Potential buyers were depressed by the Grandma-died-here ambience: wall-to-wall shag carpeting, ugly heavy drapes, a little ceramic rabbit with a broken ear on the kitchen counter. But I thought, well, we've all got to go sometime. And the Doing the Samba with Cugat! books in the closet were cheery; apparently Grandma had enjoyed a good life in that house. Anyway, I knew I couldn't do better, so I bought the house for $240,000 and made the sellers give me $4,000 back for repairs.
But I couldn't sell the Echo Park duplex without losing money after all the repairs and improvements I'd put in—"you might be able to get $180,000," a Realtor said doubtfully—so I kept it as a rental and bought the new house with something like 3 percent down—about the same amount other people I knew were spending as down payments on new cars.
I am sometimes appalled at the prices of L.A. real estate, even though I've benefited. I know you're not supposed to talk about these things, but what the hell: The Echo Park duplex, which I still own and rent out, is now worth around $400,000; my Silver Lake home is valued at over $600,000. Unlike the house's price, though, my income hasn't almost tripled. And here's what makes me think we may be in a bubble: Even if I did make three times as much money as I used to, I still couldn't hope to buy it now.
Many people missed out on taking advantage of the L.A. real estate recession through no fault of their own. But others, like Jim Priest in the Times's sad Tale of the Downwardly Mobile Renter, just failed to seize the day. I knew others like him. At around the same time I bought my new house, a friend and his wife went into escrow on a Koreatown duplex, but backed out after encountering "nightmare contractors." The nightmare in question turned out to be a contractor who showed up a little late to give an estimate for repairs.
They're still renters. Like Jim Priest, they thought they could do better. Obviously Mary MacNamara and her woeful subject think that when it comes to capitalism, we all can and should do better.
Well, maybe. It's just too bad they never let us know how.
Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time.
Trackback| 11.3.09 @ 12:37PM
credit fix, on credit fix, links to this page. Here’s an excerpt: