June 23, 2008

There Goes the Neighborhood

California and the nation are sinking into a sea of foreclosures and auction signs, and Salinas is no exception. A casual drive around our neighborhood reveals dozens of "For Sale" signs, empty houses and dead lawns. It's starting to feel like a ghost town . . . our generation's version of places like Bodie and Ludlow.

When we moved to Salinas in July 2001, fairly-new homes were fetching up to $400,000; at the height of the boom, people were asking for more than $700K! So we rented. For years friends told us to buy now, before prices went completely out of reach. Boy, we're glad we waited. Laura once said that the only way we'd be able to buy would be by "capitalizing on someone else's misery." She was thinking more along the lines of a major earthquake, though, not the collapse of the entire housing market.

Our first real estate venture wasn't entirely successful -- we bought in San Bernardino at the height of the market in 1989, and within a year and a half our home lost 25 percent of its value. We perservered, and 10 years later we were happy to sell for $6,000 more than we originally paid. Perhaps the real estate fairy will smile on us this time. There's something to be said for patience.

The Atlantic, one of my favorite magazines, recently ran an article about America's next slums. They won't be in the inner cities, the writer said; they'll be in the suburbs. During the past decade, urban subdivisions sprawled across the Southwest with little thought to the future. Today, driving past clusters of auction signs, I'd say the future has arrived.


KWG said...

Holy crap. It has, hasn't it. We've got one home in our development that's been on the market for well over a year now. There were two, but the owners took it off and decided to sit tight. You'd think the gold all but dried up in the suburbs. Unfortunately much of it was fool's gold.

Kat said...

Awesome blog, Dad. I didn't know we got profit out of our old house! Though, mom said its not much. Oh well... at least you got some $$. :)