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Do-gooder had good timing on housing boom


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    Southern California’s Inland Empire has the second-highest unemployment in the country for a metropolitan area with more than 1 million people -- 13.4 percent (September 2011). Only Las Vegas is higher. Job loss and the housing crash have devastated retailers on this commercial strip in Fontana, Calif.

    - Mitchell Hartman/Marketplace

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    Entering the struggling city of Rialto, population 100,000, along Route 66 from San Bernardino, its depressed neighbor to the east. Rialto’s population—which is predominantly Hispanic—grew 36 percent from 1990-2010.

    - Mitchell Hartman/Marketplace

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    The city of Rialto just turned 100 this month, but it’s not in a celebratory mood. Unemployment is over 16 percent, home prices have fallen by 65 percent and sales tax revenues have fallen, causing the city to trim its workforce by approximately 20 percent since the recession began.

    - Mitchell Hartman/Marketplace

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    In the Inland Empire, 45 percent of homes are underwater. Home prices fell 6.3 percent in the latest year (September 2010-2011), the 4th-largest drop for a large metro area. The region has had the third-most foreclosures in the nation (after Phoenix and Atlanta) since 2005.

    - Mitchell Hartman/Marketplace

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    A sign in downtown Rialto announces new homes but few are being built right now. Two planned developments are being stretched out over the next 10 to 20 years.

    - Mitchell Hartman/Marketplace

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    Downtown Rialto is a patchwork of shuttered shops and those still hanging on.

    - Mitchell Hartman/Marketplace

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    At the Patio West Deli in downtown Rialto, owners Claudia Szypusz and Gloria Miller say this is the slowest business has been in the last 30 years. But they believe the worst is now behind them and the economy has bottomed out.

    - Mitchell Hartman/Marketplace

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    With home construction in the Inland Empire at a standstill, public construction projects—some supported with federal stimulus funds—are among the only ones still active. This fire station project is in Fontana, Calif.

    - Mitchell Hartman/Marketplace

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    Rialto assistant city administrator Robb Steel says the city has tried hard to attract industrial jobs and employers, including logistics facilities that truck and warehouse imports from the Ports of Los Angeles to discount stores and malls nationwide.

    - Mitchell Hartman/Marketplace

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    Rialto is home to a huge FedEx logistics center. Warehouse vacancy rates rose to 20% in Rialto during the recession but they are now below 10% as global trade and consumer spending rebound. The typical logistics facility is 1.5 million square feet. Employment in logistics grew by 45 percent from 1990-2010. Much of the hiring is through temporary staffing agencies.

    - Mitchell Hartman/Marketplace

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    A new state-of-the-art logistics center for Sketchers has just opened in Moreno Valley. It will employ fewer workers than a typical warehouse—mostly highly-paid computer operators and technicians. The 1.8 million-square-foot facility cost $250 million dollars to build and employs the latest environmental and energy-saving technology.

    - Mitchell Hartman/Marketplace

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    One of the largest industrial employers in the Inland Empire, California Steel in Fontana has 1,000 highly-skilled workers. It plans to hire 50 more next year. The business is currently being driven by domestic demand in the gas and solar industries.

    - Mitchell Hartman/Marketplace

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    Unskilled workers—many of them undocumented—offer themselves as day-laborers outside a Home Depot in Riverside. Many low-wage workers laid off from warehousing and construction have moved into day-labor during the recession.

    - Mitchell Hartman/Marketplace

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    Sunrise Church in Rialto has boomed in recent decades as the city’s black and Hispanic population expanded. It now has 5,000 members and occupies a 13-acre campus including two large auditoriums, classrooms, offices, and playing fields.

    - Mitchell Hartman/Marketplace

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    Sunrise Church Senior Pastor Jay Pankratz preaches two sermons every Sunday flanked by an electric gospel band and huge video screens. In an adjacent auditorium, Spanish-language services are held.

    - Mitchell Hartman/Marketplace

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    Several miles from Sunrise Church, in a poor section of Rialto, is the Sunrise Mission. Church members volunteer to give out donated food and clothing to the needy on Sundays.

    - Mitchell Hartman/Marketplace

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    Sunrise Church member Albert Grigsby, who is retired from the military, supervises food distribution at the relief mission.

    - Mitchell Hartman/Marketplace

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    The historic Mission Inn in downtown Riverside reminds visitors of the opulence and prosperity of the Inland Empire in former times, when agriculture and a succession of housing booms made fortunes—for some.

    - Mitchell Hartman/Marketplace

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    In the High-Desert community of Victorville, single-family homes are going for a fraction of the prices during the housing boom of the mid-2000s. With foreclosures and short-sales rampant, it’s a buyer’s market.

    - Mitchell Hartman/Marketplace

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    As housing boomed in the Inland Empire during the 2000s, prices also rose further east across the mountain passes in High Desert communities such as Victorville. There’s still land available for development, but little demand for new houses now.

    - Mitchell Hartman/Marketplace

Steve Chiotakis: In about an hour and a half, we'll get the number of people seeking first-time unemployment benefits. The jobless rate remains at more than 17 percent in San Bernardino, Calif. where a shredded housing market has cost thousands of construction jobs. Foreclosures are super high.

But Marketplace's Mitchell Hartman found one social services provider whose savvy home-buying
a decade ago, is now offering shelter from the storm.


Mitchell Hartman: I met Kim Carter at a forum on poverty and joblessness, which are especially high among blacks and Hispanics in Southern California's Inland Empire. Carter is a dynamo: A former addict and ex-convict, 10 years ago she founded the Time for Change Foundation in her native San Bernardino to help other women get back on their feet.

Kim Carter: We have two facilities, we serve over 50 women per year, we house them and their children and provide them with case management, family reunification, parenting.

Hartman: And those are group houses that you have?

Carter: They're actually homes -- single-family homes -- and residents live as extended family.

Hartman: So you bought the houses yourself?

Carter: Exactly.

Hartman: And what did you pay for them?

Carter: Well, back in 2002, the houses were like, you know, $80,000 and $90,000, so I was able to get a really, really good deal. Fortunately for us, we didn't do all that re-fi stuff that people were doing when the housing prices went up, so we're still back to where we were when we started.

Buying before the housing bubble really inflated, then avoiding the subprime loans that targeted so many minority homeowners -- all pretty smart. But with her prison record, how could she buy at all?

Carter: See, when you're looking for a job or you're looking for rental assistance, those applications will ask you about your background, whether you've had a past felony conviction or not. But when you're getting ready to fill out for a home loan, they don't ask that question.

Her two homeless shelters are in well-kept middle class neighborhoods that were spared the worst of the predatory lending that led to the foreclosure crash. But Carter says her neighbors haven't been so keen on her efforts.

Carter: Actually, society would rather have a facility closed and abandoned than to allow homeless women to get into it, despite the fact that there are a lot of foreclosed properties.

And with so many of those foreclosed properties on the market cheap right now, Carter might just be tempted to buy another suburban ranch house to shelter homeless women. She says there are plenty who need it.

I'm Mitchell Hartman for Marketplace.

About the author

Mitchell Hartman is the senior reporter for Marketplace’s Entrepreneurship Desk and also covers employment.

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