(From June 1994) MOAB’S PORK BELLY HOUSING BOOM…by Jim Stiles

2018 PROLOGUE: My worries about housing prices in Moab and my community’s future, back in 1994, seem almost quaint when placed in today’s context. But this was the beginning of the change, the transformation–the transmogrification— that put Moab on a road to what it has become. And note my naive enthusiasm for Al Gore…I actually believed he was sincere when he wrote those words, back in 1992…Times change…JS

“I believe that our civilization is addicted to the consumption of the earth itself…our industrial civilization makes us a promise: the pursuit of happiness and comfort is paramount, and the consumption of an endless stream of new products is encouraged as the best way  to succeed in that pursuit. But the promise is always false because the hunger for authenticity remains.”

                   –Al Gore, Earth in the Balance 

Here in Southeast Utah, the latest “shiny new product” is the land itself, marketed and packaged for the consumer to obliterate. The Great Housing Boom in Moab is on, fueled by the mega-bucks of out-of-towners who need to re-invest their millions to avoid capital gains taxes, or because they just don’t have anything better to do with their money (or their lives).

Every time I turn around, I hear about another proposed subdivision development, with prices beginning in excess of $100,000. Alfala fields and cow pastures that I have known for years are suddenly adorned with survey stakes and day-glo ribbon. What exactly is happening to Grand County? Before I try to put my own spin on it, it might be helpful to go back a few years and follow the events that brought us here.

In 1985, I bought my one and only home on Locust Lane. At the time, according to most of the real estate agents who were here then, almost a quarter of the homes in Grand County were empty, and no one particularly wanted them. The energy boom in SE Utah had gone bust for the last time, according to many and the idea of Moab becoming a latter day ghost town didn’t seem so farfetched. The bank owned the house that I eventually bought. They wanted $23,000, I offered $18,000 with a measly $2,000 down payment, and they accepted the offer the same day. When I filled out my loan application, I was a seasonal ranger with a yearly salary less than $10,000. My realtor told me to list my unemployment compensation as income. What the hell, I thought. There’s no way this loan is going to be accepted anyway. They approved it the next day.

As the biking boom exploded in Moab, and more affluent tourists from places like Aspen and Park City and Telluride and West Coast cities “discovered” our depressed little town, they also discovered our dirt-cheap housing market. Local realtors still seethe over the often heard refrain in 1989…”What can we steal today?” from the mouths of these wealthy visitors. It was not uncommon to see an out-of-towner buy four homes in a day, and still keep the bill under $100,000, about the cost of a new garage in Aspen.

By 1991, all those empty houses of 1985 had been purchased, if not occupied, for many of them became vacation homes and speculative properties for many of the buyers. For the word was out: Moab was the new hip, cool place to be. It’s now…it’s WOW, it’s a 90s kind of happening place (dude). Feature stories in newspapers and magazines across the country began to feature Moab. From the Wall Street Journal and The New York Times to Newsweek and Time. We were identified as one of the best small towns in the West in which to invest.

And the investors came.

Now to be fair, most of the people who heard about Moab and made their way here, came to start a business and have a life. Realistically, most of the businesses that have appeared in the last few years have been in response to the tourist boom. Whether you or I like it or not doesn’t matter…the fact that this plethora of new shops and stores responds to the needs or wants of the tourist is at least logical. Supply and demand. Demand and supply.

But the housing market makes no sense at all. My $18,000 house is now worth, according to some realtors, as much as $90,000. And the prices continue to escalate at a shocking rate. And obviously, people who paid $50,000 for a home eight or ten years ago are now in possession of property worth almost $200,000.

Why? Is it the old Law of Supply and Demand again? Are there so many people in need of a house and so few available that those remaining homes on the market have become worth their weight in gold?

Not really. There is a great demand for housing in Moab. The dozens of new restaurants and motels and bars and shops require employees to run them…waiters, waitresses, cooks, dishwashers, maids, clerks. All of these people, hundreds of them, are looking for a place to live. But there simply is not much available. Apartments that were rented on a monthly basis just a few short years ago, have been converted to provide overnight accommodations to tourists. There is a sizable portion of Moab’s work force that are sleeping in their cars, or camped out in a friend’s back yard because they cannot find an affordable place to rent.

But there is a housing boom underway in Moab. For whom are these houses being built? Why are these houses being built? What is the point of all this frenzied new housing construction?

    

I call it a pork belly market that is fueled by several years of media hype. Like I said, it’s now, it’s wow. People from across the country are showing up in Moab, their pockets brimming with bucks, almost desperately searching for ways to empty them. They are willing to pay any price because they have been told it’s worth every penny. Who is developing these subdivisions? For the most part, out-of-town investors. Who is buying up the lots in these subdivisions? For the most part, out-of-town investors. How many of them plan to live here? I couldn’t tell you.

For many of the big money investors, buying land in Grand County seems more like a way to pass the time than anything else. Entertainment on a grand scale. And I have to wonder: Why would anyone with the kind of net worth we’re seeing want to buy ranches and other large pieces of property and then subdivide them? They don’t need the money. They are the owners of some of the most beautiful land on the planet. What would any of us give to be able to sit on the front porch of one of these rapidly disappearing treasures and watch the light filter through the cottonwoods, the clouds drift across the desert sky…to just watch the world go by? To feel utterly content.  Are their lives so empty, so devoid of substance, that only money and its ability to buy power and control bring any satisfaction? I don’t know.

But I can tell you this; the big dollar purchases are fueling a speculative market that continues to drive up prices because each new buyer is convinced that the market will never slow down. (Shades of 1929?) That, if anything, the rate of increase in the cost of Grand County property will grow even faster.

But it’s that kind of pork belly futures market that also continues to drive property taxes higher and higher. Some of my friends shrug when I complain about the speculative nature of the housing boom. “Hey,” they say, “we’re no different from Telluride or Aspen or Jackson…it happened there and it’ll happen here.”

But actually, we are different from Telluride or Aspen. We’re a lot different. First of all, we’re a larger community than either Colorado town was before they underwent the Big Conversion from an Old West town to a New West town. But more important, we’re a much more diverse community. Developers were able to buy up most of Telluride without much fuss; while it appears some of us are rolling over and playing tricks for the man or woman who can stuff the biggest wad of cash in our pockets, there are a great number of residents who still want to spend the rest of their lives here and for the same reasons that they came here. Quality of Life.

And we’re, let’s face it, an uglier community in the traditional sense of the word than some of those disgustingly cute little ski towns. No matter where one builds a dream home in this county, the nearest junk car is never very far. Frankly, I think we’re a more honest community as a result. There’s nothing artificially charming, no contrived quaintness about this place. And it would be quite an expensive task for the rich man on the hill to clean up his or her “view-shed,” no matter how much money he had.

And so, to live here, to really put down roots in this town, you’ve gotta love the place, warts and all. We’re not the most hospitable place in the West, from a climatic perspective, if nothing else. And that’s where another breakdown appears when we try to compare Moab to the tourist ski towns. Consider Telluride. Its well-developed ski industry runs profitably (most years) from mid-November to late March. And from the first of June to the middle of September, the weather is glorious…the tourists’ delight.

And Moab? While we got off easy last winter, we can all remember 1992 with its month long inversions and fog, zero temperatures, and snow that stayed on the ground until late February. During the six to eight weeks in the Spring when the weather is usually friendly, there are so many others fighting for the same rays of sun, the positive aspects of the good weather seem questionable. By late May, like now, the thermometer is pushing toward the 100 degree mark, the bugs are out, and the wind is blowing fine particles of sand into the sweaty faces of anyone dumb enough to expose themselves to it. The heat breaks in late September or early October. Then a repeat on the six weeks of nice weather and hordes of humans. Ditto on the return to winter.

My point is, while Telluride enjoys seven to eight months of the kind of weather that one type or another enjoys, Moab is blessed with maybe 90 days of weather that doesn’t make  tourists complain. I listened to tourists grumble about the weather for ten years at Arches National Park. Temperatures above 90 and below 50 degrees, and wind above 15 mph are all frowned upon by most visitors to the area. The last time that a day passed without any of those three criteria happening was around the time of Julius Caesar.  But then who was here to record it?    

So again, I ask the question: Why would anybody in their right mind pay the kind of prices that are being asked down here? The answer? For the third time, because we’re cool (even when it’s 106 in the shade).

Will it last? Probably. But at least one developer in town is not so sure. (And of course since no developer wants to be known as someone who thinks the boom will ever end, he remains anonymous) But he argues that speculative land rushes have gone bust before and this town just may be on the verge of seriously overbuilding. The result could be an implosion of sorts, with collapsing prices and a glut of empty homes.

But there I go being an optimist. There are so many rich people these days eager to invest and unconcerned about the impacts their money makes on the social fabric of the community, I’m probably dreaming when I think this madness might wither and fade away.

One thing is certain though. Those who have decided to invest here have sure created a nightmare for those of us who want to live our lives here.

 

Jim Stiles is Founder and Co-Publisher of the Canyon Country Zephyr.