Teardown central? Not any more…

For once, it’s nice to be the Second City. New York has surpassed Chicago as the teardown capital of the nation, according to the National Trust for Historic Preservation, and the Big Apple’s namesake daily newspaper has a superb look at the economics (and controversy) behind demolition.

It is the size of the profit margins required by speculators that has caused some to opt out, said Daniel McMillen, a professor of economics at the University of Illinois at Chicago who has conducted a financial analysis of teardowns in the Chicago area. Builders like to sell for two or three times the original price, he said, so “the slowdown in the housing market will slow teardowns being done on speculation.”

But regardless of how quickly a teardown project goes or how much money the rebuild sells for, the neighbors always take notice. Some will probably be up in arms about a spate of demolitions destroying the character of their community; others will be delighted at the prospects that the new construction will increase their own property values.

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