The Death Of “The American Dream” – Housing Prices Continue to Plunge in Exurbs of Chicago

There have been a lot of news articles in the capitalist press here in Chicago claiming that the housing market here may have reached its bottom.

However, according to figures published today in the Chicago Tribune, it seems more like the housing market in Chicago is just standing around scratching its bottom.

In the three counties out in the hinterlands of Chicago – Kane, Kendall and McHenry counties – housing prices, most likely suffering from competition from the rising number of foreclosures swamping the housing markets locally and nationally, have overwhelmingly continued their multi-year decline.

So many people in the US have bought into the fantasy that “the best investment you can make is to buy your own home”.  This has never been true and it is certainly not true now.  The truth is that, historically, it is always cheaper to rent an apartment or a house than it is to buy a home.  Aside from the ability to move on practically a moment’s notice without having to first sell your house you gain by renting, the expenses of maintenance and taxes simply drive the real costs of owning a home far beyond what it costs to rent an apartment.

Of course, the people trying to sell you real estate will never admit this fact.  And the fairy-tale fantasy shared by millions of – what else can they be called? – brainwashed Americans, called “The American Dream”, leads them, lemming-like, to ignore the careful long-term economic studies proving that it is cheaper to rent, and to burden themselves and their families with overwhelming debt in pursuit of said dream.

Here are the numbers, which compare median home prices in selected towns and cities in McHenry, Kane and Kendall counties from Oct-Dec 2010 to Oct-Dec of 2011.  We have tried to show only those towns in which more than just a handful of homes were sold in both periods, in order to have enough sales to actually produce meaningful comparisons.

There are some outliers – places where, unaccountably, median home prices seem to have increased during the time periods studied here.  They really stick out in a sea of bad news; it is difficult to believe that those numbers are real.  Time will tell if these represent statistical anomalies or actual long-term signs of improvement.

This data was “compiled by Record Information Services from public records” according to the Trib.  “The data are based on deeds transferred during this period… Median price means that half the homes sold for more and half for less.”

The story these numbers tell is the brutal story of the death of the “American Dream.”  But then that’s the thing about dreaming: eventually, you have to wake up and face reality.  And the reality is: capitalism is a trap for the working class.

These numbers would indicate, as this week’s foreclosure data confirms, that there will be many more foreclosures coming up, as more and more American families are forced to either walk away from their upside-down mortgages or are driven into the streets by the banksters for falling too far behind on their mortgage payments.   It is a national tragedy, but one that could have been avoided if Americans did not have such a near-religious faith in the capitalist system.

Marxists have always known, since the mid-1800s – and have always and everywhere warned those workers who would listen –  that capitalism will never be made to work in the interests of the working class.  We have warned people and warned them; but in America, where anti-communism is a national religion and the word “socialism” is treated as a curse word, our warnings have fallen on mostly deaf ears for almost 2 centuries now.   It is indeed tragic that it may take a terrible experience like this current world economic depression – not the first of its kind, by far! – and the immiseration of hundreds of millions of workers before the working class may once again give the socialists a fair hearing.  The human cost – forget about the economic cost!  These numbers can be extrapolated into a human cost of grief, impoverishment, stress; the breakup of families and even murders and suicides – the human cost of the working class’ continued allegiance to the capitalist system has, once again, proved to be extremely high.

It is to the eternal discredit of the revolutionary workers movement in the US that we have not been able to win the working people to our banners in time to save them from this economic disaster.

McHenry County        Oct-Dec. 2010                                         Oct-Dec 2011

Municipality                 Units                 Median                            Units                     Median

Algonquin                       37                    $225,000                           58                      $191,500

Cary                                   28                    $183,000                           46                      $161,000

Crystal Lake                   99                     $188, 000                          98                     $161,500

Fox River Grove           8                       $217,250                           8                        $211,000

Harvard                           23                     $123,000                           16                      $105,000

Huntley                            55                     $218,000                           74                     $204,000

Lake In The Hills          45                      $175,000                          78                     $158,500

Marengo                          24                      $183,500                           20                     $118,750

McHenry                         83                      $168,000                           97                     $134,000

Woodstock                     44                       $150,500                          68                      $141,500

Kendall County            Oct-Dec. 2010                                         Oct-Dec 2011

Municipality                 Units                 Median                            Units                     Median

Aurora                              14                   $208,250                          15                          $184,000

Joliet                                 17                   $182,000                          21                          $164,000

Minooka                           8                      $174,500                          5                            $157,000

Montgomery                  46                    $179,500                         66                          $145,000

Oswego                             95                     $211,000                         121                        $225,000

Plainfield                          23                    $195,000                         29                          $190,000

Plano                                  29                    $132,500                         30                          $117,500

Yorkville                           61                    $198,000                         83                          $194,500

Kane County                 Oct-Dec. 2010                                         Oct-Dec 2011

Municipality                 Units                 Median                            Units                     Median

Batavia                            48                      $237,250                       77                          $225,000

Carpentersville            74                      $141,000                       67                          $112,500

Elgin                                 173                    $185,000                       225                       $172,000

Geneva                            77                      $325,000                       74                         $300,000

Gilberts                           26                       $217,500                       25                         $182,000

Hampshire                     21                       $200,000                      18                          $237,500

Montgomery                 18                       $132,500                       21                          $160,000

Saint Charles                 110                     $282,500                       129                       $229,000

Sugar Grove                   21                       $269,000                       26                         $185,750

West Dundee                  12                       $239,750                       10                         $218,750

[Source: Chicago Tribune, “Price Pulse: October through December 2011”, 13 July, 2012, based on data compiled from public records by Record Information Services]

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