Many San Diegans Struggling to Get By

By Joanne Faryon / Investigative Reporter, KPBS Public Broadcasting

Published October 21, 2008 at 7:01 PM PDT

This story was published more than 16 years ago.

Fewer people in San Diego are getting by financially because of the mortgage meltdown, lack of good paying jobs, rising cost of food, gas and rent. In fact, it takes people in San Diego County twice a

This is a story about Shelly, Thomas and Tavish Courtney. And the house they bought.

The house was on top of a mountain. The mountain was at the edge of San Diego County. And San Diego County was the place Shelly and Thomas had dreamed of owning a home.

Thomas Courtney: My dad does title examining, my mother was a typist, but they owned a house and when I became a teacher and I married an archaeologist I thought, “Gosh, we're really going to own a house.”

Shelly Courtney: We saw this one driving by. It wasn't listed yet but it had a “for sale” sign. I looked at that web page that it was on and it looked cute.

Thomas Courtney: Everyday before I went to sleep I thought to myself, “I want my son to have what I had growing up.” And he doesn't have it now.

In 2004, Shelly and Thomas bought this one-bedroom house on Palomar Mountain for $239,000. At the time, it was one of three houses in the entire county they could find in their price range. Relieved they had bought into the market before they were priced out - they settled into what they thought would be middle class family life.

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But for the Courtneys, homeownership soon became a curse, the mountain their captor and the commute torture. They never foreclosed - that might have been easier. Instead, the Courtneys held onto a house that cost them thousands in car repairs, kept them in traffic for hours a day, and strained their marriage. It even kept them from their son.

Shelly Courtney: I really felt for a while there that someone else was raising him. And not just the normal guilt that some moms feel when they're going back to work but definitely this extreme guilt because she was literally even doing his laundry. She would have clothes there that I'd never even seen him in. I remember him outgrowing clothes I never even saw him in because I saw him in pajamas.

The Courtneys may have only wanted what their parents wanted, but a new study from the San Diego Association of Governments says that goal is getting more difficult to achieve. In the rest of the country, on average, each generation lives twice as well as their parents. In San Diego County, it takes us twice as long or two generations to surpass our parents' standard of living.

Owning a home in San Diego never used to be this hard.

Let's go back to 1970.

Prices were higher in California than the rest of the country.

According to the U.S. Census Bureau the median price of a house in 1970 was $17,000. In California it was $23,000. A 35 percent difference.

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But something happened over the next several decades that saw that differential nearly double. By 2000, the median house price in San Diego County was $234,000 - the national average, $147,000. A difference of 60 percent.

The experts say blame it on two decisions: Serrano versus Priest in 1976 and then Proposition 13, which was passed in 1978. Together they redistributed and limited property tax increases - taxes that until then went to cities.

Marnie Cox: Along came Prop. 13, which here in California meant, what we're going to do is we're going to take property, about two-thirds or more, property tax away from local jurisdiction and we're going to give it to the state.

Marnie Cox is an economist with the San Diego Association of Governments. He grew up in California and has been with SANDAG for 30 years. He's seen our skyline expand and our county sprawl.

Cox says Serrano versus Priest and Proposition 13 discouraged cities from building more houses because they diverted property taxes away from local governments. Property taxes are levied against homeowners. Those taxes use to benefit municipalities directly. But under California law, two-thirds of those taxes now go to the state and are redistributed among all school districts in California equally.

Cox: But when that occurred, it also affected local jurisdictions land use decisions. Now, where it used to be that the major contributor of revenue through property taxes was from houses, that was no longer true. And so houses fell into disfavor.

Cities approved fewer housing developments and the ones that were built took longer. Instead, local government encouraged other kinds of development - things like retail, hotels, and a convention center. All of which generate more tax revenue.

The impact: Today, San Diego County is short 100,000 houses. Economists we spoke with say the law of supply and demand is the chief reason houses here cost so much more than just about anywhere else.

Thomas Courtney: I believe the county line is somewhere in between the mountain and Temecula.

But San Diegans don't give up on owning a home that easily. If there aren't enough affordable houses where they live - they'll move, and stay as close to the county line as they can.

Cox: There was a time, and I think it’s still prevalent with some people, that we could stop growth. People still believe if you don't let that building permit out you can stop growth and so if you stop growth you'd be able to make sure that new housing unit isn't needed. Well this is an illusion. In fact what has happened is that part of the reason for urban sprawl is because you don't have enough housing units in this city and so it's just moved to the next city and been created there.

In San Diego, even if you don't build it, they will still come.

Shelly and Thomas Courtney were willing to move up 5,500 feet and live on the edge of a mountain. There was snow.

Thomas Courtney: I came out and had no idea what to do. I was freaking out. I didn't even know if we had a shovel. There was snow past the tire.

And wildlife.

Shelly Courtney: We had a mountain lion that lived in our backyard. So you would leave on all your lights on your patio to get to your car, and yeah, it was really scary.

It was expensive.

Shelly Courtney: The mountain eats tires. Tires and brakes.

The Courtneys went through three cars, several repairs, eight new tires, and so many new brakes Thomas learned how to change them himself.

In 2004, when the family made the move, the cost of gas was $2 a gallon. By the time they moved out of the house in 2007, it was $3 a gallon. By the spring of 2008, it was more than $4 a gallon.

But the most difficult thing was the time away from each other. Their infant son was at the babysitter's, in the car enduring a minimum 90 minute commute each way or in daycare.

Faryon: You said you picked him up in set pajamas, were you feeling guilty?

Shelly Courtney: All the time. All the time. Um. He was with somebody who loved him and you know she's definitely part of our family. And I always felt safe and comfortable. I was never worried in that sense. I know some moms have to worry about leaving their kids with a stranger, so I was really blessed that I knew she was going to take awesome care of him. But, yeah so guilty. So you would stay up late, keep him up late so he could do stuff with me but you're just cranky. And then you'd try to get as much as you could done in the weekend but—Yeah. I honestly, when I went back to work full-time, I didn't think I was going to make it. I would end up crying at work. I work Monday through Thursday, 10 hours, and by Wednesday I would be in tears, at work and have to hide it. It's really embarrassing. I know my coworkers must have thought I was this lame emotional mom but literally I hadn't seen my child since Sunday. So, yeah, it's a really bad memory actually.

The commute nearly drove them both to a breakdown.

Shelly Courtney: I'll never forget in my little red geo storm. It was after six months of driving. I was on the 15 for three-and-a-half hours knowing I still have an hour once I get to Escondido and I'm sitting in traffic and I just slammed my hands in the middle of nowhere, slammed my hands down on the steering wheel. Ahhhhh.

While the Courtneys were stuck in traffic, others were trying to get into the housing market. The sub-prime mortgage market was in full swing, allowing people who couldn't afford to own a house to buy one anyway. And San Diego was leading the way.

According to Data Quick, a company that monitors real estate activity across the country, the median price in San Diego peaked in November of 2005 at $517,000. The rest of Southern California caught up in March 2007, peaking at $505,000. By then the San Diego market was already on the down swing.

Murtaza Buxamusa is with the Center for Policy Initiatives in San Diego.

Murtaza Buxamusa: San Diego, especially in its peak, 2005 was quite unsustainable, the bubble. In other words the wages and the earnings were not sufficient to be able to meet the cost that was demanded for this unit.

Of course, you know what happened next.

In July 1998, there were 2,126 foreclosures in the county.

In July of this year, there were 9,519.

Jennifer Trombly: It seems like every time I go, they’re more expensive, you know? And you try to keep your little preferred card, but that still doesn't do much, you know? It's still…Even diapers, in the past ten months, having my son, have gone up.

If the demise of our economy all began with housing, things only got worse when the price of gas and then food, went up.

Jennifer Trombly is 21 years old. A new mother. Married to a 23 year old Marine.

Jennifer Trombly: I try to make a lot nicer meals at home. Um, and then we cut a lot of coupons. We, even though we shop at the commissary, we browse like the Vons and the Albertson's flyers that come in the mail, see if we can get…their meats will go on sale. Sometimes, it will actually be cheaper than the commissary; their actual sales. So, we penny pinch. We buy a lot of off-brand foods, stuff like that. We shop at a local farmer's market right here, we're lucky to be right next to one. So, we get our fresh stuff a lot cheaper.

Jennifer's husband makes $50,000 a year. That includes his allowance for housing. They pay $1,745 to live in this 900 square-foot townhouse in Tierra Santa.

After utilities, gas and food, there's little left or sometimes, like last month, there isn't enough to last until the next pay check.

We found Trombly using a Twitter search. Twitter is another online way to chat with people. We went online and searched for twitter chatter using the key word money. Jennifer was talking about looking for change to buy baby food.

Faryon: So quite literally, I mean, really? Were you quite literally looking for change?

Jennifer Trombly: Pretty much. Yeah, um, I was scrounging for change, pulling out of the change jar, getting all the quarters and dimes I could. But we had a really hard month. Our paycheck came early the last time so we really had three weeks, instead of two weeks, in between a paycheck, so this was an especially hard month. And we just got paid today; I'm completely relieved for now.

Back in 1970, remember, before house prices escalated, a gallon of milk cost about $1.15. Today, it's about $3.50 a gallon. According to the USDA, all food prices have increased by 6 percent over last year. If it continues at that rate, it will be the highest annual increase since 1990. Things like eggs and cheese have seen double digit increases.

Trombly and her husband have found creative ways to stretch their shrinking dollar. He works on weekends as a mover for U-haul and cleans houses.

And to pay off credit card bills…..

Jennifer Trombly: My husband was donating plasma to pay them off, just the extra $25 a month, to pay that credit card off, it was hurting us. They take your blood out and they take the plasma out of it and they put the blood back in you without the plasma. I think he did it somewhere around eight times but it was good money.

According to the U.S. Census Bureau, one in ten people in the county live below the federal poverty level. That amounts to about $10,000 a year for a single person.

But most economists say the federal poverty level is an outdated and meaningless way to measure true poverty in San Diego County. Economists here double that $10,000 and if you use their calculations, one in four people live in economic hardship.

Murtaza: It's not “in-your-face” poverty. It is a different kind of poverty. It is a poverty you are struggling to make ends meet and not being able to pay your bills on time. It's almost like being on a treadmill and not being able to keep up with the pace of the treadmill that is increasing all the time. It’s increasing so fast that at some point people start falling off.

According to SANDAG, back in 1972, the average wage in the county was 30 percent higher than the national average. In 2005, it was only 5 percent higher. And now, for every one high paying job created in the county, there are eight low paying jobs.

The disparity shows up in our neighborhoods.

According to the U.S. Census Bureau, Rancho Santa Fe has one of the highest family median incomes in the country at more than $196,000 a year. Drive less than 30 miles to the other side of the county and you'll be here, in Barrio Logan where the median family income is $24,000.

And according to the 2006 U.S. Census data, while the county's median household income did rise in 2006, most of it went to wealthier households.

The Center on Policy Initiatives says nearly half of all the county's wealth went to the top one fifth of the population.

Murtaza: The difference we see between 10 years ago and today in terms of the bottom is that they have a lot more company. The people at the bottom, the issue of the shrinking middle class is that a lot of people are being squeezed into the lower class, where they're struggling to make ends meet. And that is a reality facing San Diegans every time they go to the gas pump or the grocery store. And it's a trade off every single day of our lives between paying bills of electricity and gas or buying medicines -- it is pretty tough times.

Add together an increasing unemployment rate, the high cost of living and too many low paying jobs and you end up here….

In a lineup for food.

Faryon: Is this just the beginning that we're seeing?

Chris Carter: If more and more middle class families are losing their jobs and continue to lose their jobs we will see that demand increase exponentially.

Chris Carter works with the San Diego Food Bank. He left a job in London, lobbying Parliament, to work here. A scholarship got to him to London as a teenager, but he grew up poor in Alabama, with a single mother.

Chris Carter: I would save my milk from school lunches to give to my younger sister after school when my mother came and picked us up because she would always cry because we didn't have enough food to feed her. I remember going hungry on weekends and it’s so tough...It really is and I know what these people are going through because I've experienced it myself first-hand.

In La Mesa, demand for food from the food bank increased by more than 100 percent between January and July. In Spring Valley, demand is up by 69 percent. In Chula Vista, 34 percent.

Demand for this state sponsored supplemental food plan is so high, the food bank, which helps administers the program, has been told to stop taking new clients.

Sixty-seven-year-old Ramona Rodriguez is a volunteer at her neighborhood community center in Logan Heights and a recipient of the supplemental food program.

Ramona Rodriguez: Gasoline is so high, food is so high everything is so expensive and the check’s the same, we don't have increase on the check. I mean we're running all this because of the gasoline, but the check…Are they going to increase them? I don't think so.

Seventy-three-year-old Simona Luna is at the front of this line. She receives about $800 a month on social security. Her rent is $500 a month. She also has to buy a bus pass so she can get to the hospital for her cancer treatments.

Faryon: Will this food last you for a month.

Simona Luna: Yes, uh huh. A whole month, yes…It helps.

Luna buys toilet paper and coffee, but mostly survives an entire month on this box of food.

Faryon: Getting by like that every month, does it upset you?

Simona Luna: No. No, I don't get like that.

Faryon: How come?

Simona Luna: The doctor, they told me, “You are a brave lady.” I am strong. That's why.

Faryon: What do you think has made you so strong?

Simona Luna: Before I been living years many for my children when they were small. I think I get strong because before I not have too much help those long years I don't have too much help. Just me. I'm a man; I'm a woman for my kids.

Faryon: You raised them on your own?

Simona Luna: Yes.

Faryon: How many?

Simona Luna: Six.

Faryon: So it was harder then?

Simona Luna: Yes. It was hard. And I was working on California laundry before 29 years. I was a presser.

Faryon: And that's how you support your kids?

Simona Luna: That's why I have this arthritis because the laundry was too hot. Too hot.

Faryon: Compared to that, life is good now?

Simona Luna: Yes, I still have the cancer but I feel okay.

"Single moms with children makeup the largest percentage of families in poverty in the county at 29.9 percent. Single women are second at 15.3 percent." (Source: U.S. Census Bureau)

Just how did this story begin with a dream of homeownership and end in poverty?

We wondered that too….And we found our answer in a 2008 San Diego Association of Governments Prosperity study. Although don't let the name fool you.

SANDAG looked at how we compared with 20 similar regions, places like Seattle and San Francisco. When it comes to wages, we're in the middle. Our wages have increased at an average rate compared to other cities.

But our cost of living has increased faster than just about anywhere else. We're the third most expensive place to live of those 20 regions. And the biggest reason is housing. In the late 90s and through the early 2000s, San Diego families began paying as much as 50% of their gross salaries on house payments.

Now when you put one over the other…we end up here…dead last, the least affordable place to live.

The report says a high cost of living and low wages is a "corrosive combination eroding our region's purchasing power."

So while we like to think it's really the so-called sunshine tax -- the beaches, the beauty, the weather that drives prices up and wages down -- economists say it's a myth.

We haven't built enough houses and we've created too many low paying jobs - ironically jobs in the service and tourist industries - industries that can only thrive in a place this beautiful with this much sun.

Marnie Cox: In your overall economy what's really important is the wealth of your households and so it doesn't take a rocket scientist to figure out for each job that I'm generating in the visitor industry that is constrained from paying anything above $24,000 a year and the average wage in the region is 40,000 a year, that each job that I add brings down the average, so the wealth of your community is really locked into your household income.

Thomas Courtney: Let’s get him.

Remember Shelly, Thomas and Tavish? They moved out of their house on the mountain last year. They now live in this tiny two bedroom apartment in Bay Park.

Faryon: Are you happy now?

Shelly Courtney: Oh yeah, definitely. Of course there are some things. Like I wish we had a garage, but yeah, I'm definitely happier and definitely happy, yeah. Without a doubt. I read my kid a bedtime story every night and we have dinner together every night and we even do something else whether it's watching a show or going on a bike ride or swim lessons. We do something every night. I mean, we cook. We cook and we actually eat on our table. It's amazing.

The Courtneys never foreclosed. They never even sold. They couldn't. The market crashed.

They continue to pay their rent and their mortgage, barely getting by with the help of some renters who pay a nominal amount to live in their old house.

But Thomas, he can't seem to let the dream go. He still comes up here and works on the property. He's a volunteer firefighter and even saved his house from burning down in the wildfires last year -- a month after his family had moved out.

Faryon: You saved the house that was ruining your lives, your family life, it could’ve burned down, you would have been free, you wouldn't have owed any money, you would have been free of all this.

Thomas Courtney: Not free of my work and our memories. There was a lot of hard times. We had a lot of nice times; sledding, what Charger games, third birthday tree. Someone will enjoy this home. It's a great home. It’s great house. It will be a great home for somebody.