Real estate's dividing line.

THE house just up the street went on the market the other day for $1.5 million, and no, we don't live in Malibu or Brentwood. Everybody has their own story about housing prices these days, but for me, that astounding listing for a not-so-astounding property (cheapish window treatments, small kitchen, less than 100 yards from major-league traffic) pretty much sums up the real estate market these days.

For more quantifiable evidence, there are the April numbers from DataQuick, which show that the median-priced home in Los Angeles County was $387,000, up 27.7 percent from a year earlier. And as any house hunter will tell you after a weekend of open houses, $387,000 doesn't get you what it used to.

While prices keep soaring--no doubt fueled by the prospect of higher interest rates--actual sales fell 5.8 percent for the month. Sales have been flat or down for some months now, in fact, which suggests that inventory is especially fight. When that happens, prices have nowhere to go but up.

For folks desperate to be homeowners, the only alternatives are outlying regions or those "less desirable" neighborhoods in the middle of town. "You can't touch a bungalow in this neighborhood anymore for under $400,000," said a Long Beach city official in our story this week on a portion of ZIP code 90813, one of the poorest communities in Los Angeles County, based on a Business Journal analysis.

When people invest that much money in a house, there's a good chance they'll spend a bit more tending to it. Which, in turn, attracts other homebuyers who will do the same thing, and the next thing you know what had been a struggling neighborhood turns into a more prosperous one.

But not so fast. As home prices soar, wages are barely creeping up, certainly not enough to keep pace. Thus, only 23 percent of the households in Los Angeles County could afford to purchase a house in March, down from 31 percent a year earlier. Statewide, according to the California Association of Realtors, the minimum household income to purchase a median-priced home of $428,280 was $97,340, based on a standard 30-year fixed-rate mortgage at 5.48 percent and a 20 percent down payment.

That, of course, eliminates an awful lot of people--certainly most of the folks living in the 90813 ZIP code. The government does provide occasional support for lower-income families looking to buy, but short of outfight subsidization, homeownership is another world for the vast majority of L.A. County residents.

A cooling-down is probably in the offing, what with rates starting to edge up. Anecdotally, agents report that listed properties are not being snapped up quite as fast as they had been in the spring. But so what if there's a slight dip and that property down the street sells for $1.3 million instead of $1.5 million?

By coincidence, this happens to be the week we take our annual look at L.A.'s richest people, accompanied by an analysis of the area's wealthiest ZIP codes, and while the numbers will probably dazzle and amaze, it's yet another reminder that we live in a region deeply split between rich and poor. And the opportunity for upward mobility through entrepreneurship or job skills--so much a part of the Southern California story after World War II--is pretty much by the boards. There are still stories of people who have edged into the middle class, and sometimes well beyond, but this economy is not very charitable to those lacking advanced education, experience and a bit of luck.

Unless you happen to own a house.