Housing, the holidays, and the economy

Just before Christmas, President Joe Biden touted the economic strength of the United States:

Photo by Jamie Lee on Pexels.com

Americans have been through a tough few years, but I am optimistic about our country’s economic prospects. Americans’ resilience has helped us recover from the economic crisis created by the COVID-19 pandemic, families are finally getting more breathing room, and my economic plan is making the United States a powerhouse for innovation and manufacturing once again.

In the list of economic accomplishments, I could find no mention of housing. None. Zero. There could be a few reasons for this:

  1. There is little good news on the housing front.
  2. The new about housing is less good or clear than the areas Biden cites.
  3. Housing is not viewed as a winning political topic.

What could political leaders do to help deliver a Christmas housing present for Americans? How can they talk about jobs, incomes, taxes, and opportunities without mentioning one of the most basic pieces of the good life in the United States: a pleasant home or residence in a decent location?

I keep thinking about the car commercials that have run for years featuring people getting new cars, SUVs, or trucks as Christmas gifts (sometimes with a bow). This might be the ultimate in Christmas consumption: a true big ticket purchase on the biggest consumer day. At the same time, Americans like cars and driving and are willing to shell out for it. Americans also like single-family homes; could someone develop a Christmas housing share gift program? Or, “give a mortgage”?

Even George Bailey, who realizes life is worth living, has a home to come back to at the end of the classic film. How many Americans want a storybook ending that includes such a home this Christmas?

How Americans arrived at converting rooms into closets

Is it as simple as Americans own a lot of stuff so they then need giant closets?

Photo by Victoria Borodinova on Pexels.com

That model held for the next century or so, until the postwar American economy lurched into motion, setting the country on the conveyor belt that would eventually deliver it to Kylie Jenner’s mirrored hall of designer handbags, a tour of which has been viewed more than 15 million times on YouTube. Prosperity settled in the suburbs, where millions of families moved into progressively bigger homes. Today, the average new single-family home is more than 1,000 square feet larger than it was in the early 1970s, even though new homes have, on average, fewer people living in them. (Regardless of Americans’ lack of need for giant houses, our zoning laws create them; many local governments have made building apartments or condos effectively illegal, and they are supported in this by homeowners, many of whom fear attracting less wealthy neighbors but welcome anything that pumps up property values, such as bigger houses down the street. Developers are happy to comply.)…

American homes not only have more space and fewer people than they once did; they also have a lot more stuff. “We’re conditioned that we need the right thing for the right activity,” Jill LaRue-Rieser, the senior vice president and chief merchandising officer for the custom-storage company California Closets, told me. As clothing in particular has gotten less expensive and more bountiful, big closets have become a selling point unto themselves. “The builders really figured it out,” she said. “If they could hook women with enough space for their shoes, they could sell the whole house.” Which is why, for decades, the country’s closets have had no reason to do anything but grow, fueling the perpetual-motion machine of the modern wardrobe—you have more space, so you don’t hesitate to buy more stuff, but eventually your big new closets seem cramped and small. At that point, maybe it’s time for a new place with even bigger closets…

Bradford said that converting a spare room to a closet has become particularly popular in recent years because it accommodates various internet home-design fantasies: natural lighting, room for a center island, seating areas, and space to show off particularly beloved collections of sunglasses or handbags or sneakers. “If people have something they value a lot, they want to create a perfect space for it, to highlight it,” she told me…

In other words, extreme closets may be starting to resemble those of, say, 16th-century Europe: a collection of prized things on loving display, a comfortable seating area in the innermost sanctum of one’s home, maybe a little desk area to work in solitude. “It’s about being proud of your space, feeling really good and calm in your space,” Adams said. Just like the Renaissance-era closet enthusiasts—though they probably lacked a wine or coffee station.

Jay Pritchett was ahead of his time: what America really needs are closets, closets, closets.

As the article notes elsewhere, if HGTV is to be trusted in this matter, a lot of bedrooms have been turned into large closets. This is a formal statement: a homeowner wants a large closet with particular features. But, this is a formal declaration of what has been happening for decades as Americans used spare rooms, attics, basements, and garages to store all of their items. As a person with a fair amount of stuff myself, I was intrigued by the first neighborhood we lived in as homeowners where all of the units had one car garages. Very few people parked in those garages. Instead, they held various items that did not fit in the relatively-small-by-today’s-standards 1,450 square foot residents.

I do think the curating and display of one’s possessions is worth noting. Today, it is not just about owning items but also about having ways to organize and show these items. Traditionally, closets are not something a homeowner might show to visitors. But, convert a room into a closet, put in an island and custom shelving plus a dazzling light fixture and this is now part of the home and possessions tour. How much time people actually spend in the expanded closet does not matter; this is a luxury item for the homeowner and the visitor.

I wonder if the reduced size of American households plays a large role here. If households have three-plus bedrooms but only a few members living in the home, there is now a free room. This could become an office; this has also picked up in recent years, even before working from home due to COVID-19, due to an interest in a clearly-defined and purposeful space. But, it could also become a closet or a theater room or a workout space.

How searching for houses online became sexy

With SNL poking fun at the ways people in their late 30s use Zillow to look at housing, what makes online home shopping such a current phenomena? I thought of the numerous factors that had to come together – here is an incomplete list:

SNL “Zillow”
  1. The rise of online real estate sites and apps. These have been around for years but between Zillow.com, Redfin.com. Realtor.com, Trulia.com, and more, potential sellers and buyers have a lot of easily accessible platforms. These options are now ubiquitous: people can search at any time from any location for any length of time. And now that some online listings have video tours and/or 3D models, viewers can get a good sense of what a property is like without ever getting near it.
  2. COVID-19 adds much to existing patterns. With some people interested in moving out of cities and health risks making it more difficult to see homes, online viewing may be the primary option.
  3. The SNL spoof targeted a particular age group – people in their late-30s – who might be in the middle of a housing dilemma. By this age, those interested in settling down somewhere may or may not have the resources (think school loans, unstable employment during COVID-19 and the last economic crisis in the late 2000s) to buy in the places they want. But, the browsing is free and all sorts of homes in all sorts of locations are available.
  4. The single-family home has always been an important part of the American Dream. Today, this is true and in new ways. The home is a respite away from COVID-19 and political polarization. It is an important investment as buying the right home is not just about enjoying day-to-day life; it should pay off in the future when the homeowner wants to sell and housing values have continued to rise.
  5. Americans also like to consume and compare their social status or possessions to others. With homes occupying such an important part of American mythology, these larger patterns carry over to these sectors. Browsing homes online allows for window shopping and comparisons on one of the most expensive investments. And homes are not just dwellings; they offer windows into lifestyles and neighborhoods.

Put all of these together and you get an SNL reflection on how home searching and purchasing happens today.

Basic sociology in the story of a fancy burger from cattle breeding to plate

The story of a $20 hamburger in Washington, D.C. reminded me of several basic sociology concepts from Introduction to Sociology:

ham burger with vegetables

Photo by Valeria Boltneva on Pexels.com

But for months, the burger had been traveling through a complex supply chain crippled by the novel coronavirus. Now it was about to end up in a takeout box…

On the burger’s journey from a Kansas farm to the engineer’s dinner plate, every person had a story like Solano’s. A rancher with five children who lost thousands every week. A factory worker who brought the virus home to her son. A courier who calculated the true cost of every delivery not in profit, but in the risk it required her to take.

To follow the burger is to glimpse the lasting toll of this pandemic: on the beef supply chain, on the restaurant industry, on the people who were struggling before this catastrophe began, kept going to work throughout it and are still waiting to see what their lives will become when it ends.

A few of the sociological concepts in the story:

  1. The miracle of modern systems. The number of people involved, the travel, and the meanings and social policy it play all hint at the complexity and ability of rationalized processes to bring a burger to the home of city residents. Reminds me of Durkheim’s organic solidarity and division of labor as well as Ritzer’s McDonaldization.
  2. The human involvement and costs all along the way. Producers and workers struggling, consumers eating the product with little idea of how it all happened, and an economic and social system that tried to make it as profitable as possible. Furthermore, many of the people are faceless and their personal and collective circumstances – whether race, class, or gender – are obscured or ignored. Reminds me of Marx and alienated workers as well as consumption patterns within modern capitalism.
  3. I am struck by two additional factors that perhaps could be hinted at during Intro to Sociology: does this story illustrate urban-rural divides? The city residents, young 30-somethings order fancy burgers after a week of white-collar work, ranchers raise cattle in the middle of the country, and faceless workers in between facilitate the exchange. And does this illustrate how broad social change is within the United States over the last century? Some aspects of this story could fit 100 years ago – the shipment of beef and other agricultural commodities helped make Chicago and other places – while other aspects would be unheard of. People need to eat and make money but how this happens evolves over time.

What if Americans stop buying things they do not need?

COVID-19 has helped slow retail sales and one writer suggests this could be a tipping point toward a society where fewer Americans feel the compulsion to consume:

We’re trained to buy often, buy cheap, and buy a lot. And I’m not just talking about food, which everyone has to acquire in some capacity, or clothes. I mean all the other small purchases of daily life: a new face lotion, a houseplant holder, a wine glass name trinket, an office supply organizer, a vegetable spiralizer, a cute set of hand towels, a pair of nicer sunglasses, a pair of sports sunglasses, a pair of throwaway sunglasses. The stuff, in other words, that you don’t even know that you want until it somehow finds its way to your cart at Target or T.J. Maxx.

In post–World War II America, the vast majority of things we buy are often not what we actually need. But they’re indisputably things we want: manifestations of personal and collective abundance. We buy because we’re bored, or because planned obsolescence forces us to replace items we can’t fix. We buy to accumulate objects meant to communicate our class and what sort of person we are. We buy because we want to feel something or change something, and purchasing something is the quickest way to do so. When that doesn’t work, we buy “an experience,” whether it’s a night at Color Me Mine or a weekend bachelorette trip to Nashville. We buy because, from the Great Depression onward, how we consume has become deeply intertwined with how we think of ourselves as citizens…

And yet we keep spending: As of 2018, the average household expenditure was $61,224. That’s rent and groceries, but also nonessential items: entertainment, vacation, clothes, plus all that other random stuff that ends up in your shopping cart.

That kind of spending is what our current economic model is based on: Americans of all class levels buying things and always wanting to buy more, regardless of their actual means. But when a society-throttling, economy-decimating pandemic comes along, what happens when that ability — and, just importantly, that desire — goes away? In April, retail sales fell an astonishing 16.4%, far more than the 12.3% economists had predicted. Clothing store purchases went down by 78.8%; furniture and home furnishings plummeted 58.7%. If you feel like you’re buying far less than at any point in recent history, you’re very much not alone. But will American identities and habits actually change, or will we just figure out a new and COVID-19–compatible way to consume at the same rate as before?

The argument makes some sense: many people in the United States have now had a few months where they could not consume in the same ways. And there have been plenty of people in recent decades asking Americans to slow their consumption or change their habits, ranging from sociologist Juliet Schor discussing downsizing or tiny houses or the popularity of Marie Kondo.

Yet, here are a few obstacles to a slow down in consumerism:

  1. As noted in the article, decades of messaging from politicians, advertisers, companies, and residents that consumption is good and acquiring items is a key marker of living the good life. The American Dream is partly about having a lot of stuff.
  2. The interest Americans still have in buying houses. And since the supply is not great, prices may stay high.
  3. The ever-increasing prices of new vehicles and the Americans who want to endlessly purchase pickup trucks and SUVs.
  4. New technology items will continue to emerge, particularly smartphones. But also think about new video game consoles, virtual reality units, home camera systems, electric cars, and so on.
  5. The large houses Americans have compared to the rest of the world. They need to fill all that space with something!
  6. Online ordering makes it very convenient to consume items without much effort. If retailers disappear in large numbers or shopping malls fade away (except for the wealthiest ones),

Absent many more months of staying at home or a large collapse of the American economy, it will be hard to transition away from consumption as Americans have known it to another system.

Trying to kick the consumption habit while living in a tiny house

One scholar studying people who lived in tiny houses found that a smaller space did not necessarily mean to having less stuff:

Tiny houses are often put forward as a more sustainable housing option. They are certainly a potential check on the continued pursuit of bigger houses and greater consumption of energy, building materials and so forth. Yet reducing your environmental impact by going tiny is not as simple as some have claimed.

I came across several tiny households that were using external storage spaces for items that wouldn’t fit in the home, for example. Referred to as a “dirty secret” by one interviewee, another explained her desire to keep items from her previous home in case she changed her mind about tiny living.

Over half of my interviewees had a “one in, one out” mentality, where they would throw away or donate one item to make space for something new. As one dweller in her late 30s, who lives in a state-of-the-art home in a caravan park in rural New Hampshire, said, “I have a TJ Maxx addiction. I still go out every couple months and buy a bunch of stuff then come home and decide which things to get rid of.”

Regardless of how tiny living is marketed by the enthusiasts, sustainability was not a major driver for most of the participants in my study. Instead it was almost an afterthought. It seemingly takes more than changing the size of a home to change the mentality of the people who live inside.

One reason (among many) that Americans live in large houses is in order to store all their stuff. Having a smaller dwelling does not necessarily mean that the resident will get rid of all their stuff or reduce their consumption. Because there are so many options for storing stuff, it can be easy to keep all that stuff. (Side note: I could imagine future communities of tiny houses or tiny house living quarters surrounding larger community facilities like kitchens and entertaining spaces that include storage facilities or warehouses on site.)

Furthermore, the American economy needs people to buy things and American culture celebrates buying more (and buying bigger things). There are occasional calls to curb consumption – or at least pare down the number of things one has – yet they put limited dents in the overall patterns

Perhaps the bigger change will come over time. Imagine someone who has lived in a tiny house for a decade or more. Will they still keep their stuff in a storage unit wondering if they will move to a larger dwelling? Will they learn to live without all that stuff and get rid of it? Or, imagine a kid who grows up in a tiny house. Maybe they will be less inclined to have a lot of items around given their familiarity with smaller spaces and the reduced availability of items.

Modernization, smaller homes, and social class

I wanted to come back to a post from earlier this year where an economist argues that modern conveniences mean people can save money by living in smaller houses:

DR. SHILLER: Big houses are a waste. People are still in a mode of thinking about houses that is kind of 19th century. As we modernize, we don’t need all this space. For example, we don’t need elaborate kitchens, because we have all kinds of delivery services for food. And maybe you don’t need a workshop in your basement, either. You used to have a filing cabinet for your tax information, but now it’s all electronic, so you don’t need that, either. And bookshelves, for people who read a lot. We have electronic books now, so we don’t need bookshelves anymore…

DR. SHILLER: Having a big house is a symbol of success, and people want to look successful. People have to know about your achievements. How do you know, really? Who knows what people are doing in their day job? But you do see their house…

DR. SHILLER: When it comes to housing, there are books about this in the last 20 years—including “The New Small House”—that talk about designing houses to look impressive as well as function with a smaller scale.

Just like we’re developing Uber and Lyft and Airbnb using existing resources more efficiently, we can also build houses that are better at serving people’s needs without being big.

All of this could indeed be true. Many of the items people purchased just a few years ago may not be necessary. However: some of the services mentioned above seem to be tied to social class and age. Which people in society are getting all of their food delivered? How many people are doing all their taxes and bill paying online? Who needs space to store books, clothes, toys, electronics, gym equipment, etc.? Imagine a few scenarios of who might trade stuff for a smaller home:

  1. A downsizing well-off couple who wants to move to the big city now that they are empty-nesters.
  2. A recent college graduate who cannot afford a large residence but wants to spend money on cultural options and food.
  3. A professional who works long hours and does not want to care for a large residence.
  4. People who live the majority of their life through the Internet and their smartphone.

On the flip side, imagine people who might still want a larger home:

  1. A suburban couple with a child on the way who want more space for their kids.
  2. A young worker who has saved a little money, wants to put down roots in a community, and invest in something that will probably rise in value over the decades.
  3. People who like to have friends and family visit or who want to gain some extra income through hosting people.
  4. Numerous Americans who think a larger home is a better deal given that they can use the space, they like to buy stuff, and/or think that their home will appreciate in value.

In sum, I could imagine those who choose to buy smaller homes might be doing it for class/education/taste based reasons rather than just because they want a more efficient home. Those with more education might value a big home less. I would guess it will take time for many American residents to come around to the way of thinking that a smaller home is more efficient. In the meantime, there are still many forces still pushing people to buy larger homes.

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?

 

Recycling was only a band-aid; Americans need to consume less

Now that the recycled products of Americans are no longer desirable, perhaps it will start a new broader conversation: when will Americans consume less?

This end of recycling comes at a time when the United States is creating more waste than ever. In 2015, the most recent year for which national data are available, America generated 262.4 million tons of waste, up 4.5 percent from 2010 and 60 percent from 1985. That amounts to nearly five pounds per person a day. New York City collected 934 tons of metal, plastic, and glass a day from residents last year, a 33 percent increase from 2013.

For a long time, Americans have had little incentive to consume less. It’s inexpensive to buy products, and it’s even cheaper to throw them away at the end of their short lives. But the costs of all this garbage are growing, especially now that bottles and papers that were once recycled are now ending up in the trash…

The best way to fix recycling is probably persuading people to buy less stuff, which would also have the benefit of reducing some of the upstream waste created when products are made. But that’s a hard sell in the United States, where consumer spending accounts for 68 percent of the GDP. The strong economy means more people have more spending money, too, and often the things they buy, such as new phones, and the places they shop, such as Amazon, are designed to sell them even more things. The average American spent 7 percent more on food and 8 percent more on personal-care products and services in 2017 than in 2016, according to government data

But even in San Francisco, the most careful consumers still generate a lot of waste. Plastic clamshell containers are difficult to recycle because the material they’re made of is so flimsy—but it’s hard to find berries not sold in those containers, even at most farmers’ markets. Go into a Best Buy or Target in San Francisco to buy headphones or a charger, and you’ll still end up with plastic packaging to throw away. Amazon has tried to reduce waste by sending products in white and blue plastic envelopes, but when I visited the Recology plant, they littered the floor because they’re very hard to recycle. Even at Recology, an employee-owned company that benefits when people recycle well, the hurdles to getting rid of plastics were evident. Reed chided me for eating my daily Chobani yogurt out of small, five-ounce containers rather than out of big, 32-ounce tubs, but I saw a five-ounce Yoplait container in a trash can of the control room of the Recology plant. While there, Reed handed me a pair of small orange earplugs meant to protect my ears from the noise of the plant. They were wrapped in a type of flimsy plastic that is nearly impossible to recycle. When I left the plant, I kept the earplugs and the plastic in my bag, not sure what to do with them. Eventually, I threw them in the trash.

The whole American lifestyle revolves around consumption and includes innumerable objects that are difficult to reuse or refuse. Much of it seems to come under the ideologies of efficiency, cheapness, and convenience. Envision Walmart. It is not just about small items or particular companies; it even makes its way to some of the largest purchases Americans make including buying larger homes to store more stuff.

What would it take to start the ball rolling away from consumption of goods? A small set of Americans have voluntarily done this – I recall reading about downshifters in sociologist Juliet Schor’s twenty year old book The Overspent American. A major company like Amazon or Walmart could make a big dent. Or, perhaps some government regulations might help nudge the free market in the right direction. There is a slight chance a movement of conscious consumers could help lead to change.

And if consumption levels do end up dropping, this could effect all sorts of areas in American social life. What would happen to fast food? The smartphone industry? Housing? Carmakers? Food producers and distributors? Watching it all play out could be fascinating.

Of course Tidying Up with Marie Kondo starts in Lakewood, CA

In watching one of the popular new TV shows, Tidying Up with Marie Kondo, I was not surprised to see the first episode take place in Lakewood, California. Here are several reasons this makes sense:

  1. Lakewood is a paradigmatic suburb. It does not quite receive the amount of attention as Levittown but it is known as an important post-World War II suburb of Los Angeles. Read more about the suburb’s unique history on the city’s website.
  2. The home depicted is relatively small compared to many of the suburban homes constructed today. This is part of the tidying issues the family faces: the American pattern is to accumulate more stuff over a lifetime (partly to express a certain status) and one solution for adjusting to this stuff is simply to purchase a larger home.
  3. The family is depicted as living an ideal family lifestyle: they have been married five years (if I remember correctly), have two small kids, and live in a suburban single-family home. This family/single-family home connection is strong in the suburban psyche.
  4. The emphasis of the episode is on the private life of the family inside the home. Even with the show focused on the belongings inside the home, there is very little connection to the outside world, whether neighbors, or the larger suburb, metropolitan region, or nation. All these privately-held goods and familial relationships look like they are in a small bubble that the participants prefer to stay in.

Given the suburban emphases on single-family homes and consumption, perhaps it makes all the sense in the world to start such a show in a well-known suburb.