- Lisa Katz sold her home for roughly six times what she paid for it 26 years ago.
- She's still struggling to buy a replacement.
- Here's Katz's recap of her experience selling her home, trying to buy, and pivoting to a rental.
- See more stories on Insider's business page.
Lisa Katz was one of the thousands of Americans to sell her home in 2021 and benefit from months of surging prices. But it didn't work out the way she imagined.
Katz, 56, and her husband started planning their move from their home of more than two decades in Los Angeles' Hollywood Hills to the coastal enclave of Santa Barbara in the summer of 2020, but their son's schooling and work plans delayed that.
She said the Hills kept getting noisier and more crowded, the opposite of what she sought some 90 miles up the coast.
The value of her Hollywood Hills home rose more than 500% over the 26 years the couple owned it, before accounting for taxes and fees. When she listed the property, she said it took just four days to sell.
"It's hard not to get caught up in it. It's like you're in a game show. You've been called down, you go running down the carpet, you're spinning that wheel," she said.
It only took a few weeks for that euphoria to fade. Now a buyer, Katz struggled to find a home that wasn't inflated in price. She and her husband decided to rent a home in Ventura, a mid-sized city halfway up the coast to Santa Barbara, less glitzy than their dream destination.
Insider spoke with Katz about her experience selling her Southern California home and how it was a "huge letdown" to learn, even after cashing out on her home of two decades, her dream house was still out of reach.
Now she's renting in a city where she doesn't know anybody, with no idea how long. Here is a transcript of the conversation, edited for brevity.
Ben Winck: When did you first start looking to buy a home?
Lisa Katz: We lived in our home for 26 years and finished paying it off about a year-and-a-half ago. It's a house in the Hollywood Hills, 1926, Spanish. It was really a great house, but I lost a lot of love for living in the Hills. The neighborhood changed quite dramatically over the last seven years. We'd find that it wasn't a family moving into a nearby home, it was 10 people moving into a home, to pay for the mortgage. It was just noisy all the time ... it became untenable for me.
My husband was not quite ready to retire. Our son was in high school still. So when it became serious for us to move was honestly when my husband finally got tired of hearing me complain. So we started looking about a year ago.
The dream was to move to Santa Barbara. That was just the place we always thought we'd end up. When we finally were ready to list our house was when I said to my husband, "It's now or never, it's a seller's dream market." And he heard me.
Winck: What were the first things you saw that made you realize that the market wasn't the same, and was so much hotter than before?
Katz: What didn't seem right was the polarity of it. I was almost like you pick a number out of a hat and that's what you can list your house for.
Our house sold in four days in June. We had two offers almost simultaneously. The first offer was $100,000 over asking. It was insane. And he wrote a letter - which apparently you're not supposed to do anymore - and it was lovely. He loved the history of the home. He loved the Spanish nature. He loved the view. I ate it right up.
But in the inspection period he got a little scared. He had never bought a home before. So he ended up ducking out. Our backup offer was much closer to our listing price. And we were fine with that.
So this market is totally insane. It's bananas. Just four days, and your house is done. We did have a 45-day escrow, which was awesome, but we ended up putting our house into PODS because we thought we might have to put everything into storage and rent a fully furnished house somewhere.
Winck: While you're still looking, right?
Katz: While we're still looking!
And let me tell you, buying is off the table. It's so inflated, it's crazy ... So I have been in this rental house for two weeks. It's in Ventura. We're so grateful, it really is a great house and I'm thrilled we're here. Santa Barbara was going to be too far and too expensive, even for renting.
Winck: And you first wanted to move to Santa Barbara when you listed?
Katz: About a year before we listed! We'd been considering this.
I talked to my real estate agent in Santa Barbara and she said there were just very few properties for sale and that prices were just skyrocketing. She said she'd never seen anything like this, and she's been in the business for a long time.
She said people are not selling their homes, they're just sitting on them. And when people do want to sell, it's like everybody is jumping on it. They're saying "zero contingencies. Zero appraisal. We'll pay for your move. Here's some money for your kid's college fund. Here's a new car."
She grew up in Santa Barbara and she said, "I'm freaking out right now. These properties are great, they're nice, but they're just not worth this."
Winck: Have you bid on any homes since selling?
Katz: We bid on one home, but we weren't serious about it. We let it go. We didn't want it that badly.
Winck: When you were selling your house, did you feel rushed to take advantage of the market situation?
Katz: Absolutely. I did not want to miss this train because I felt like we would find a buyer who would do exactly what our buyers did.
Our house was not a major fixer-upper, but being almost 100 years old ... it definitely had things that needed to be addressed. I know for a fact that, in a normal market, that would've counted against us in a much more drastic way. Now you have people saying "we don't care, it doesn't matter. We just want the house and we're willing to take it as-is."
It's like you're in a game show. You've been called down, you go running down the carpet, you're spinning that wheel. That's kind of how it feels.
Winck: Did you think the sale would fully offset the price of a new home?
Katz: We're both pretty practical people and we tend to be very cautious with money. We had a number in mind, and we were not ever willing to go below that.
But it's hard not to get caught up in it. It's like you're in a game show. You've been called down, you go running down the carpet, you're spinning that wheel. That's kind of how it feels. "They've written! Here's the number, tell her what she's won!"
Then again, the letdown happens when capital gains take a huge bite out of your winnings.
Winck: Can you walk me through the moment you decided you couldn't buy? And your decision to rent?
Katz: That was hard. That was a very sad day. Moving is very expensive, and obviously it's exhausting. And renting is just a very different experience from owning.
It's a huge letdown. You think that you're going to keep riding that train. "Oh my God, we sold! We have all this money in the bank." And now it's, "Oh my god, we are going to have to wait."
And I've heard so many different opinions on when the market is going to settle back down. We have, I think, two years to buy.
Winck: What would you tell someone if they came to you for advice on selling their home?
Katz: I would just tell someone to make sure you're selling for the right reasons. Make sure you're not just selling to make a quick buck, and make sure you really, really want to move. Because it's the Wild West out there.
Your house could sell like mine did in four days. Be very careful, and know exactly what your plan is. And also what Plan B is and what Plan C is.
With a number of the homes I have looked at - in fact, I'm going to say all of them - I walk in and I've been stunned. They're just not worth it.
I don't think my home was worth it. I don't know if I want you printing that!