There Goes the Neighborhood

It’s 2002: My limited stock holdings have plummeted, my income is stagnant and my financial prospects are not all that rosy. And worst of all, I think my house is worth too much.

In 1997, when I bought my house, I became one of the zeitgeist statistics of the day. I joined the largest percentage of Americans ever to own their own home and was one of a record number of first-time buyers.

I felt a patriotic rush knowing the economists and politicians were talking about me when they blathered on about the robust economy and the historic levels of homeownership.

Never mind that a friend lent me most of the down payment and co-signed the loan. Or that I had bought a house so in need of repair that a movie location scout came by after my purchase wanting my new home to stand in as a crack house. I happily applied the $500 location fee toward a new roof.

My street was in a somewhat mixed, middle-class neighborhood in Venice. My house’s previous owner, who had recently died, bought the house new with her husband in 1946. Thanks to the hassles of a probate sale and the lingering effects of the riots and the earthquake, I was able to buy it for less than $170,000--a pittance for Southern California real estate a mile from the beach.

I did not, however, send pictures to my family in Philadelphia. They would have thought I had lost my marbles paying so much for so little. But I saw the potential and was willing to live amid the wreckage to stake my claim to the American dream.

As I spent many hours and dollars slowly rehabbing my hovel, my street gentrified around me. Real estate prices climbed. In short order, I became another trumpeted statistic. I got thousands of dollars out of my equity to repay my friend and remodel the kitchen and with interest rates diving even lowered my monthly payment.

I recently read that houses in my Venice ZIP Code now have the second-highest value per square foot in all of Los Angeles County. My two-bedroom, one-bath home is probably worth more than $400,000. The recession and the events of Sept. 11 seem to have done nothing to shake the market. I should be thrilled. But when informed that a similar but unimproved house up the street just sold, in days, for more than twice what I paid, I found myself half-wishing the house had languished on the market and sold for tens of thousands less.

I chose Venice on purpose. I liked its mix of rich and poor and in-between, of people who didn’t all look like me. Artists could afford to live here. But now, the artist and teacher across the street couldn’t come close to affording the house they bought three years ago.

I’m fond of the lawyer who owns a home a few houses away, but I also enjoy living near the librarian and the masseuse in the dilapidated rental bungalows on the other side of him. And the aging rockers who have rented down the street for years. I like that the gardener owns a house on the street.

Two absentee owners have recently sold--evicting longtime tenants--to net hundreds of thousands of never-dreamt-of dollars. Sure, it’s comforting to come home to this huge asset every day, but I’m not planning to go anywhere. Does it really matter that my house is worth so much? If I sold, I wouldn’t be able to buy anything close by. I also fear for the scale and spirit of my street.

I’ve accrued financial gain through good timing, hard work, a generous friend and a willingness to live in a “crack house” for a few years. In Venice, those days are over. I’m grateful I “got in” when I did and glad to live in a house worth more, not less, than I paid for it. But lost in the feel-good housing statistics is the value of living here.

I’m starting to think my house would be worth a lot more to me if it just wasn’t worth so much.