The Economist last week ran a special issue about property, with special emphasis on the perils of this particular asset class. It was too bad, however, that the magazine did not take the opportunity to make the real point that the mortgage crisis should have made abundantly clear: investing in houses is disingenuous, because houses do not create or retain real lasting value. Communities do. This is why urban cores and inner-ring suburbs have weathered the recession better than exurbias, where housing is an interchangeable commodity and little else.
When a home functions within the ecosystem of a vital community, value is created and retained beyond the cost of framing, sheetrock, and labor. Unless a house is exquisite as an architectural object – and few are – its real and lasting worth comes not from a speculative market but a sustainable commitment to neighborhood and environs. Ta-Nehisi Coates captures this beautifully in his recent piece for The Atlantic about Detroit, poster child of urban decay which nonetheless retains dynamic communities of interdependent variables: committed residents and quality housing stock. (An expanded addendum to the piece is here; it is beautiful reading whether you come from the Rust Belt or not, and adds layers to The Urbanophile’s argument about generationally divergent experiences of the city.)