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Kansas City News Today Kansas City Front Page is a weekly news publication, with daily updates, spotlighting attractions, events, business and hospitality in Kansas City. |
KANSAS CITY NEWS TODAY - Sunday, June 28, 2009  Proposed Schlitterbahn Vacation Village Will Be One of the World's Largest TubingParks KANSAS CITY, MO, (kansascityfrontpage.com), June 28, 2009 - In its first expansion project outside of Texas, waterpark giant Schlitterbahn will build its fourth family destination on a 370-acre site in Kansas City, Kan., just east of Kansas Speedway and Village West. Schlitterbahn Vacation Village will be one of the world's largest tubing parks with miles of interconnected rivers and signature attractions--such as Torrent River and the Master Blaster, a six-story uphill water coaster. The year-round resort will also feature 1,800 hotel rooms including waterfront cabins and "treehaus" accommodations. With this addition, Wyandotte County will more than double its lodging capacity; the county now has nearly 1,400 hotel rooms. Plans also include a mile-long River Walk with destination shopping, dining and entertainment options in a covered, year-round environment. A large Interactive Marine Park will feature salt water lagoons for snorkeling, helmet diving and touch pools. The park's entertainment venues will be connected by a state-of-the-art Transportainment River System. A fusion of transportation, sport and entertainment, manmade rivers will carry guests between lodging units and attractions. Widely recognized as the first family of American waterparks, Schlitterbahn currently operates three parks in New Braunfels, South Padre Island and Galveston Island, Tex. The flagship New Braunfels resort was named America's Best Waterpark by the Travel Channel.
KANSAS CITY, MO, (kansascityfrontpage.com), June 28, 2009 - While the Obama administration's housing policy has been largely influenced by a study of the Boston housing market during the 1990-91 recession in which homes devalued by approximately 10 percent, new research suggests that a novel phenomenon is at hand in the fallout of today's more severe housing crisis - strategic default on mortgage loans. Given that homes in numerous parts of the country have lost more than 30 to 40 percent of their value, many homeowners say they would simply walk away from their loans - without fear of repercussion. A new paper, entitled "Moral and Social Restraints to Strategic Default on Mortgages," looks at American homeowners' propensity to default when the value of a mortgage exceeds the value of their house, even if they can afford to pay their mortgage. By using new survey data, the paper estimates that more than a quarter of defaults on mortgage loans are strategic, especially when home values have fallen by more than 15 percent. The new research was led by Paola Sapienza (Kellogg School of Management at Northwestern University) and Luigi Zingales (University of Chicago Booth School of Business) - co-authors of the quarterly Chicago Booth/Kellogg School Financial Trust Index - as well as Luigi Guiso (European University Institute). With data collected from surveys conducted within the last six months as part of the Financial Trust Index, this paper is the first to examine the economic and moral implications of strategic default in the current recession. Negative Equity The study of the Massachusetts housing market during the 1990-91 recession found that very few people who could afford their mortgage chose to walk away from their homes. Consistent with the earlier paper, this new research shows that homeowners refrain from defaulting as long as negative equity does not exceed 10 percent of the value of the home. After that level, however, the researchers found that homeowners start to default at an increasing pace, and walk away massively after decreases of 15 percent and more. In fact, 17 percent of households would default, even if they can afford to pay their mortgage, when the equity shortfall reaches 50 percent of the value of the house. "Housing policy under the current administration has focused on reducing households' cash flow problems in response to the housing crisis, but no one has addressed the negative equity issue as part of public policy regarding housing," said Sapienza "We're in a completely different economic environment today, where for the first time since the Great Depression millions of Americans have mortgage loans that exceed the value of their home." Moral and Social Factors in Strategic Default According to the researchers, moral and social variables play a significant role in predicting strategic default. People surveyed who said it was immoral to default were 77 percent less likely to declare their intention to do so, while people who know someone who defaulted were 82 percent more likely to say they would default themselves. "The most important barriers to strategic default seem to be both moral and social," said Zingales. "Our research showed there is a 'multiplication effect,' where the social pressure not to default is weakened when homeowners live in areas of high frequency of foreclosures or know others who defaulted strategically. In fact, the predisposition to default increases with the number of foreclosures in the same ZIP code." "Factors such as age, location, political affiliation and attitudes toward government intervention also impacted respondents' responses to the morality of strategic default," he added. Specifically, the researchers highlighted the following data: -- People under the age of 35 and over the age of 65 were less likely to say it was morally wrong to default compared to middle-aged respondents. -- People with a higher education (eight percentage points) and African-Americans (14 percentage points) are less likely to think it is morally wrong to default, whereas respondents with a higher income are more likely to think it is morally wrong. -- Default is considered less morally wrong in the U.S. Northeast (six percentage points) and West (8 1/2 percentage points). -- There was little difference in the moral view of strategic default among Republicans and Democrats, but Independents were less likely to say defaulting is immoral. -- Respondents who supported government intervention to help homeowners were 12 percentage points less likely to say strategic default is immoral. "As defaults become more common, the social stigma attached with defaulting will likely be reduced, especially if there continues to be few repercussions for people who walk away from their loans," concluded Sapienza. "This has an adverse effect on homeowners who do pay their mortgages, and the after-effects of more defaults and more price collapse could be economic catastrophe."   The Kansas City Front Page is owned and maintained by the Moore Design Group for the sole purpose of disseminating news and information about the Metropolitan Kansas City area. Text or graphics may not be copied, rewritten or distributed in any manner whatsoever without written permission. For more information, contact editor@slfp.com All rights reserved world wide © 2007 - 2009 Moore Design Group. |
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