The Unappraisable Home Value

While this is the longest hiatus I’ve had since initiating this blog about 1 ½ years ago, I have a good excuse:

That’s not me, but this guy did a pretty good imitation of my crash: wheels up, face down, ribs no doubt saying a rude hello to some rocks. If I’d only act my age!

So, finally, onward.

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My uncle, Clyde Allison, passed away a few days ago at age 91. In reminiscing about him, I am reminded that one of the most important functions of homes is to be a place of comfort, security and peace for people in their senior years, through retirement and, with luck, until the end. Lost in the frenzy of the housing bubble and burst is the fundamental reality that real estate value isn’t always about dollars, but it is often nevertheless priceless to those who cherish having a place of their own.

Clyde was a fine man whose wealth was in what he gave, not what he got. He was a Presbyterian minister and the founder of “Trick or Treat for UNICEF”, which has raised ten’s of millions of dollars since it was started in 1950. He also had a long tenure at the Emerald Ave. Presbyterian Church, which is in an area of the South Side of Chicago that was notoriously gang-ruled and crime-infested, especially in the racially divisive 1960’s and 1970’s. I still have no idea how he managed as a white minister in those years, but there’s a clue in the story about how he once cleared an area of the main sanctuary for a boxing ring, giving a place for neighborhood hero and former Heavyweight Champion, Ezzard Charles, to give boxing pointers to the kids. Conflicts between the Bible and boxing probably didn’t seem so important under the circumstances.

Clyde retired to Lowell, Indiana with his wife Mary Emma and had lived there about 25 years. For Clyde, his home’s value was measured in the quality of life it offered him, defined on his own terms. It frankly wouldn’t have mattered to him what it was worth “on the market,” so long as it provided some basic comforts and a place for his books, his family, his ambitions and his many memories. He was especially fond of studying about China, where he, my mother and three other siblings grew up in a missionary family. His house worked perfectly: from it, he could explore the world that mattered to him in the way he wanted to, and it was to it that those who loved him came for frequent visits and family events. Because he and my aunt lived there, it was the “family seat.” Their home has been the center of activity for his immediate family, but was otherwise a place for their personal privacy and introspection.

This is what homes are about. This is why I build. While I take pride in the fact that our homes tend to significantly appreciate in monetary value, the most important aspiration of our work is the ultimate value it brings to the lives of people who live there. So many times, our clients come to us with important intentions for their new home, expressed in terms like, “our legacy house,” or “our last home,” or even “the place I only plan to leave in a box.” These jobs are always at the same time flattering and a weighty responsibility. Will our design, engineering and workmanship measure up? It’s hard to get the testimonials that would allow us to know for sure. Occasionally, a few of our homes are actually tested by natural events like high winds or snow loads and we do revel in those success stories, but the critical, more subjective time-tests are elusive tales indeed.

The home my uncle Clyde lived in until his final days isn’t notable or fancy in any way. What has made it their retirement goldmine was the simple fact that it is their home (they have owned it for many years) and that it could adapt to their increasing physical constraints, allowing them to stay in their own home until their last days. This is why homeownership got to be one word, and became permanently tethered to the concept of the “American Dream.” It is the essence of personal independence and freedom. It is all the comfort, self-assurance, dignity and wealth most people dare to seek.

My parents, like Clyde and Mary Emma, lived out their days in their own home. They had no secret bank accounts and no investment portfolio of any sort, but there was no sense of poverty either. They eked out the utility payments and taxes, ate inexpensively and always at home. They literally had nothing but their house, but from their perspective, that fact alone fulfilled their needs and desires and provided them with what they truly wanted year after year. It was essentially their blue-chip stock; it paid continuous dividends right up to the end. My siblings and I still marvel at how fortunate they were—and we were—that they were able to stay in their own home.

The bane of the housing bubble was that while it made some people wealthy, it made homeownership too expensive for many of those on fixed incomes and forced too many others out of their homes as their taxes skyrocketed along with the homes’ apparent value. So, affordability and lower taxes are silver linings of the housing bubble’s burst. People with no fortune but a house of their own in which to live out their days are not typically disappointed that its monetary value is diminished. The difference is hard on those paying mortgages, but a blessing to those who are only paying taxes and hoping, like Clyde and my parents, to stay in their home to the end.

On the broken fortunes of the present economic malaise, a new approach to building and achieving homeownership needs to arise. We know now that many of the other avenues to long term security are potentially ephemeral and undependable. Homes shouldn’t be like that. It is time to restore some of the old paradigms about the real meaning of house and home, while creating new ways and means for people to build something for themselves that will be the literal foundation for the final comfort and security they have worked through their lives to earn.

I will continue to write on this topic in upcoming blogs.