The Barn House (40 page)

For all that, the new construction had the virtue of being essentially citylike, no trifling achievement. This was most evident on the city's commercial streets. Twenty-five years earlier the common practice in Chicago had been to build a row of one-story shops with a parking lot in front—a strip mall, the kind of thing one might find in the suburbs. Now this was less prevalent. More commonly one saw apartments stacked over stores, a building type common before World War II but little seen since. High-density mixed-use buildings didn't represent any great conceptual breakthrough on the part of real estate developers—Jane Jacobs had advocated them in 1961. The difference was that now people would live in them (and banks therefore would finance them)—in Chicago, at least, they were part of the urban deal.

Occupying the condos were phalanxes of kids in town for their first big jobs out of college. As was true the world over, this group's arrival didn't occasion universal applause, owing to the oblivious sense of entitlement some of its members displayed. The term for the female offenders in Chicago was “Trixies,” who in the stereo-typical view were airheaded blondes who whined about their wedding plans via cell phone on the bus; Ned once referred to their backward-baseball-cap-wearing male counterparts as Lincoln Park meatheads.

I don't wish to exaggerate the failings of this much-maligned subculture. True, we now had the problem that, while the
ranchera
music in the building behind us had by and large died down, some obnoxious yuppies moved into a renovated two-flat down the alley and threw parties on their deck (and why couldn't
that
one collapse?) that entailed playing loud music till two a.m. and necessitated my calling the cops. There was also the ponytailed ditz in the SUV who gunned around me on Sheffield Avenue—Sheffield is a narrow two-way street—because I was too slow pulling away from a stop sign for her taste and she couldn't spare the additional two seconds it would take to reach a parking spot up the block, which spot she then pulled into headfirst without looking, with the result that she clipped the car parked astern and had her right taillight erupt in a burst of red plastic shards. Here was an individual, one felt, who wasn't long for the city, and maybe not long for this earth.

More commonly, though, you met people like the young guy who lived in the condo building next to my buddy Joe's renovated two-flat in outer Bucktown, with whom we spent a pleasant summer afternoon discussing the local real estate prospects, not that either of
us
had a clue, because he thought old houses were cool and it'd be fun to fix one up, and who were we to disabuse him? Perhaps he'd come looking for a party, but the city had sucked him in.

We had many such conversations with friends and neighbors—the local real estate market fascinated us all. Property values had continued their extraordinary climb; by the early 2000s many of us were paper millionaires and a few were just millionaires. A couple several doors down moved out of their house and invested well over $300,000 in a gut rehab that took the better part of a year; they moved back but decided they wanted to cash in, believing the run-up in price was a bubble soon to pop, and sold for $1.14 million, which they found disappointingly low. The new owner promptly commenced another round of renovations that he intimated cost around a half million dollars, among other things necessitating the demolition of a brand-new kitchen equipped with stainless steel Sub-Zero fridge and granite countertops; only a few months after the work was completed his firm transferred him to London and he sold for $1.75 million. Three blocks away someone bought a house roughly the same age as ours for $980,000, then tore it down so he could build new. (I liked the old place well enough, but admit the new one, which plays off its neighbor across the street in terms of color and mass, is a cunning piece of art.) Our own house was appraised at $1.6 million, almost two and a half times what we'd put into it.

We were baffled by these staggering prices. We'd been reading for years about overheated property values in coastal cities, but in Chicago they were new. We wondered where all the tycoons had come from who could afford to spend millions on a house.

It wasn't until we took to vacationing in rural Michigan, of all places, that I got an inkling what was up. In 2000, we began sending our kids to a summer camp in the northwest corner of the state,
⁹⁷
a classic midwestern landscape of dunes, water, and forest. After delivering the kids Mary and I spent a few days at a bed-and-breakfast in a hamlet called Beulah on the shore of Crystal Lake, which was separated by a narrow isthmus from Lake Michigan. Beulah, permanent population 367, was the archetypal upper midwestern beach town, consisting of sun-washed clapboard houses (on our street, anyway) with front porches overlooking the two-block-long downtown, a little park, and beyond that the beach. I thought it charming—possibly the least pretentious municipality I've ever encountered.
⁹⁸
Only gradually did the realization steal upon us that it and the surrounding region were among the most beautiful places on earth.

We were far from the first to realize this, we soon realized. Browsing around the area for a few days, we found not the Wisconsin Dells-type collection of T-shirt shops the vacations of our youth had taught us to expect, but rather a surprisingly urban level of amenities—good restaurants, bookstores, art galleries, and so on. Come lunchtime, for example, while I don't doubt we could have found a burger and fries if we'd tried, more commonly our sandwiches featured basil pesto and portobello mushrooms and other such stuff, none of which would be considered out of the ordinary in the city but was something of a surprise in the sticks. Upscale establishments of this sort, moreover, weren't confined to one or two towns; rather, there was an entire circuit, extending from, oh, Manistee up through Frankfort to Glen Arbor, and I guess if you were determined to take it that far, Charlevoix, Petoskey, and Mackinac Island. What's more, so far as I could tell, all this bustling enterprise had been accomplished without the intervention of national chain stores (the Starbucks nearest to Beulah of which I have definite knowledge was in Traverse City, forty miles away), marketing consultants, or—you'll excuse the hubris—us, by which I mean people from Chicago.

This requires a word of explanation. Chicago's influence extended a considerable distance into Michigan. The southwestern corner of the state, notably a string of Lake Michigan vacation towns that the real estate agents had succeeded in getting everyone to call “harbor country,” was part of metropolitan Chicago for practical purposes; you could pick up a Sunday
Tribune
at the corner grocery as far north as Saugatuck. Crystal Lake, however, was a six-hour drive distant. At the breakfast table in our B&B in Beulah, the other guests were from places like Flint and Ann Arbor and Grand Rapids, or sometimes Toledo or Phoenix or Gillette, and while they enjoyed our tales of walking to Wrigley and fireworks on the lake, we were clearly visitors from a distant shore. That's not to say we felt like intruders or in any way unwelcome; on the contrary, we were delighted at having been invited to a party that had been organized by someone else.

What puzzled us for a long time was who had organized it. I had the naïve idea at the time that a prospering hinterland required a prospering city—but Chicago was too far away. Detroit . . . well, our companions at breakfast, or at any rate the Michiganders, generally spoke of Detroit as one would of the departed at a wake. We met quite a few people from Ann Arbor, which from all accounts was thriving, but it remained a town of modest scale. Grand Rapids was larger, but still seemed insufficient to support such a formidable economic superstructure.

The truth (or so it seemed to me) didn't dawn on us till we began talking to the proprietors of some of the little restaurants and bakeries we frequented. Mostly they were young and well-educated, having graduated from the state's big universities. Equally important, they were entrepreneurs, looking to start small businesses, and northern Michigan (“up north,” in local parlance) was where they'd gone. My impression was that the decision had involved no close calculation of the prospect of X number of individuals with Y disposable dollars showing up. Mostly they just liked it there, opened a business, and hoped customers would show up. The young entrepreneurs were the product of an urban environment—you didn't learn about portobello mushrooms and snappy logo design kicking cowpies on the farm—and had taken a path that in principle wasn't far removed from that of an urban rehabber. The fact that they hadn't wound up in the city was irrelevant. They'd fallen under the spell of a place, made the choice to live there, and endured whatever hardships it entailed.

What I deduced from this was that a rural area could gentrify just as a city did. That in turn shed some light on real estate prices. When Mary and I browsed the vacation-home listings—strictly for amusement, since we could barely cover the mortgage on the house we had—we were struck by the enormous variation in pricing. A villa with a hundred feet of frontage on Crystal Lake might list for a million dollars, for example, while humbler dwellings not far away were going for relatively trifling amounts. Price disparities like that were common in the city, but we'd assumed they reflected differences in crime and poverty. Now we realized a simpler phenomenon was at work. People with money had set their sights on the limited number of properties they considered desirable—old houses on Chicago's north lakefront, lakeside cottages in Michigan—and had bid up the price.
⁹⁹

As for where all these people came from with a million dollars to throw around, well, that wasn't all that complicated either. We stayed one night at a bed-and-breakfast in an old Victorian mansion on a hillside overlooking Frankfort, Michigan, a pretty harbor town where lake ferries had once docked. The following year we were told the place had been sold to a wealthy businessman from Texas who meant to use it as a vacation home. How he'd found out about the area I have no idea. The point was, once a place achieved a certain cachet, the wealthy just showed up.

It seemed to me I now understood what was going on back home in Chicago. Property values naturally rose when an area became more desirable, and up to a point it was essential that they did; otherwise fixing up old houses and other properties to the level required made no economic sense. Eventually prices reached the point where new construction became viable—undoubtedly the city construction boom of the mid-1990s had begun partly because the potential selling prices home builders plugged into their spreadsheets reached the point that the minus signs on the bottom line disappeared. That in turn greatly simplified the problem of urban revival. At low moments during our work on the Barn House the chances of the city making a comeback seemed remote—no one with a choice would sign up for the grief we'd endured. Once rising prices attracted home builders back into the city, the problem solved itself. People who wanted to live in the city didn't need to fix up old houses; they simply bought new.

The downside was that the process didn't end with the initial run-up in property values—prices could continue rising for a long time. (In the sociological literature this is known as “super-gentrification.”) Eventually supply and demand would come into equilibrium, but given increasing affluence nationwide, pent-up demand, and gentrification's inherently slow spread, prices could easily exceed the levels that ordinary people could afford.

That had happened in Chicago, we now recognized. My brother, transferred to Nashville ten years earlier, told me moving back to Chicago was now financially out of the question. We ourselves realized we couldn't afford to buy a house in our neighborhood. Property taxes jumped across broad swaths of the city, leading to protests. We were insulated from this for a time by the historic-preservation tax freeze we'd earned for fixing up the Barn House, but eventually that expired, and over a period of a few years our annual tax bill tripled. I appealed three years running, getting a reduction the first time and denials subsequently. After the latest round of reassessments I considered appealing yet again and printed out all the proposed assessments for the neighborhood from the assessor's online database, then walked up and down the streets hoping to suss out the Byzantine classification system. Finally I concluded that on a comparative basis my assessment was probably on the low end and I'd better just shut up. The state enacted a cap intended to limit the amount assessments could increase each year, but that just postponed the inevitable. In the end, most people recognized, none too happily, that their taxes would go up.

We recognized ruefully that we ourselves were only transitional figures in the neighborhood's transformation. The first wave had been the creative types and free spirits who preceded us, with good intentions but little cash. The second wave consisted of undercapitalized rehabbers like us, who could afford, barely, to undertake major renovations, although the work might take them years. The third wave consisted of those with sufficient resources (thank God) to buy the finished job.

That was the point the Barn House's neighborhood had now reached. The thought gave me pause—it does to any rehabber. We hadn't been poor, of course, and the house's appreciation had made us unexpectedly wealthy, at least on paper. The people who bought it from us, though—anybody who could afford $1.6 million for a house would have to be rich to start with. Already the neighborhood had seen a few people who dwelt on this lofty plane—an actress, a rock star, a wheel in the world of finance. No doubt there would be more as time went on.

We comforted ourselves with the thought that this was Chicago, and not an especially fashionable part of Chicago at that. We lived in an interior neighborhood, not on the lakefront; if nothing else the mix of housing, with big homes like ours on the same street as apartment buildings and town houses, meant the neighborhood wouldn't become an enclave of the superrich anytime soon. Sure, the more decrepit multifamily dwellings might eventually be renovated and rented to lawyers and bond salesmen. But for now we had a good mix.