McMansion values still slow to recover in one wealthy Chicago suburb

The values of McMansions may be proportionally down and evidence from one well-off Chicago suburb suggests they are selling at similar prices to 15 years ago:

In South Barrington, home to swathes of McMansions, the market has been slow to recover. There, large single family homes regularly hit the market at the same prices they sold for in the ’00s, indicating an enduring lack of demand in the northwestern suburb.

Despite the risk that these homes presented leading up to the recession, it would seem they’re a more sensible investment today — so long as buyers know what they’re getting into. Pound for pound, McMansions are a ton of house for the money. But they’re not speculative equity, and they’re not a retirement account.

It would be helpful to see more data across suburbs. Without such figures, it is hard to know if:

  1. Is this an issue related to Barrington and its location and amenities? The suburb is almost all white and Asian and has a median housing value of just over $800,000. Is there less demand for housing in this particular location?
  2. Is this a problem for all McMansions in the Chicago area? If people are indeed seeking more “surban” locations or Baby Boomers are all trying to unload their McMansions at once, there might be relatively few buyers for such homes in a region of over 9 million residents.
  3. Are the particular features of these homes limiting the value? This could be due to particular features of the homes or many are now up for updates that have not been done.

The issue may not be McMansions at all: perhaps it is the mindset common among Americans that houses should be investments that increase significantly in value.

Social media reveals ongoing American tension between the individual and community life

A cultural historian who examined differences in loneliness between the 19th century and today comments on a larger tension in social interaction:

Sean Illing

In the book, you say that the “new American self” is torn between individualism and community, between selfishness and sociability. Can you explain what you mean?

Susan J. Matt…

While constantly uploading selfies could be understood as selfish, deep down what’s often motivating it is a longing for affirmation from one’s community. What you’re looking for when you post all this stuff is for your friends and family to like you. Right? And that’s a very sociable and communitarian instinct.

And lots of bloggers we interviewed said the same thing. It’s not just Facebook and Twitter, where we’re looking for the “Likes” or the thumbs-ups or the hearts. Bloggers told us they wanted to express themselves, but it only meant something to them if other people liked it.

So the tension between individualism and communitarianism is a longstanding one in American life. And it’s playing out anew in social media, as people try to get their individual voices out there while seeking the affirmation and approval of others.

Three quick thoughts:

1. Seeking affirmation is not necessarily a bad thing. In a face-to-face social interaction, isn’t each participant hoping that the other people respond favorably? This involves the concept of the “generalized other” and “impression management” in sociology: we act in certain ways because we anticipate how others will respond to us.

2. This tension plays out in numerous ways in American history. Two examples come to mind. First, the desire for small town life yet wanting the excitement and opportunities of cities (so meeting in the suburbs). Second, the desire to not be compelled to act in certain ways yet supporting local government and voluntary associations.

3. Another angle to take regarding this issue is whether smartphones and social media are separate phenomena with unique consequences or whether they follow in the line of other mass media technologies and exacerbate existing issues.

What can you tell about a person from their neighborhood?

When I read the news that The College Board is expanding its use of an “Adversity Score” with the SAT (including measures of “the crime rate and poverty level of the student’s neighborhood”), I immediately thought of a basic sociological question that is part of the discussion of the new methods: just how much does a neighborhood or location shape a person?

A few pieces of evidence:

1. A particular location shapes access to numerous resources from jobs to certain neighbors to local services and amenities to schools to certain political structures. Hence, residential segregation has significant influence on life chances.

2. Marketers seem to make a lot of zip codes. For example, Esri has a tool that divides American locations into certain slices:

Just head to the website, type in your zip code, and you’ll be greeted with a breakdown of your zip code’s demographic characteristics based on Esri’s “Tapestry” technology, which consists of 67 unique market segment classifications.

More:

But more than that, the database is a fascinating glimpse into how marketers see the world, and how data profiles can link populations in distant cities—or not. Though cities like Portland, Oregon, and Austin, Texas, might be compared culturally, their marketing profiles are fairly distinct. And while the majority of consumers in Beverly Hills share a profile with those on Philadelphia’s Main Line, for example, they don’t match up with the profile for residents of similarly expensive zip codes on Manhattan’s Upper East Side.

3. Wealthy people seem to use their zip code as a marker for who they are. Getting to help determine who can live in the community or neighborhood is a desirable goal in many places.

At the same time, not everyone in a particular community or location has the same experience. Yet, locations are very formative for people even as they exercise some agency in responding to local conditions or making choices to move elsewhere.

Separating the ills of suburbia from the ills of the United States

The critiques of the American suburbs are common and persistent. But, how many of them are unique to the suburbs as opposed to multiple American settings or American society as a whole? A thought experiment with a number of the ills of suburbia:

  1. Consumerism. Present everywhere with displays of wealth such as expensive housing, cars, and technological goods alongside just having a lot of stuff. Certain suburban symbols may catch attention – such as McMansions and SUVs – but these are present all over the place. Excessive or wasteful consumption is not solely an American problem.
  2. Sprawl. This may seem like a uniquely suburban problem. Yet, numerous American cities have varying levels of density and lots of single-family home neighborhoods (even if these homes are closer together).
  3. Driving. Suburbs may be more dependent or designed around automobiles but so are most American cities and urban neighborhoods. And  rural areas would be very different without widespread access to cars.
  4. Conformity. Mass culture is everywhere, even if cities are often regarded as having more diversity and cultural experiences. This is related to consumerism as many Americans are thoroughly immersed (just see the figures on how much media Americans consume a day).
  5. Inequality. Across categories of race, class, and gender, American communities of all kinds experience problems. They may manifest differently in each context but addressing inequality in the suburbs would not solve the problem in the entire country.
  6. Lack of true community. Social ties seem to be more tenuous across the United States as a whole and the influence of and trust in institutions of all kinds has declined. Americans are famously individualistic, whether in suburbs or other settings.

Another way to think about it: did these problems begin in suburbs or are they amplified or exacerbated by suburbs? Imagine the United States where only 30% of American lived in suburbs: might driving and sprawl still be an issue? Would the problems of inequality be alleviated?

Five forces behind the American affordable housing problem

Affordable housing is not an easy issue to address and one overview provides five factors at play:

Baby boomers—those aged 55 or older—are living longer and more independently than previous generations. They’re also more likely than previous generations to be divorced and living alone. This means less housing stock has been freed up by elderly people dying or moving into assisted-living facilities. In some cases, boomer homeowners are looking to trade down and compete for entry-level homes with other generations, putting upward pressure on prices on homes in the lowest price tier…

While subsequent administrations have swung the agency’s priorities between promoting homeownership programs and assisting poor renters by offering housing subsidies, the federal government consistently subsidizes middle- and upper-middle-class homeowners rather than low-income renters, seniors, and the disabled…

Restrictive zoning codes are often an effective tool in the fight against new construction and, frequently, densification, helping to suppress housing supply even as demand rises. Whether by limiting the height of new buildings or deciding that large apartment buildings need a minimum number of parking spots, these restrictions make construction more difficult and more expensive. California cities like Los Angeles and San Francisco are known for impeding new construction through these methods, which has led to the state’s severe housing shortage

The “affordability” of housing isn’t all about the housing itself: As rising rents and home prices push low- and middle-income households farther from major urban centers—where the greatest number of jobs and the most robust public transit systems tend to be—lower housing costs in suburbs and exurbs get offset by increased spending on transportation.

Three quick thoughts:

  1. As an academic, I am sympathetic with arguments such as this that try to explain a social problem with more complexity and nuance. Short answer for a typical academic answer to a social issue: it’s complicated. As a person who wants affordable housing to be addressed, I want solutions sooner rather than later.
  2. One advantage of the complexity/nuanced argument is to highlight that whole systems are at play. Making serious headway with one or two factor may not move the needle. All the issues need to be addressed and everyone needs to keep in mind their connected nature. To put it differently, this requires large-scale societal change, not just piece-meal approaches. There are a variety of social levels and actors involved and they should aim to work toward common goals. It is often hard to think in this structural or system way but necessary when tackling large problems.
  3. I wonder how helpful it would be to cite successful models or places, even if they are relatively small communities. Even if systems need to be addressed, it can be hard to tackle everything at once without some hope that the goal can be reached. Are there cities/municipalities/states/regions that have some answers that can be adopted elsewhere

Two data points in transportation change: NYC subway ridership peaks in 1946, US non-commuter rail traffic drops after 1945

That the automobile came to dominate American social life and physical spaces after World War II is clear in multiple ways but two recent points of data I saw helped drive this point home.

Start in an obvious place: New York City. On one hand, the use of mass transit in New York City is unparalleled in the biggest American cities. On the other hand, subway ridership peaked in 1946:

1946: Subway ridership peaks

Subway ridership has never been as high as it was in 1946, and a precipitous decline began in the late 1940s as automobiles became widely available. The busiest station in the system, Times Square, saw its ridership drop from 102,511,841 riders in 1946 to 66,447,227 riders in 1953. Subway expansion would become increasingly difficult to justify as New Yorkers were abandoning the existing system—even though outward expansion was just what was needed to keep the subway as the region’s primary mode of transportation.

To a less obvious place: Toledo, Ohio. In the late 1940s, the city proudly constructs a new train station amid a growing population and optimism about the future. And then train traffic fell off dramatically across the country:

In the 20 years following Toledo Tomorrow, non-commuter rail travel in the U.S. collapsed, falling 84 percent nationwide, thanks in large part to the airports and the ribbons of limited-access high-speed roads Bel Geddes had foretold. Five years after the new railroad station opened in Toledo, the New York Central put it up for sale. Eight years later, the Beaux-Arts Pennsylvania Station in New York City would be demolished; five years after that, the New York Central and Pennsylvania railroads combined to form Penn Central, then the largest merger in American history. It would become the largest bankruptcy in American history two years later.

There is little doubt that the car is a nearly essential part of American culture today but it was not always this way nor is it guaranteed to be in the future. Reversing or countering a major trend is always difficult, particularly when its tentacles are everywhere and embedded in infrastructure and culture. To truly move to other forms of transportation would require not just fewer cars and vehicles on roads but a massive reconfiguring of American society.

Downsizing, Marie Kondo, and all the stuff Americans own

Many older Americans want to downsize (and cash out on their homes), Marie Kondo’s approach is popular, but where will all that stuff owned by older homeowners go?

Auctioneers and appraisers, junk haulers and moving companies all seem to be echoing the same thing: The market is flooded with baby boomer rejects. And they cite a number of reasons our kids are turning down the possessions we so generously offer to them. They rent rather than own, live in smaller spaces, collect more digital than physical items and tend to put their money toward experiences rather than things…

Her kids also rejected three sets of formal dinnerware, including Haviland China; vast collections of Lladro figurines and Department 56 Christmas villages; as well as 3,000 Beanie Babies and boxes of soccer awards she and her husband, who both coached for many years, earned with their children.

The only offer she got on any of her treasures? One son wants her Hallmark Frosty Friends ornaments she’s collected over 37 years “because he knows how much they are worth.”

Two scenarios could develop:

1. There will be a growing market in stuff that older Americans no longer want. Perhaps many millennials or Gen Z do not want stuff from their parents but some other American will want it. It does not just have to go to resale shops; enterprising individuals and firms could shop all these items online to find buyers interested in particular niches. Perhaps this could even expand to international markets and be shipped in bulk around the globe.

2. Much of the stuff will simply be thrown away, particularly items that are more sentimental in nature. Some lucky owners will find people to take or buy their unneeded items but much of the rest will simply find its way into landfills. Decades of consumption will end in the garbage can.

I have not seen any estimates either way of how much money all of these goods could generate or how much waste could be involved (or a combination of both).

Also, consider the implications of such a change: younger generations do not take material objects from their parents and grandparents, creating a bit of a gap in a material timeline. Perhaps the shifting of wealth from generation to generation more often takes the form of helping to pay for housing or student loans rather than tangible goods. How does this change memories and collective understandings of the past?