Book Review – House Lust: America’s Obsession With Our Homes

<i>Inspired by infomercial hucksters, a writer becomes a speculator</i>

By Daniel McGinn, Currency/Doubleday, 274 pages, $24.95

Reviewed by Dorn Townsend

Midway through the year he spent researching America’s fetish with real estate (and dizzying himself with visions of profits), Daniel McGinn, the author of “House Lust,” crossed the line between reporter and subject.

First he attends a two-day class, takes a test and becomes a realtor. Then, inspired by hucksters on late-night-TV infomercials, he attends a real estate seminar held in a hotel ballroom. It’s a transformative event for McGinn, who decides he now needs a piece of the action. He becomes a speculator and would-be slumlord in Pocatello, Idaho, a sunburnt college town identified by the Wall Street Journal as one of the housing markets where investors make up the largest percentage of recent mortgage applicants. In that unlikely place, he uses his book advance to launch his empire.

The career move fails to win points with his wife. She is informed of his real estate buys only after the Boston-based Newsweek reporter inspects his property via Google Earth satellites. Afterward, discussions about family finances falter. The Idaho home might someday provide cash flow, but McGinn’s impulsiveness undercuts his negotiating power at home.

He also travels to New York City, where he hangs out with Braden Keil, whose gossip column for the New York Post, called “Gimme Shelter,” tracks the world of glitzy big-city real estate.

But not all real estate entertainment is based on voyeurism. In “House Lust,” a good-humored and entertaining first book that will be out in December, McGinn shows that good real estate writing is also grounded in specific local stories. “House Lust” isn’t an account of the housing boom, nor is it a theoretical discussion about real estate economics. Instead, McGinn writes about the behavior of Americans gripped by a mania for real estate. He writes like a social historian, albeit one with an impish curiosity and willingness to follow each thread to the end.

What, then, is “house lust”? At its heart, it’s about status envy. McGinn defines it as: “If you can instantly identify whether a countertop is made of Argentine Balmoral or Giallo Imperial granite, you may have House Lust. If you’ve visited the Web site Zillow, which estimates home values, and plugged in the addresses of friends, co-workers and exes to see how much their houses are worth, there’s a good chance you have House Lust. If, upon hearing that a friend has bought a new home, you can’t resist asking its square footage, the lot size and the year it was built, it’s very possible that you have House Lust.”

Early on, McGinn acknowledges that real estate fever isn’t a new phenomenon. Yet he argues, convincingly, that the present spiral from 2001 to 2006 — which saw the average U.S. home rise in value by 56 percent — dramatically amplified our house lust. For many, to quote Tennyson, “proputty, proputty, proputty” is seen as a quick route to riches — and in some parts of the country, owners have seen their properties appreciate like dot-com stocks, even if now the fallout in the mortgage market is painting a bleak picture for real estate going forward.

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In the next eight chapters, McGinn takes readers on a from-the-trenches tour of the innovative, driven and often buggy methods that Americans deployed during the housing boom to scheme, shop, covet, snoop and turn (or try to turn) a profit.

He visits suburban McMansions built by Toll Brothers in Maryland and notes that only two countries, the United States and Australia, build new homes that average more than 2,000 square feet.

(New home sizes will probably be forced down by the tightening credit market, which makes large loans tough to get. A recent Wall Street Journal article said that median home sizes have started to shrink after achieving a near-record of 2,302 square feet in the first quarter, falling to 2,241 square feet in the second quarter.)

To better understand brokers, McGinn travels to New Orleans to attend the annual conference of the National Association of Realtors.

He finds a profession whose members are anxious about the real estate downturn. One successful broker advises the audience to pore over yearbooks and wedding guest lists to find clients.

McGinn spends a chapter dissecting the way television shows, celebrity real estate reporting and Internet blogs have turned real estate into a spectator sport. He runs through the remarkable story of the emergence of HGTV, noting ironically that the home and garden network deliberately chose to base itself in Knoxville, Tenn., whose inexpensive housing made it possible for the network’s young producers to afford their own homes.

A few pages are devoted to dissecting the appeal of Curbed.com, the innovative blog whose tart writing and images of buildings, often punctuated by accusing red arrows, have earned it plaudits and a devoted following. Yet, strangely, since the rest of “House Lust” has an admirable no-stone-unturned quality, little space is devoted to the recent flowering of alternative media outlets covering real estate. Alongside a rapid expansion of real estate-related shows like “Flip This House,” new blogs devoted to tracking the status and nature of local developments have emerged. But McGinn underplays this trend.

McGinn finished writing “House Lust” just as the subprime mortgage crisis began wreaking havoc in domestic housing markets. In the weeks afterward, he rewrote the book’s introduction and conclusion, taking stock of the unraveling.

By the end of this engaging book, McGinn has come to terms with his own housing lust and desire for quick profits. His rental units in Idaho turn into duds. One tenant breaks parole and is returned to prison. Another turns his apartment into a hub for local drunks. Most dispiriting of all, the woman he hires to manage his properties disappears with several months’ rent.

As a way to profit quickly, McGinn concludes that real estate is a mixed bag: People’s smugness about the “killing” they’ve made on their house usually minimizes the closing costs, mortgage interest costs, annual maintenance expenses and real estate commissions they’ve paid. It’s a sobering experience, and one that tempers his get-rich-quick exuberance.