His partner died a few years ago and he's been living all alone in his big, beautiful house, his voice echoing in the grand entryway. This summer, he decided it was time to downsize. A new family is moving in and all the neighbors are planning a dual farewell-welcome brunch for both parties. (I'm bringing banana bread.) In places like Miami, London, New York, and California, however, this Hail and Farewell routine isn't always the case.
When homes go on the market, they're snapped up, often by anonymous cash buyers. The neighbors, waiting for a moving truck and ready with a plate of warm cookies for the new owners, are left crestfallen. A recent New York Times piece dove into how this trend is disrupting local markets.
When I lived in a certain Northern California neighborhood, ghost houses were common. On streets with tidy yards, Welcome signs on the front doors, and Priuses in the driveways, the ghost houses stuck out. Overrun with weeds and shadowy, they were empty and looked sad.
In one case, a family purchased a large house just so their overseas relatives would have somewhere to stay when they visited. I actually met the couple who sold said house, and they were clearly conflicted with the sale. The woman lamented about the fact that there were no holiday lights up or decorations adorning the house anymore.
"We would put up tons of lights and a big Christmas tree in the front room every year," she said. "When we drove by over the holidays, it was dark and empty."
But rather quickly, she followed up with the fact that they made bank on the sale. Her story is not an uncommon one.
In 2016, foreigners dumped $153 billion into the US housing market. And there's evidence that the purchasers are, sadly, not families looking to buy a forever home.
According to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, home prices continue to soar, with Seattle, Denver, and Portland reporting the highest year-over-year gains. The gains are good for sellers but bad for local buyers. Such hot markets might also attract foreign buys too, from those who are willing to plunk down cash knowing it's safe.
But what happens to local neighborhoods? How long until the roof begins to sag and the house earns a nickname. As an HOA, can you act on this? Not likely. But it's all the more reason to keep residents informed and engaged. With FRONTSTEPS HOA software, you can build a community website and remind the people who live down the street and around the corner that, while your house is an investment, your neighborhood is your home. Then, when your sweet neighbor, Dana, says he's moving, there are families waiting in line to make an offer. The same families who've been driving by on weekends hoping to see a For Sale sign somewhere, anywhere in the neighborhood known for welcome brunches, progressive dinners, and community reimagined.