While I was researching my City Heights story today, I solicited your questions and insight on the housing market there.
Here’s a note I got from a reader who asked to remain anonymous:
I was recently in contract to buy a house in North Park for $700k, very nice vintage house, well kept. The appraisal came in at $600k. The amount of the discrepancy was so staggering that we thought the appraiser was inexperienced and overly conservative. We hired a second appraiser and the appraisal amount was not much different. We asked the sellers to lower the price but they refused so we walked away from the deal.
Conclusion: the proximity of the house was fairly close to City Heights and we think that values in North Park on the lower end are being affected by what’s going on in City Heights. The fear is that even “nicer” homes in North Park could get pulled down by a contagion effect in the neighboring market. I think of it as a reversion to the mean. Either the higher price house will have to go down in price to be closer to the low end, or the lower priced homes will have to appreciate significantly (the latter seems more likely).
What do you think? Send your thoughts, questions, comments or story ideas to kelly.bennett@voiceofsandiego.org.