd said. ‘They can’t pay their bills. And if they’re lucky enough to have a job, there’s daily worry about layoffs.’”
The East Valley Tribune. “As the nation’s unemployment rate hits a more than quarter-century high of 9.7 percent, a top Arizona labor union leader expressed concern that the recession hasn’t bottomed out quite yet in the state. ‘It’s rough out there and it’s across the board,’ said Rebekah Friend, executive director of Arizona AFL-CIO. ‘We hear of people whose wages are already low and then for them to be forced to take one day a month off or a week off unpaid puts them in a downward spiral.’”
“The future in Luiz Zepeda’s eyes looks pretty grim. The 44-year-old Gilbert resident, a merchandise stocker at Target, used to work 50 to 60 hours, but is now down to 32 hours a week. He’s making about $300 less a month these days. On top of that, his wife, a hairstylist, also is making about that much less.”
“Zepeda was one of those whose adjustable rate mortgage loans more than doubled when the economy dipped, going from $866 to $1,966. He’s trying to modify his home loan right now, to lower the mortgage. He hasn’t made a house payment in two months.”
Zepeda was one of those whose adjustable rate mortgage loans more than doubled when the economy dipped, going from $866 to $1,966. He said he’d invested the money he saved because of the lower initial payments. But to take that out right now would mean being forced to pay about $2,000 in fees, which is just not worth it. He’s considering taking on another part-time job.”
“‘We’ve used up our savings,’ he said. ‘I’m hoping the loan modification works, but if it doesn’t, you gotta do what you gotta do.’”
The Ventura County Star. “On Labor Day 2009, what Californians need most is a lot more labor. In its annual report on the state of working Californians, released today, the nonpartisan California Budget Project reports the job losses suffered during what is being called the ‘Great Recession’ wiped out all the gains of the previous recovery and that the total number of jobs in the state is now roughly what it was nine years ago when there were 3.3 million fewer working-age adults.”
“California has been hit more severely by the recession than most states — its unemployment rate is now the fourth-highest in the nation — and the reason, the report says, is the state is paying the price for a housing market that was hyper-inflated before the real estate bust. Job losses since the beginning of the recession have been most severe in the housing sector. Employment in the construction industry is down nearly 30 percent, and jobs in financial services associated with mortgages, escrows and other housing-related transactions are off 11 percent.”
“‘During the last recovery, housing and housing-related industries contributed about 60 percent of the job growth,’ said Executive Director Jean Ross. ‘Housing during the early years of this decade just drove the California economy. It is hard to overstate the importance of housing over the last decade.’”
The Desert Sun. “Sandi Lott has tried to retire — several times. After 30 years as a real estate agent, Lott said she retired as she approached age 60 but soon went into the network-marketing business before trying to retire again. Now, the 74-year-old Palm Springs resident works part-time as the Mizell Senior Center’s volunteer coordinator and front desk manager.”
“‘While I’m a published writer, staying home and writing, I was going to the malls and spending money that wasn’t coming in,’ she said. ‘I wasn’t staying busy enough.’”
From Fox 40. “A report found that two of five working-age Californians do not have a job, underscoring the challenges in one of the toughest job markets in decades. The last time employment levels among this group were this low was February 1977, according to a study by the California Budget Project. Stephen Levy, director and senior economist for the Center for Continuing Study of the California Economy, said what’s different this Labor Day is that it’s not just the unemployed who are worried. There also is widespread fear and unease among those who still have jobs.”
“‘It’s a very disappointing Labor Day weekend,’ said Levy, who is not connected to the report by the California Budget Project. ‘We have record unemployment. But more than that, people who still have a job have seen their home values and retirement savings decrease.’”
The Modesto Bee. “With the unemployment rate hovering in the high teens in most valley counties, economic forecasters can offer only cold comfort with predictions of several more months of job losses before the trend starts to gradually turn around. ‘I think a year from now we’re going to be talking about unemployment rates similar to what we have now,’ said Jeff Michael, director of the Business Forecasting Center at the University of the Pacific. ‘In terms of really getting back to where we were before the recession, we’re looking at years — maybe 2013, 2014.’”
“‘One position I applied for had 140 applicants and I’m finding that typical wherever I go,’ said Ceres resident Mike Martin, while looking for work at a recent Modesto job fair. ‘It’s really frustrating. I look at the stock market and I see some things recovering. But from a grass-roots level, I don’t see any recovery yet.’”
“Michael, with UOP’s Business Forecasting Center, said the region could be burdened with double-digit unemployment for five years. He said any indicators of recovery will come from signs of stabilization in the housing market, slowdowns of store closures, loosening of credits market and increases in consumer confidence.”
“While painful, Michael said, this recession may alter personal and corporate spending habits to such an extent as to prevent another boom-and-bust recession of this magnitude. ‘In some ways, this is making things more normal,’ he said. ‘We had almost a 15-year erosion of savings and more spending. … So some of this is healthy. We want a recovery that is sustainable and not one that is artificially propped up by a new, nonsustainable thing.’”
The Press Democrat. “He had his own Boeing 737 jet, a $385,000 Mercedes-Benz, homes in Hawaii and a $16 million estate being built on a hill in Santa Rosa’s exclusive Shiloh Ridge neighborhood — all by the time he was 45. Robert W. O’Neel III was living large, brokering real estate deals across two continents with the financial backing of Wall Street and from Sonoma County lenders, including a $3.5 million loan from Clem Carinalli, the county’s largest individual landowner. And then about two years ago, it all began to fall apart.”
“As a result of hubris, the collapse of the financial markets or some combination of both, O’Neel’s empire is in ruins, with his partially built dream estate overlooking the Mayacama Golf Club wrapped in protective seal and abandoned.”
“‘I crashed and burned,’ O’Neel, 46, said recently while seated in the conference room of his attorney’s office in downtown Santa Rosa. ‘I can’t blame anybody but myself. Why did I start that house? Why didn’t I wait until a certain … You know, I can look back at all kinds of things and say I never should have done it. But I can’t. Those were decisions I made at the time.’”
The Union. “He watched the housing market ebb and flow, cresting sometime in 2006, when the median price for a Nevada County home topped at $465,000. Scott Stephan simply wanted to stay close to home. But the 35-year-old heating and air conditioning project manager knew that he would have to wait for the housing market to cool before he could turn up the heat on his own effort to buy a house.”
“He was going through a divorce when prices were at their zenith, which complicated matters, he said. ‘I thought for sure we’d never be able to buy a home in Nevada County,’ said Stephan. ‘But eventually, the timing was right and the prices were cheap.’”
“In April, Stephan married Delia. In June, the couple and Stephan’s two young children moved into a $250,000, three-bedroom, two-bath home on five acres in Rough and Ready, not far from his parents. Though Stephan pays about $550 more a month for a mortgage, the home and patch of land are his. The home, which Stephan said he believes was rebuilt after the devastating 49er Fire in 1988, needs some new windows, siding and ventilation upgrades, which he will pay for with the $8,000 federal tax credit.”
“‘I just wanted to have my own house, so I can do whatever I want, whenever I want,’ he said.”
“That’s part of the appeal, Stephan said — making the house his own. He pays more than he did to rent a place, but there’s nothing like coming home to a place that’s yours, he said. ‘We made some budget adjustments and didn’t even notice the difference,’ said Stephan, who has an $1,800 monthly mortgage payment. ‘As long as you have decent credit and you know your job is stable, you have nothing to lose.’”
