The New Status Low

May 26th, 2011

It’s some crazy times here in California. The land of the status symbol, the latest trends, the rich and the wanna-be rich.

It’s all screwed up now. But only in the way Californians can really screw it up. The real estate market, naturally, is behind it.

Flash back to the long-gone era of 2005. (a veeerrrry good year, most Californians agree). Everyone was remodeling their home. Putting in a Jacuzzi. Buying a Hummer. Going to Hawaii. Passing as much free time as possible at the mall.Everyone…from the CEO of a high-tech company to the plumber who unplugs your toilet… was feeling flush, thanks to the run-up in real estate.

With 100% financing, funny-money loans, and your house as your personal gold mine, everyone was digging it. Bigtime.

Buying a house…maybe two, maybe five…it was all so easy. Californians raced around in their shiny new BMW’s and Escalades, visiting California Closets and Neiman Marcus in between long weekends in Vegas.

OK, so I’m not telling you anything you don’t already know when I say times have changed.

But holy equity line, Batman, they’ve reeealllly changed. In ways the headlines don’t much talk about.

Everyone…and I mean everyone…from the CEO of a high-tech company to the plumber who unplugs your toilet…is feeling completely drained…thanks to the plunge in real estate.

But here’s the crazy California thing. Golden Staters have adjusted from the status quo to the status low – all with a strange sort of pride. Because everyone…and yes, I mean everyone…is either doing a short sale, foreclosing, or just generally walking away…or know someone who is.

It’s created a freaky kind of camaraderie, a kind of gallows mentality that’s binding us all together in a holy crap, can you believe this is happening kind of way. Californians freely share stories of their out of control loans, their upside down homes, or the poor forlorn bank-owned properties on their block (silent and sad, like orphaned children). They lament how the bank refuses to work with them…unless they stop paying. So guess what? A lot of them have stopped paying.

And the thing is, no one really cares. Because it’s become the New Normal.

There’s none of the age-old shame, the proverbial red X of the despicable Debtor upon their forehead. Even more, most people really understand. No looks of condemnation, no sneers of disgust at the Debtor. Most everyone just shrugs. And nods. And says yeah, me too.

Yup, it’s sure some crazy times here in California. But at least the weather is great.

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