From Foreclosures and Short Sales to Expensive Rents and Real Estate

In January of 2006, when my husband and I were looking for a condo to buy in the Lake Merritt area our real estate agent tried to discourage us from buying in Oakland.  She told us that Oakland was not a good place to raise a family. Oakland had long suffered from a stigma of high crime and a poor ranking of public schools.  We ignored her advice and insisted on keeping our search for a home in the neighborhoods surrounding the lake.  In March of 2006, we purchase a two bedroom condominium in the Adams Point neighborhood.  From 2001 to 2006, we had happily lived in the East Lake neighborhood (historically called Clinton Park) on the south end of Lake Merritt.  East Lake was predominately composed of Vietnamese and Chinese immigrants, but there were also African-Americans, African immigrants, Latinos, and Whites.  When we moved to Adams Point, we noticed the neighborhood had a larger White demographic but the neighborhood was still very ethnically mixed.  The neighborhood's ethnic mix as well as having students, working-class families, and middle-class professionals all living together was an important factor for us when we decided to purchase the condo.  We quickly fell in love with our home and we enjoyed the slightly shorter commute to our jobs in San Francisco.  At the time we purchased the condo, we were at the height of our careers.  My husband was working as an underwriter at a large insurance company and I worked as a paralegal at a law firm.

When the housing market collapsed, we were trapped into paying a large mortgage on a home that was quickly depreciating in value or face the risk of defaulting on our loans.  Soon the housing bubble led to the great recession and large numbers of good paying jobs were eliminated by companies in an effort to maintain high profits for their shareholders.  By 2009, the neighborhood soon became littered with foreclosures.  Every week, we noticed listings in the newspaper of home and condo sales for rock bottom prices.  We ourselves would not be able to escape the great recession; while I was home full-time to care for our 18 month old daughter, my husband was laid off from his underwriting job.  We found ourselves unemployed and with a huge mortgage to pay.  The banks (we were given two loans to pay for the condo) refused to negotiate.  After watching an unemployed neighbor go through foreclosure, we decided to call our old real estate agent to arrange a short-sale.  In 2012, we sold our condo for $225,000.  We had originally paid $439,000 for our condo.  We then were cast out into a difficult rental market.  The Oakland rental market had become saturated with people who lost their homes and now had to become renters.  There was also a small but growing number of individuals moving to Oakland from San Francisco for cheaper rents.  We lucked out and found an apartment in our price range in the neighborhood.

For the last two years, we have lived in our rent control apartment and watched the neighborhood change as the rents and real estate prices have gone through the roof.  Due to the large influx of people from San Francisco and long-time residents being shut out of the expensive housing market, Adams Point is suffering from a housing shortage.  We see more people with sizable incomes move into the neighborhood and this in turn is fueling the creation of high-end shops and restaurants in the area.  Landlords are now fixing up old properties so they can charge large sums of money for their rental units.  When my husband and I moved to Adams Point we saw a healthy vacancy rate and many people easily moved into and out of the neighborhood.  This has all changed. The biggest change to Adams Point has been the rapid transformation from a racially mixed neighborhood to a predominately White neighborhood.