Where's the liberal outrage?

"Progressive" homeowners decide who can and can't afford to live somewhere

I’m a lucky bastard.

First, I was born a white male in America in the 1980s to middle class parents. Maybe that’s not the billion dollar power ball payout, but its still a pretty damn lucky draw. And yeah yeah, I’m also lucky because I have a great family, friends, girlfriend, and even my idiot but loveable dog. Life is, and has been, good to me.

Then in 2019 I hit the jackpot again without even realizing I was buying a ticket - I bought a house. I did so in my mid-30s, not out of some lifelong dream to be an American homeowner (I was actually anti-homeownership for a long time), but mostly out of a desire to root myself somewhere. I had moved 17 times in the past decade for a variety of reasons, and thought, if I tethered myself financially somewhere I’d finally settle the hell down. After a about a 6 month search I finally pulled the trigger on a 1913 Craftsman Bungalow in Woodland Heights, just off the Ingersoll corridor.

Turns out it was a great move because 1) I love my house and 4 years later couldn’t be happier with it, and 2) the next year the housing market absolutely went nuts and I was already in. Lucky me.

Ah the American home owner - the savviest of investors.

Let’s talk real numbers here (coastal readers avert your eyes!). I paid $145k for my 970 sq ft, 1913 Craftsman bungalow in Des Moines, IA. $145k for a house now seems like a joke, but in 2019 in Des Moines that wasn’t exactly a steal, and we went back and forth for several months before settling on the price.

As memory serves, I put 5% down so let’s call it $7,250, plus closing costs. All that yielded me a mortgage payment that was pretty much the same as what I was paying for a 1 bedroom apartment in downtown Des Moines. Since then I’ve put another maybe $10k into the place, mostly in the form of backyard improvements ($5k for a fence for my free dog, thanks Mel): fairly standard type homeowner stuff. The inside could still use some work, I need a kitchen and a bath remodel, the appliances are dated, but otherwise the house is in great shape, and located in one of the few walkable neighborhoods in Des Moines.

Mel enjoying the new patio, we might have been slightly off on the grade when we did it (you get what you pay for with free family labor)

If I were to list it today and trying to get top dollar, I’d probably start at $245k, in Des Moines Iowa. I don’t know if I would get that - but a recently remodeled home just up the block went for $240k and its on par with mine (plus/minus some various amenities).

Let’s say I use a realtor to get my targeted sale price of $145k, less the commission, some estimated transactional costs, and paying off my mortgage, and I walk away with about $100k in cash from my initial $19k in to the house. That’s a 400% return in 4 years - and no I’m not a venture capitalist, I’m just a dude who desperately wanted to stop moving all the time. Even if I don’t get top dollar, I’m still guaranteed to have a very nice return.

There is a major caveat with the above scenario: I’m now homeless. I would need to either re-buy back into the same market (goodbye cash pile), or go back to renting, which I could easily afford to do with my $100k stockpile.

This house sold for $240,000 in Des Moines freaking Iowa! And that was after rates started going up

The reality is I’m going to do neither, because see previous statement re: loving my house. But the illustration is to show just how crazy the housing market has gotten in this country, even in places like Iowa.

This is not supposed to happen, a house is not supposed to be some amazing financial investment. This is pushing us further towards a two sided society of haves and have nots. Those who can afford to buy a house, and those who can’t.

And where is the outrage in all of this? Sure we talk about how expensive houses are now, but most homeowners can’t help but smile when they see their Zestimate, like they are some Warren Buffett of the housing market when they purchased their home. We should be pissed off when we see how much our houses are worth compared to not very long ago.

Why is no one pissed off?

This is where the YIMBY movement, the abundance economy, and several other loosely defined ideas that I generally ascribe to come into play. We need to be building housing, where people live, and where people want to live: housing of all types, for all incomes.

Instead we have liberal homeowners who decry any new housing that doesn’t meet some mysterious criteria they deem as “appropriate for the character of the neighborhood” (usually detached single family homes), in order to protect their now grossly inflated precious property values - while a younger generation watches housing affordability get pushed further out of their means, and more and more people are pushed into housing instability and houselessness because it just simply costs too much to live anywhere.

This happened in my neighborhood right after I purchased my home - a local developer who wanted to build live/work type townhome units 2 blocks from my house was beaten down by longtime residents who only wanted single family housing on the site and feverishly defended their right to ample on street parking at any time (some of these people laughably call themselves environmentalists too).

Now that parcel is an urban farm collective, which honestly is a lot better than the field of grass across the street, (that was also supposed to be housing but got shot down) but it should have been housing. It should be housing. It could have been housing that the people who bought the $240k house up the street from me could have opted to live in, and maybe that house sells for $230k instead, and the next one down market from there sells for $210k instead of $220k.

Home values go up wheeee isn’t everyone happy??

Housing economics is pretty simple in America - it all goes back to supply and demand. But as incumbent homeowners we have a bias to want to restrict supply because what does that do? It makes prices go up! Wheeee!

So next time you see your Zestimate - get pissed, at least if you’re the type of person who believes everyone should have a roof over their head. That green arrow up with double digits next to it has a link to the homeless person begging at the intersection for change. It’s not direct, and its not 100%, but the connection is there.

It’s not supposed to be like this. Home ownership, as we’ve defined it in the United States, should be a great way for families to build financial security. Your home should be a de facto savings account. It’s not supposed to be an investment that allows you to 4x or 5x your return in less than a decade.

Now my little vignette is just a tiny example of the macro trends of what we’ve been realizing in this country over the past decade. But its still telling, because where people are the most anti-housing in this country often tend to be the most liberal, just like my little slice of Des Moines. The west coast housing crisis afflicting very blue states is my example repeated over and over…and over.

Where is the liberal outrage?

We can continue to make the same mistakes as them, or we can turn our investments back into savings accounts and make sure that housing and homeownership are actually attainable goals for the next generation.

Welcome to the beginning, and end, of my political career.

I’m Alec Davis, and I’m here to take away your parking, and lower your property values.