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The Grey Papers: Housing

May 19, 2010

So far the Grey Papers have discussed education, tourism, and the environment.  The latest edition is out, this time discussing housing.  Once again, things look bleak.  As always, I’m here to relay the message.

In January 2009, Guam Housing and Urban Renewal Authority (GHURA), at the request of the Civilian Military Task Force (CMTF), conducted the “Guam Comprehensive Housing Study”.  The aim of this study was twofold: 1) to produce a comprehensive housing study for Guam; and 2) to develop a dynamic, interactive housing model to generate housing need forecasts for Guam.

So what did they come up with?The predicted population increase from a military buildup will create an increase in demand for over 11,800 homes.  This does not include military personnel living on base or H-2B (one-time worker visa) workers.  While Guam’s housing industry produces between 400 and 1,000 units on average per year, the buildup would require over 9,000 units constructed by 2014 in order to meet the expected demand.

Currently, housing costs in Guam are at their highest point in history.  This cost will skyrocket with a shortage of labor, materials and homes on the island.  In turn, low to moderate income families will not be able to afford the costs to build, purchase or rent a home because of the higher prices.

Furthermore, if the demand for constructing new homes is actually met, the result would be an oversupply of housing after 2014 which will in turn drive prices down meaning substantial losses for landlords and developers that invest in the initial buildup. It would also cause a number of problems associated with maintaining large amounts of vacant units (think Detroit).

If you are keeping score at home, the further militarization of Guam would have devastating impacts on the following markets:

  • Education
  • Tourism
  • Environment
  • Housing

At this point the only advantage to the buildup would be strengthening our empire in the Pacific.  There are many that would consider this advantageous, but it’s not 1944.  We are no longer fighting Japan.  China is our ally.  So fortifying our presences in the Pacific is not worth the damage that would be inflicted on the island of Guam or its people.

What do you think?

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