From the NY Times today

The Heart of Teardown Country
New York Times - By CARIN RUBENSTEIN
Published: December 16, 2007
HAVE you ever lived near a teardown in progress? Has it ever been your daily fate to deal with noise, smells, dirt and construction crews right next door — only to behold, after endless months, a space-hogging “mansionization” in place of the petite Cape Cod you used to find so sweet?

If not, your turn may come sooner than you think. Despite the overall problems troubling the nation’s real estate market, the New York metropolitan region has now surpassed Chicago, the former record holder, to become the teardown capital of the United States, according to a recent report by the National Trust for Historic Preservation, which has been tracking the phenomenon since 2002. ...

On Speculation:

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.

Tensions and Solutions?

After watching the razing of several older houses in the hamlet of Oyster Bay, on Long Island, irate residents formed a group they called Save the Jewel by the Bay. It was instrumental in instituting an 18-month moratorium on both demolitions and new construction, which ended in June, said Kathryn Prinz, a founder. Now anyone planning to demolish a house built more than 50 years ago must appear before a review board to get permission.

Gordon F. Joseloff, the founder of a Connecticut online newspaper called westportnow.com, riled residents two years ago when he instituted a feature called Teardown of the Day. It includes a photograph of a property newly proposed for demolition, as well as the address, the listing details and the sale price.

Mr. Joseloff, who has since been elected Westport’s first selectman (the equivalent of mayor), believes that his site’s exposure of teardown properties was what persuaded the town’s Planning and Zoning Commission to impose a 90-day waiting period on such projects. In addition, the town has hired a land-use consulting firm to help develop laws to regulate the size of new houses. . . .

But neighbors can be equally vociferous in their support of teardowns. Mr. Joseloff says that he has fielded angry calls from Westport residents who accuse him of “messing with their nest egg” by imposing size restrictions that will ultimately damage their ability to reap a substantial profit from the sale of their homes.

Frank J. Mottola Jr., the Building Department’s director and the zoning officer for the Borough of Tenafly, N.J., said, “Neighborhood groups spring up only when we attempt to curtail the use of land in their area.” He receives several teardown applications each month, he said, and almost every one is for a much larger home.

“Our Planning Board grappled with this, to put a limit on the new construction so it doesn’t appear out of scale for the neighborhood,” he explained. But, he added, “people look at their home as more of an investment than they used to, and they don’t want their development rights curtailed.”

A good article, well worth the reading -- with an open mind. It should help identify the tensions and trends.