Death of the American Dream

As the world flocks to Southern California, lured by vague promises of the glamorous lifestyles lived by the citizens of Beverly Hills - 90210, Laguna Beach: The Real Orange County, Three’s Company, and The Fresh Prince of Bel-Air, the demand for a physical piece of the pie keeps going up. A little chunk of uneven land in the right zip code, with barely enough space to fit a cramped two bedroom house and squeeze an Escalade and BMW 3 Series in the garage, can easily cost well in excess of one million dollars.

The people who were here before the latest land rush sit back and watch the annual rise in equity, using the money to buy newer BMWs, while the poor middle class schlubs struggling to make ends meet (realistically anyone making less than $150k per year), either become lifetime renters, shoehorn their wives and kids into little condos, or move their family to the distant land of Riverside County where they might be lucky to spend as many hours with their kids as they do in their daily commute.

In much of California, the American Dream of home ownership is dead. Even with the housing boom finally leveling off, the situation is too out of whack to be rectified. Say you’re a middle manager at a decent company making $80,000 a year; you’re college educated, you followed the prescribed formula for attaining the Dream, and you’re getting what many would consider a decent salary. The problem is, at best, you can maybe afford a $2500 monthly mortgage, which will get you a one bedroom condo (as long as it’s not too near the beach). Or maybe you can move to the ghetto and buy a run-down house (not a very popular choice). Most likely, you will keep renting, living like a little hamster on a wheel.

Now add some kids to that mix. What are your options now? Pack your things and say hello to the Inland Empire and a lifetime of traffic jams.

What happens when the majority of a populace becomes disenfranchised? When the people no longer have a stake in the society they live in? History tells us they revolt. How much further can we continue down this path before landlords’ heads begin to roll?