‘California Dreamin’: Just how tough is it to buy a home here, anyway?

Why We Wrote This

Homebuying in California is not for the faint of heart – or light of pocketbook. Our reporter’s experience offers a microcosm of the housing crisis that is putting young people and families in moving vans bound out of state.

Ann Hermes/Staff
A row of “Painted Ladies” is seen next to an apartment complex near Alamo Square Feb. 11, 2019, in San Francisco. The average list price of a home in the city was $1.35 million, according to Zillow.

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Ours is a house-hunting story with a happy ending. But every step along the way illustrates what people are up against if they are trying to buy a home in California.

More folks called it quits with California last year than moved here. The state’s population saw its lowest growth rate since 1900, according to estimates – meaning California is on track to lose its first congressional seat in history.

Basically, it’s way too expensive, with astronomical housing prices driving out young people who otherwise would be starting families, says demographer Dowell Myers.

“We’ve been talking about this for some time. This is it. This is the future,” says Professor Myers. “The baby boomers are retiring, and you have to get replacement workers, but the workers can’t afford to live here.”

During the holidays, my husband and I stopped to admire a neighbor’s Christmas display and met her mother, Arzella Valentine, who is in her 90s.

Arzella and I have something in common: a love of writing. She gave one of her poetry books to me and one to my husband, inscribing them both. Mine read, “Welcome to my new neighbors. You are going to be very happy here.”

I’m sure we will be. California’s challenge is to make sure many more people can afford that happiness.

Ours is a house-hunting story with a happy ending. But every step along the way illustrates what people are up against if they are trying to buy a home in California.

For the first time since 2010, more folks called it quits with California last year than moved here. The state’s population grew by a mere 0.35%, its lowest growth rate since 1900 (not a typo), according to new estimates from the state’s Department of Finance. The slow population growth means California is on track to lose its first congressional seat in history.

The sheen is off the Golden State, and that is a very big challenge for the world’s fifth-largest economy. Basically, it’s way too expensive, with astronomical housing prices driving out less-educated young people who otherwise would be starting families and becoming taxpayers, says demographer Dowell Myers of the University of Southern California in Los Angeles. The number of young children in Los Angeles County – where we live – dropped 21% between 2000 and 2017.

“We’ve been talking about this for some time. This is it. This is the future,” says Professor Myers. “The baby boomers are retiring, and you have to get replacement workers, but the workers can’t afford to live here.”

The tepid population growth mirrors a national slow-growth trend. The U.S. Census Bureau attributes the trend to fewer births and more deaths. That’s true for California, too, along with slower immigration. But the biggest cause, according to the state, is more people packing up and moving to places like Texas, Arizona, Oregon, and Colorado.

According to Zillow, the median list price of a home in San Francisco was $1.35 million in November – the highest in the nation. Housing and high taxes are not the only factors driving people away. Take Victor Krummenacher, of the band Camper Van Beethoven. After 30 years in San Francisco, he cashed in his real estate and left in 2018. He now lives in his hometown of Riverside with his mom, touring and working as a graphic designer. He plans to move to Portland, Oregon, this summer.

Mr. Krummenacher says he left San Francisco because a long-term relationship failed, but so had the city’s quality of life. Artists used to be able to “throw it together” with part-time work and still focus on creativity, he says. With the tech boom, the city became “corporate” and unaffordable, clogged with traffic. Artists moved further out, or just plain out. Looking for a for-hire bass guitarist in a blues bar? Good luck.

He craved an environment more conducive to creativity. Even if he had stayed, getting to a yoga class might take an hour, “and then you’re going to have to step over people shooting up on the street, right? The streets are filthy, and you know, your car is going to get broken into five times a year. I mean, these things are all things that happened to me.”

Mr. Krummenacher says he’s “sensitive” to all the negative talk about San Francisco. He knows some “miraculous musicians” who still live there. But it’s not as if the Bay Area will produce “the next challenging wave of music.” It’s not a go-to place for a musician.

It wasn’t a go-to place for us, either. Even though we once lived in the Bay Area, we set our sights on Los Angeles County, where the median price is about half as expensive ($695,000 in November).

We arrived last May and were provided two months of corporate housing. We needed every single week, as we tried to break into a tight market. Of course, we set a top price. Of course, we had to adjust it upward – by increments of $100,000.

It seemed not to matter whether these were California ranch houses, English Tudors, bungalows, or Spanish style; they all drew multiple offers – sometimes more than a dozen – including all-cash bids from foreign investors. We were encouraged to submit cover letters and a photo with our offers. It was never clear whether these love notes were meant to endear us to the seller, or just show that we were not “foreign investors.”

That’s code speak for mainland Chinese looking to park their money in a safe place overseas. They are perceived as a plus and a minus – cash sales for sellers, but with a reputation for replacing ranches with McMansions, never actually occupying properties, and driving up prices.

A brush with celebrity broke up our summer of discouragement. We were all set to bid on a ranch – complete with pool and view of Los Angeles – when a little Google digging revealed that the owners had undergone a messy, public divorce. The man was a famous martial arts film star in China, who announced on social media that he was divorcing his wife because she was having an affair with his agent. A court had yet to decide how their assets would be divided up. Our real estate agent raised this with the seller’s agent, who quietly took the house off the market.

After this my husband suggested we check out a nearby property, even though it was beyond our top-top-top price. The orange door opened and we loved it. A real indoor-outdoor California home, graced by stately oak trees. Private. Quiet. Unknown to us, the sellers that day had dropped the price by $100,000 – the market was moving into high summer, buyers were dwindling, and the owners faced a deadline.

Now we have a mountain view and the occasional coyote – at nearly three times our property taxes in D.C.

When people ask me what I like about LA, the first thing I mention is the culture. All those artists seeking to “make it” here mean high-quality performances at the smallest venues. Our church’s Christmas concert featured a string of soloists who sounded like they perform with professional opera houses and symphonies – because they do. We sometimes attend living room jazz concerts at the home of former Monitor reporters.

During the holidays, my husband and I stopped to admire a neighbor’s Christmas display. I called out my approval to the woman sitting in a chair on a little stone patio. We walked up the drive and saw that a caregiver was bringing her lunch, while another helper was working on the lawn.

Introductions all around revealed the seated woman, Arzella Valentine, to be in her 90s, and the mother of our neighbor. Arzella and I have something in common: a love of writing. A broad smile on her face, she told us she had published two books of poetry and essays about growing up in the tiny African American town of Mount Olive, Arkansas.

She gave one to me and one to my husband, inscribing them both. Mine read, “Welcome to my new neighbors. You are going to be very happy here.”

I’m sure we will be. California’s challenge is to make sure many more people can afford that happiness.

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