Mollie Bell has a plan the next time a real estate infomercial flashes on her TV: She's "flipping to the cartoon channel."
After being burned by a negative-amortization loan that left her owing more on her Compton home than it was worth, Bell, 62, has soured on the home-refinancing craze. Never a big spender anyway, she has clamped down even harder -- deferring painting and other repairs on her modest three-bedroom home. Sadly, she's also postponed retirement.
"From top to bottom, I'm reexamining how I spent before, and am trying to save at every turn to put away 10% a year. I [hadn't] saved for an economic Katrina."
Americans' long love affair with debt is cooling off a bit. The Federal Reserve reported last week that the amount Americans owe on credit cards, auto loans and other forms of consumer loans dropped for a sixth straight month in July, the longest decline since 1991.
It's the same story with home equity lines of credit, which financed a significant degree of consumer spending during the boom. The amount of money owed on these loans is down 3% from a peak of $1.13 trillion in mid-2007, according to the latest Fed figures.
Much of that is the result of falling house values and tighter credit by lenders, but analysts say it also reflects decisions by Americans such as Bell to spend less and save more. The savings rate climbed to 5% in the three months that ended June 30, a 15-year high.
This save-more, spend-less trend has potentially significant implications for Southern California's real estate-centric economy, some analysts think. They believe that the nascent age of frugality -- if it has staying power -- could forge a new sort of California homeowner, one who ranks energy-efficient appliances and access to public transit ahead of granite countertops and luxurious bathrooms.
Economist Edward Leamer, director of the UCLA Anderson Forecast, believes that wholesale shifts in Southern California's suburban land-use patterns may emerge, so that Los Angeles begins to look a little less like a giant cul-de-sac and a little more like Manhattan.
During the housing boom, homeowners had no qualms about spending money to commute to distant suburbs carved out of the hinterlands. But frugal home buyers, he said, will be more inclined to look first at homes that are closer to their jobs.
"We're going to see more multifamily-dwelling units," Leamer said.
The real estate industry is known for its bigger-is-better attitude, but even some industry pros sense a change.
"We'll probably be seeing a trend toward smaller, greener, less-costly-to-maintain houses," said Walter Maloney, spokesman for the National Assn. of Realtors. It's "a return to basics."
Not everyone is buying it. Eventually, when the economy regains steam and housing prices rebound, Southern Californians will again stretch to buy a house they cannot really afford, some believe.
"People have short memories and just look a couple years ahead," said San Fernando Valley real estate agent Gary Rapoport, who represents clients generally looking for properties in the $400,000 range. "They just want to buy whether they qualify or not."
Real estate economist Christopher Thornberg seconds that view. Californians display a sort of amnesia about downturns that affect the housing market, he said, whether caused by financial-market debacles or the collapse of the technology boom. Price slumps in each of the last four decades, he noted, didn't dispel the perception of residential real estate as a sure-bet investment.
"We've been here before," Thornberg said. "People have a shocking ability to forget the past."
The counter-view is that the great recession will have a long-lasting effect on those who lived through it, much in the way the Great Depression scarred its survivors. That economic nightmare was credited with spawning a generation of Americans who mended torn clothing, saved rubber bands and dutifully returned soda bottles for deposits.
"Because of the mess we just came out of, people will be more wary, more cautious, about believing [home] values can go back up to where they did, and not be as aggressive consumers as they were before," said Lori Gay, president of Los Angeles Neighborhood Housing Services, a nonprofit lender and developer.
"We do need to have some personal responsibility," she added. "The bulk of consumers had some slight greed on the table too."
Matt Rodriguez, a 30-year-old parade-float builder, may exemplify the new, cautious Californian.
Although he and his wife, a community college teacher, together earn well more than $100,000 annually, the tanking real estate market persuaded them to put an indefinite hold on buying a starter home in the San Gabriel Valley.
Friends' horror stories -- in this instance, the tale of a contractor buddy whose fixer-upper is now $250,000 underwater -- further darkened Rodriguez's long-term perspective.
"We've scrambled. We've refigured," Rodriguez said. "It makes no sense to own now. We're moving on."