The Unfinished Suburbs of America

Thousands of acres across the country were partially developed during the housing boom. What should happen to them now?

Alana Semuels

STOCKTON, Calif.—Janeen Milhorn and her husband bought their four-bedroom ranch-style house on a quiet street in this California suburb in 2004. It was on one of the farthest lots in the development, which Milhorn liked because it meant she had more land, and because it looked out onto a hay field.

But before long, developers snapped up that hay field, part of the real estate boom fueling speculation and building all over former farmland in parts of California and the West. In 2006, they started building, platting the land and paving roads. They erected street lights and electrical cables and installed street signs with rock star names like Jagger Lane and Hendrix Drive.

Then the recession hit, and building stopped. The streets and the sidewalks were still there, as were the lots, with red and black electrical wires sticking out of the ground. But only a few houses had been completed. None were anywhere near the Milhorn's house. Out of one window, the Milhorns could see the manicured lawns and bright gardens of their neighbors in the completed development. Out of the other, they saw a bleak field with street signs and lamp posts, but no houses.

That field soon began to look like a garbage dump. There were overgrown weeds, beer bottles, shopping carts. Discarded children's toys and car seats and plastic bags. People from all over town would come to get rid of their old mattresses or party at night. Coyotes and skunks found the open space appealing too. Sometimes, Milhorn would come home from working a night shift and find a skunk sitting in her yard.

“It’s kind of horrible,” Milhorn said, standing in her front yard, staring out onto the abandoned development next door, as a man on a motorcycle gunned his engine, speeding in noisy circles around the empty streets.

Milhorn and her husband erected a fence on their property’s boundary to keep out the animals, but that doesn’t stop the people who come in to cruise around the empty streets or party in the tall grass. A road block that had been erected to keep out trespassers was taken down after a drunk driver rammed into it in the dark. Now, the empty streets of the cul-de-sac have turned into a track for drag racers and bikers.

“One of them bit the dust in the middle of the night and was screaming out here in the dark,” Milhorn said, shaking her head.

There are hundreds of zombie subdivisions like this one scattered across the country. They're one of the most visible reminders of the housing boom and bust, planned and paved in the heady days where it seemed that everybody wanted a home in the suburbs, and could afford it, too. But when the economy tanked, many of the developers behind these subdivisions went belly-up, and construction stopped. In some cases, a few people have moved into homes in these half-built subdivisions, requiring services to be delivered there. In others, the land is empty, except for roads, sidewalks, and the few street signs that haven't been stolen yet. In some counties in the West, anywhere from 15 to 33 percent of all subdivision lots are vacant, according to the Sonoran Institute.

The sidewalk near Janeen Milhorn's house is littered with trash. (Alana Semuels)

“Since the post-2007 real estate bust, which hit many parts of the region severely, eroding subdivision roads now slice through farmland and open space, and 'spec' houses stand alone amid many rural and suburban landscapes,” author Jim Holway wrote in a report by the Lincoln Institute of Land Policy about zombie subdivisions. “Without correction, they will continue to weaken fiscal health, property values and quality of life in affected communities.”

Empty lots can cause wildfires and flooding contamination, and can bring down the property values of nearby homes. They can also cost local governments money that they don't necessarily have, since the municipalities may have to provide public safety or snow removal to far-flung areas, without the benefit of the property taxes that had been expected.

It's unclear just how to 'fix' these zombie subdivisions. While some will be completed as the economy recovers, others may lie dormant for a long time. That’s especially true now that many young people and boomers want to live in walkable, urban environments, rather than subdivisions where they have to drive to everything.

But if roads have been paved or a developer has installed infrastructure improvements, it’s very hard to just revert the space back to farmland. Local governments who try to stop building—even if there is little demand—can be sued for preventing development where it had once been approved.

"When things are zoned for future residential development, there's value in that," said June Williamson, an architecture professor at The City College of New York who co-wrote a book called Retrofitting Suburbia.  "Landowners can argue that downsizing will lead to a less profitable future use."

Still, some developers  have come up with creative ways to turn zombie subdivisions into something other than rows upon rows of empty McMansions.

Maricopa, Arizona, for instance, had issued about 600 residential building permits a month during the boom, and then saw many of these developments stall. Rather than just wait to see if demand would ever return, the city hooked up a Catholic church with the owners of an empty development. The church had been looking to erect a new building, and was searching for a site with existing water and infrastructure services. The developer had been looking for someone willing to build. With a little bit of rezoning help from the city, the church could start building on the land.

This house was the last developed in a planned community in Stockton. (Alana Semuels)

And in Teton County, Idaho, population around 11,000, where the Sonoran Institute estimates that 68 percent of land parceled into subdivisions was undeveloped, local officials passed ordinances that would allow subdivisions to be rezoned. One development, called Canyon Creek Ranch, changed its plans from a resort with 350 lots to a community project with only 21 lots, shrinking the infrastructure price tag by 97 percent and reducing the environmental impacts.

Michael Mehaffy, an urban developer and consultant, said that recently, clients who bought distressed properties have started to contact him, hoping to start building on them again. But they want to build something different than was planned before.

“The market is shifting—people are recognizing that they don’t want to live in these monocultural places,” he said. “They want to be able to walk, enjoy amenities and a nice neighborhood with lots of services nearby.”

But there are zoning codes and headaches that make it difficult to build something different than was originally planned, Mehaffy said. Some of these developments don’t have any available public transit. Others may have residents who bought houses thinking they were moving into a suburb, and might oppose apartment buildings or retail. Some planned communities already have certain entitlements to water and other resources they don't want to give up if they build smaller projects than originally planned.

“It can be difficult if you’re trying, as we are, not just to pick up the pieces and build again, but build in a smarter way, a complete community,” he said.

But in some places, it’s working. Mehaffy is working with Lawrence Qamar, an architect and urban designer, on a zombie subdivision in coastal Washington state in an area called Ocean Shores. The project was initially envisioned as a dozen four-story condo buildings. Though one building was completed and a few units were sold, the project stalled during the recession. A new developer bought the property in auction in 2012.

“They had a really terrible plan, an awful development that would have been a blight on the landscape if it had been built,” said Qamar.

Now, Mehaffy and Qamar have a new vision: A mixed-use, walkable neighborhood with small single-family detached cottages, retail and bike paths. The old plan would have had 500 condo units, the new one has up to 300 cottage-style spaces or “residential units.”

“We want to transform this zombie subdivision into something more similar to this village-like vision,” Qamar said.

Back in Janeen Milhorn’s development, there’s no sign that anyone is thinking of building something more walkable. There are some new homes going up down the street on Petty Lane, next to the ones already built on Zeppelin Lane and Ozzy Ct. But the land near hers is owned by a different builder, and they’re just letting it sit, she said. She and her husband tried to contact the city to see if they could buy some of the land and make their yard bigger, but the city said no. A house is going to go there eventually, the city said. Until then, Milhorn is just going to have to wait.