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A costly lesson in home ownership


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    Calvin Sangster looks out the window of his condominium in Boston's Mattapan neighborhood, where he saw someone get shot outside. That's when he realized his dream to be a homeowner was turning out all wrong.

    - Jess Bidgood / WBUR

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    Aneiya and Calvin Sangster, Jr., lounge in the condominium their parents are giving up to return to renting.

    - Jess Bidgood / WBUR

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    Ateiya Sangster and her daughter Aneiya, in the condominium they're leaving to get out from the burden of home ownership.

    - Jess Bidgood / WBUR

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    Boxes stacked under photos from happier times. The Sangsters are moving out of the condominium they thought was a stepping stone to a life of prosperity.

    - Jess Bidgood / WBUR

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    The Sangsters outside of their Boston home. Home ownership seemed so sensible and financially rewarding, but that wasn't their experience.

    - Jess Bidgood / WBUR

Calvin Sangster looks out the window of his condominium in Boston's Mattapan neighborhood, where he saw someone get shot outside. That's when he realized his dream to be a homeowner was turning out all wrong.

Ateiya Sangster and her daughter Aneiya, in the condominium they're leaving to get out from the burden of home ownership.

You can say this for The American Dream -- it has got staying power. The belief that owning a home is financially better than renting is still amazingly strong, even in the face of statistics like the one we got yesterday -- almost 94,000 families had their homes repossessed last month. That's about as good a lesson as you'll ever get that chasing the Dream can go very wrong very quickly.


By Curt Nickisch

Four years ago, Calvin and Ateiya Sangster had bought a condominium in Boston's rundown Mattapan neighborhood. They thought they were laying the foundation for a life of prosperity.

"By the time we started finding out a lot of things about the street, you know, it was kind of too late, we was already there!" says Ateiya Sangster.

Things like the man who squatted in the foyer of their building. Addicts rang their doorbell.

Ateiya says they would ask question like, "Do you have a dollar? Do you have two dollars, you know?"

One day Ateiya's wedding ring was stolen. But none of that compared to the summer day when they had their windows open. Ateiya and Calvin saw two people arguing, right outside, on the sidewalk.

"They just started fighting and tussling," says Calvin Sangster. "And once he had the guy on the ground, he pulled out the gun and started shooting him with it."

I asked where their daughter was at the time.

"She was actually laying, laying right in that room," says Calvin. "And that's where we were like, we can't keep her up here anymore. I can't wait to get off of this street."

Now Calvin wonders why they were in such a hurry get on this street. Why they were in such a hurry to buy. Their first child was boy, Calvin Junior, or C.J. He when was born, they were renting from Calvin's grandmother. She lived on the next floor. His mom around the corner.

"I was very content," says Calvin.

The couple was planning to buy someday, but they had it good -- a big two-bedroom apartment for $800 a month -- that's cheap in Boston. Calvin was training to be a union electrician, and Ateiya was working. They were putting money away. Not bad for a 23-year-old dad and 20-year-old mom.

Then, one day, Calvin's good friend came over, C.J.'s godfather. Calvin remembers how this friend had just become a realtor.

"And he's like the mortgage probably won't be too much more than how much you're paying now. And I'm like really? That's when I started getting drawn in. Then he started saying all the pluses to owning. Me and my wife started discussing it. You know, she was very wary about it at first but you know, I talked her into it. Dumb me," says Calvin, laughing.

The condo seemed nice. One hundred seventy-thousand dollars seemed like a good deal. But after moving in, they found otherwise.

Once they moved into the condo, things started falling apart

"The house is like settling," says Calvin. "See, like the house is kinda slanted this way. Because the floor became uneven, the tiles started cracking."

Calvin and Ateiya were paying $700 more to live here than in their old apartment, almost twice as much. And then, many thousands more in repairs and renovations: appliances crapped out, doors wouldn't close, mold bloomed in the bathroom.

Two years in, their interest rate jumped. Calvin and Ateiya refinanced to get a fixed payment. Now they owed more, $190,000. But they were still hanging onto a dream they knew so well but didn't understand: the dream of home ownership. Financially, they were making it work. Calvin's pay had almost doubled when he finished his training as an electrician. As long as he kept his job, everything would be fine. But then...

"My foreman comes: Calvin, I need to talk to you. Ugh, I couldn't believe it. I knew what was coming, because he never talks to me," says Calvin.

Getting laid off meant there was no money coming in. Only going out. Month after month, one thought kept coming back to Calvin: Just how much cash they'd have in the bank, if they'd just kept renting from his grandmother. That vanished number amazes him still today. He figures: it's about $80,000. And it pains him, too. Because $80,000 happens to be about all his condo is worth today, not even half of what he owes.

"I've been regretting owning for a long time now. I regret owning," says Calvin.

For a long time he knew he was going to have to decide, how to get that debt, that regret, off his shoulders. He had to make things better for his family.

Last year, Calvin and Ateiya decided: They stopped paying the mortgage; they'd give up the house.

Recently, the couple moved back into the same building where they used to rent. Grandmother's still on the next floor. Rent is still $800. Calvin's mom still lives around the corner. She says Calvin is learning and maturing, and she's proud of him for that.

At first, Calvin felt like he was going backwards, losing the home. But now, he feels like he took a big step forward going back to renting.

"Back at the bottom of it, but I feel more comfortable being at the bottom of the stepping stone than where we were," he says. "I feel much more comfortable coming back here.

It was a costly lesson. Calvin and Ateiya Sangster had to give up their own place in order to come home.

Calvin Sangster looks out the window of his condominium in Boston's Mattapan neighborhood, where he saw someone get shot outside. That's when he realized his dream to be a homeowner was turning out all wrong.

Ateiya Sangster and her daughter Aneiya, in the condominium they're leaving to get out from the burden of home ownership.

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it's only quite recently that "the American dream" has ever meant "owning your own home." (I first met that idea in an ad on this program.) "The American dream" *used* to mean starting at the bottom and ending up at or near the top due to your hard work, diligence, and talent--something that isn't possible in most of the world even for a family over several generations, but was possible in America in at most two or three generations. Instead of lamenting "the loss of the American dream" because real estate prices are becoming a better approximation of actual value, how about refurbishing the older and better meaning of the term?

1) an investment is something you buy when prices are low, and sell when prices are high. Why buy a house when its overvalued, just b/c some "expert" says so?

What happens when you try to sell your primary residence when prices go high? You live on the street, that's what. Unless, of course, you buy a new house--when prices are, of course, high.

So much for profit.

2) Houses are equity? What do most people take out home loans for, anyway? House repairs. Oops. Vacations? How dumb--if you saved the tax and insurance and maintainance money in an interest-bearing account, how much of a vaction could you afford? How much money would you need to start with?

Oh, you want to take a loan for college? Well, if you don't own a house, would you need a loan, or would you get a grant?

3) If you lose a job in the town where you own a home, and a good job can be found far away...how hard is it to sell that house and move? Is it harder than giving up an apartment, and moving to where the jobs are?

4) If your apartment needs repair, does your landlord probably already know who in town does the repair job well? Does your landlord have a better idea than you?

5) When you pass away, will your children fight over who gets the apartment?

One thing left out of this excellent story: where did their down payment money go? Who profits from the sale of their home? The scoundrels who got us into this are walking away with short term profits and have defiled the American Dream.

I was amazed when I heard this on Fridays show: "The belief that owning a home is financially better than renting is still amazingly strong, even in the face of statistics like the one we got yesterday -- almost 94,000 families had their homes repossessed last month." I hadn't realized renters never lost their homes. I also had no idea that I too could be as lucky as the couple in the story, and have their grandmother rent me an apartment for much under market value (as your commentator pointed out the couple was paying). Given these two amazing 'facts', as per the story, why would anyone be so silly as to do something as financially irresponsible as try to own their own home?

It's been many years since I owned a house. I've been a renter since then. Now and then I feel a little stigmatized -- renters are, like, transients. But then I think of all the hassles I've avoided -- a mortgage, insurance, taxes maintenance, tying up capital. And of course, the current crisis. For me it's make one payment a month -- the rent -- and have the same rights of possession as an owner. Plus, if I decide to, I can just walk away. (I've been month-to-month for 10 years.) My landlord is happy at his dependable cash flow, and I'm happy with the simple payment and not being tied down.

A few years ago I began noticing a huge disconnect between the housing market and the rental market, that, despite the come-on of the realtors, one could rent far cheaper than own. I later found out that this disconnect is what causes insiders to bail.

Don't be conned. A house is like art. NEVER buy it as an investment. NEVER! Like the art you buy to enjoy, buy your house to make it a home, not make money off of. If the market goes up, and you're ahead, fine, but remember, everybody else's house has gone up, too, so what are you going to buy next? Think it through!

Very Painful story. I wish I could have helped people in such fate. But I too am not in a position to be it.
It is not clear from the story if their $80000 to start with still exists or gone.
Sincerely and painfully
Atul

Thank you for the story on the American Dream and the young couple in Boston. We recently went through something very similar with a home we owned in Maryland for 5 years. We ended up, after 3 years of trying to rent or sell it, settling for a short sale where it sold for less than half of what we bought it for. We lost over $50,000 in the deal, and are now, also happy as clams just to rent a small house for the next several years. Your story humanized the downfall of the housing market and was something a lot of us can relate to. Thank you!

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