It was refreshing to read about U.S. home prices rising 7.4% over the prices of one year earlier. Of metro areas, 22% showed double digit increases. The median family home price was $205,000 versus $191,000 one year earlier. Homes are selling at an annual rate of 5,000,000.
But not where I live.
I get to watch the best and worst of times as I observe the moribund market for the large beautiful homes in my village of Olympia Fields, Illinois, and compare it to my daughter’s neighborhood of small 60-year-old homes in Palo Alto, California, the center of Silicon Valley and home to Stanford University.
The contrast is amazing to observe. Directly across the street from my house two homes have lingered on the market for years, both spacious 4-bedroom houses on 15-20,000 square foot lots. Squatters lived in one before they snuck out in the dead of night 6-months ago.
In my daughter’s neighborhood, potential buyers launch campaigns to endear themselves to sellers to enhance their buying position. Houses usually sell in one week, often with overbids.
In my neighborhood a 2500 square foot house might sell for $175,000. An 1800 square foot house on a 7500 square foot lot in Palo Alto brings $2 to $3 million depending on location and amenities.
It’s supply and demand to the nth degree playing out. People from all over the world flock to Silicon Valley for high paying jobs. In Olympia Fields the baby boomers who bought 35 years ago are leaving for warmer climates, buying a condo in the city or just dying off. It seems like very few folks want to live in my community, even though it has lovely parks, good access to commuter trains and expressways, and minimal crime.
The simple answer is that affluent white people do not want to buy into an Olympia Fields that is comprised of about 50% African American people. But the interesting corollary is that not enough African American people want to live in Olympia Fields to fill the existing homes and push up the prices. It appears that upwardly mobile black people do not want to move to an area that seems “too black” for them.
I grew up in the bad old days on the south side of Chicago next to Jackson Park where the new Obama Library may be built. I used to practice my 5 irons and putting on the 6th green of the golf course across from our house. It was a lovely neighborhood back in the 1950s and ’60s, populated by caucasians adjacent to an African American neighborhood. There were no integrated neighborhoods then. When black people moved in, whites moved out. I observed white flight dramatically. In my public grammar school, Parkside School, there were 48 kids in a class, taught mostly by veteran Irish lady teachers who assigned seats arbitrarily. Black kids were mostly on one side of the classroom, whites on the other.
My high school was the University of Chicago Lab School, a private school for the U of C faculty’s kids, which expanded to take in kids from the surrounding areas. Many students were like me–they had parents who would not send them to the almost all black public high school, Hyde Park, that my residence would require.
My wife, Risa, is from Charlotte, North Carolina, where she went to Myers Park High, an almost all white school, just before Charlotte became the test case for school integration in the South.
We both wanted to live in a place that was different than the places we came from, so we ended up in Olympia Fields, rated one of the best places to live in the Chicago area back in the 1970s. It was integrated racially, had a small but vibrant Jewish community, and good though not great schools.
We stayed. And we stayed. And now many of our neighbors are African American, homes are vacant, schools are primarily African American kids, and home prices are one third of comparable dwellings in Northern and Western suburbs of Chicago.
This is race and real estate in Chicago in 2015. As a writer it is a fascinating story that I have seen unfold. As a real estate owner it is depressing to see the values drop so low.
I know many of our friends who have left the area wonder why we stayed in Olympia Fields.
The simple answer is that we do not want to leave. We love our house. My wife has her practice in the house, I live 12 minutes from our factory. We have a gorgeous view of a leafy park and a soccer field. We still have good friends in the area, and Risa thinks the local Starbucks makes a darn good mocha Frappucino.
A condo in the city would cramp us and feel stale. We have lilacs blooming now and we’ll be planting tomatoes in a few days. And that condo would cost us three times what we might be able to sell our home for.
So we stay and see how it plays out. Race and real estate are permanently intertwined in Chicago. I accept it, even if I hate it. Maybe it will change in 50 years, although I doubt it.
Question: Do you wish you could move?