It All Starts at Home

In the past few years, I have learned two important and somewhat surprising things about my personal relationship to real estate. The first came when I closed the door of my starter apartment, a 2BR/2BA condo in Greenpoint, Brooklyn for the very last time in?the fall of 2019. I had grown up there, in the sense that your 30s are the decade where you enter true adulthood—a blur of rooftop, solo cup parties, and baby swings. I remember taking a dramatic deep breath as I descended down the stairs a final time, waiting to feel something big.

Days and weeks went by. That feeling never came. As someone who is deeply sentient and tends toward the nostalgic, I was initially disturbed by this. How could I not feel a sense of loss upon leaving my home? After some distance and reflection, I have come to accept the fact that I simply do not have a strong attachment to place. For me, home is family and a state of mind, and yes, I care about whether I have enough space and am not staring at a brick wall, but other than that, I am fairly adaptable. I can make home.

The second lesson came recently house shopping in the Hudson Valley. I was looking at “projects” or “opportunities,” as we like to say in listing descriptions, when I was confronted by the fact that my fetishization of old, historic charm, was not only stupidly impractical, it was the financial equivalent of a money pit. It was as though someone had removed the rose-tinted glasses that made historic trim and original pocket doors sparkle with unicorns and rainbows, and I suddenly was able to see it for what it really was—a lot of time and money.

Housing supply is the topic du jour in real?estate right now. If you’re already tired of?talking about?inventory, at the start of 2022, then you best suck it up because it will be, possibly, our greatest challenge for several years to come. According to?The National Association of Realtors (NAR),?“at the end of December, the inventory of unsold existing homes fell to an all-time low of 910,000, which is equivalent to 1.8 months of the monthly sales pace, also an all-time low since January 1999.” While housing starts are on the up and up and home builders are making strides, it will still take awhile before they can even begin to meet demand.

So how did we get here and what does the?future look?like? Those are big questions and not ones that I am qualified to answer. But I can tell you that it’s not a problem unique to the United States. Housing shortage is a global phenomenon. Soaring purchase prices and rent increases are dominating local politics in London, Rome, Buenos Aires, Singapore, Seoul, Dublin and Oslo as politicians try desperately to come up with solutions. In the UK, one in three adults is housing insecure. That’s approximately 1.75M people without a stable, safe and secure home in?one of the?wealthiest nations in the world. It’s staggering! At the risk of egregious oversimplification, the common denominator is zoning. Zoning is a hot button word because it so often comes down to an us vs them, not in my backyard battle. But it is also a reflection of what we value as a culture and what our relationship to place is. And of course, this evolves from generation to generation. In the late ‘90s when my parents joined community activists to block a mid-rise new building from going up in their Carnegie Hill neighborhood, I didn’t really get it. Ask anyone who lives there today, if the building above Citibank on the corner of 91st and Madison ruins the neighborhood and I bet they would stare at you blankly. Just look at the recent Soho rezoning battle, the two sides were very clearly generational—the young want affordable housing and the old want historic character. (Again, forgive the gross oversimplification).

Perhaps the Japanese are on to something. Did you know that the average lifespan of housing in Japan is 30 years? That’s right, most homes are demolished after 30 years to make way for new. In fact, 87% of home sales in Japan are new construction. There’s virtually no resale market. What that means is that housing in Japan depreciates over time, just like a car. So they have a very different relationship to the old. Historic charm is not a thing for most Japanese home shoppers because banks often won’t lend for the purchase of a resale. They see it as a worthless asset. By incentivizing the new, Japan has also created a culture that reveres architectural innovation—something that the rest of the world has benefited from, albeit indirectly. Another thing that dominates Japanese architecture, and much of Japanese culture, is the concept of “uchi-soto.” Uchi describes home, inside and the familiar while soto is the outside, the formal, the unfamiliar. It’s the contrast of the in/out, the known and the unknown that define home.

Perhaps now is a good time to take inventory at home, to examine your own biases and your personal relationship to real estate. What assumptions and preferences, learned or inherent, do you bring to the table? Why do you value what you do? What is your uchi vs soto? We pride ourselves in representing our clients in a completely neutral, selfless way. In the pursuit of their happiness, we want what they want whether it’s old Victorian charm or modern new construction. That’s what we tell ourselves, at least. But there is inherent bias there and I think it’s worth examining. Because self reflection is critical to cultural evolution, and cultural evolution is a necessary step to solving our housing shortage problem. It all starts at home.?

Until next week,