Which will be the next area to gentrify?
“No kitchen, no bath and the rear portion of the structure is falling off.” [Burbed.com]
WillowGlenner Says:
July 23rd, 2008 at 9:49 amlisa paul, you are my kind of real estate buyer. I suspect when you bought in Noe, it was not the “in destination” for RE. People don’t realize how much the neighborhoods in the bay area have changed over the years. I can’t really think of any good neighborhoods that went bad, but I can think of dozens of marginal areas that turned into high end zipcodes over time. This is not to say you have to buy low and sell high to make money in RE. You can buy high and sell higher also. But many low end locations turn around- its just a waiting game.
So, which will be the next area to gentrify? Will it be East Palo Alto? Will it be Redwood City? Will it be South San Francisco? Who will enter the Real Bay Area next?
What are you guesses and why?
August 2nd, 2008 at 6:40 am
EPA is next. Its location midway between SF and Silicon Valley, and its proximity to Palo Alto make it too valuable not to. As soon as they clean up the drug and violence issues, RE prices will skyrocket there.
August 2nd, 2008 at 7:20 am
East Palo Alto no doubt. Reason: Powerful and influential Burbed blog.
Bwa HA HA
August 2nd, 2008 at 8:06 am
With the real estate downturn in full swing, the real question is which areas will un-gentrify first? SOMA? The Mission?
August 2nd, 2008 at 8:45 am
EPA has name cachet, plus of course the awesome power of IKEA, but RWC is much less farther down the rathole, drug and gang-wise.
South SF has too much industry and airport proximity to join the RBA.
August 2nd, 2008 at 8:56 am
I say downtown San Jose, the area around Japantown etc.
August 2nd, 2008 at 10:02 am
People have been talking about EPA gentrifying for years, hasnt happened yet. It had that great location back then too. The attractiveness of a suburban area is determined mostly by families, and only the bravest of families will move into EPA. EPA’s sole attribute is its proximity to jobs, it doesnt have any interesting architecture, nor history.
Urban areas are easier to gentrify because young hipsters can move in. They tend to see the seedy elements of their new environment as giving it a sort of cachet - as hipsters like to feel like they are “in the real world”.
Downtown SJ could work, but SJ will also be the poor sister of SF when it comes to coolness. And coolness is key to an urban renewal.
If you are looking for a suburban place to go upscale, its more of a gradual move - not warzone to luxury Its more like so so to pretty damn nice.
August 2nd, 2008 at 10:13 am
I live in San Carlos now, and I think while boring, its pretty damn nice. My understanding is that 25 years ago, it was perceived as much less attractive vs. today.
Is this true? If so , how did it occur? It might be blueprint for suburban communities moving up.
I am sure someone will cite “schools”, but to me the pereived quality of the schools is driven by the quality of student who can score high on API tests. So good schools follow upper end families. In other words teh schools “goodness” is really the students skills.
August 2nd, 2008 at 10:20 am
I don’t think we’ll find out until home prices are done plummeting and interest rates come up to 20%. I can’t think of anywhere in the BA that didn’t gentrify like crazy in the past few years.
August 2nd, 2008 at 11:01 am
Ironically, San Carlos actually eliminated their high school. They also eliminated school buses.
August 2nd, 2008 at 11:43 am
I think if San Carlos had its own HS, the values would be even higher.
Right now, most of San Carlos gets Sequoia, which is rough. THere is talk that Sequoia improving, but with much of its population coming from RWC, its never going to be an elite high school.
A small portion of San Carlos is assigned to Carlmont which has a sizable EPA via busing population.
August 2nd, 2008 at 12:01 pm
“I live in San Carlos now, and I think while boring, its pretty damn nice. My understanding is that 25 years ago, it was perceived as much less attractive vs. today.”
Is this true? If so , how did it occur? It might be blueprint for suburban communities moving up.
I didn’t live on the peninsula then, but I think 25 yrs ago San Carlos was more industrial, with more blue collar workers and the downtown was pretty dead. Also the houses were small, but cared for.
About 10 years ago that started to change and more middle/upper middle class people discovered it and started moving in. It is sandwiched between Edgewood Park in Redwood City and Belmont so there is little spill over crime from neighboring cities and I would guess there were low crime rates in the city to begin with. I think low crime and good schools are a prerequisite for catapulting a city into the upper end realm quickly as occurred in San Carlos.
According to the latest CNN Money rankings, San Carlos ranks #24 under the combination categories of “Best Places to Live” and “Pricey Homes”.
I don’t think it could be used as a blue print because there was not much wrong with it (unless you consider lower middle class people and a boring downtown bad) to begin with thus the easy transition. There is also alot of remodeling/tearing down going on as the houses were small to begin with.
I don’t think that EPA will ever have the ability to gentrify as it would have to undergo too big a change. Don’t the people who currently live there either have to move out or want to become gentrified? None of my friends would want to live there and risk their lives/property while waiting for it to change. I want to be able to go outside and water my postage stamp sized lawn without getting caught in the cross fire.
Burbed is correct. The high school was demolished to make room for a large park and homes. When most of the busing from other cities stopped coming into San Carlos, the scores at Carlmont went up and it is now seen as a desirable high school. I think there are still kids from other cities who are allowed to attend Heather elementary school thus it still suffers from low api scores. It doesn’t mean it is not a good school, but as Baggins says “the pereived quality of the schools is driven by the quality of student who can score high on API tests.” Kids from low income families often don’t have the same opportunities in their first years before they go to school as do kids with higher earning parents thus they don’t score as high on API tests.
If an area on the peninsula hasn’t already gentrified during a time of easy money and speculation it probably isn’t going to happen anytime soon.
August 2nd, 2008 at 12:26 pm
Stepford
You are right, places like San Carlos havent “gentrified”, but rather just moved upscale, from blue collar to white collar.
I think we should talk about two types of moving up
1) urban gentrification
2) suburban ladder climbing - eg San Carlos blue collar to white collar
EPA is stillhas terrible crime and schools. It has nothing to attract the typical gentrifiers - hipsters and gays. No families will take the risk there. I think 25 years from now people will still be saying “EPA has a great location, its going move on up”
As for places that can move up, how about the nicer parts of RWC spreading a bit east and south? Right now, the nicest part of RWC is the Mt Carmel area near Alameda and Whipple/Edgewood road. Can it spread?
August 2nd, 2008 at 12:43 pm
I know you would like to think that EPA has not improved, but crime there as high as it is now, is much lower than what it used to be. It used to be the murder capital of the US back in 1992.
I don’t know if will continue improving though.
August 2nd, 2008 at 1:13 pm
Cardinal is right. EPA has improved, but not enough for me to feel safe there. Think about how many years it took just to get where it is now. I wouldn’t think it would be worth the effort to try to collect rent from there.
As to RWC, Mt Carmel has very charming homes. Redwood City suffers from the low API score syndrome which lowers the real estate values. I am not sure about the nice part spreading outward. Aren’t there a lot of apartments surrounding that area? It might be the other way around and the bad area could start encroaching on the nice area. I guess it could go either way.
August 2nd, 2008 at 1:45 pm
It is generally true for West Bay (and East Bay) that prices and class of people change from mountain to sea. Somehow closeness to sea is not desirable. Foster city and Redwood shares are the only exception because they are new development from landfill. Same goes for a few successful East Bay developments.
You need to kick out the old folks to build new communities for new wealth to come in. For San Carlos the area close to 101 and beyond are blue collar areas, unless it changed in the last 10 years. I doubt it become white collar, maybe it just become so expensive that white collar has to move in and mix with blue collar.
So forget about old dumps.
August 2nd, 2008 at 2:13 pm
that downtown san carlos area pretty much didn’t exist before 1990. Before somebody says the structures are not new, thats true. But it was not a “hip downtown” kind of place. There was a woolworth with a diner in there (remember those?), an independent grocery store, a bank and a post office. That was IT. I was renting in the area when they built the downtown. That added immensely to the area. At the same time, Oracle corp was booming- that brought all this wealth to the town whereas before that, Silicon Valley was mostly in the south bay. El Camino and the train station in San Carlos started to clean up.
As to san jose, I agree it will always be a step sister to SF, but that won’t keep it from gentrifying.
August 2nd, 2008 at 2:34 pm
Rick - You’re probably right that the area East of El Camino near 101 has not converted to white collar. That area is a pretty small section, but I could be wrong as I have only driven down industrial and never through the neighborhood. If you look on the current mls there are about 6 houses in that area which list from 569k - 680k so those would fall into the lower end price range.
I have read that the houses on Holly could be torn down and turned into mixed use retail/residential. Palo Alto Medical is building a hospital there and and the road will need to expand as it is a main artery. It would be interesting to buy on Holly only to be forced to move in a few years. I wonder if that would be a good or bad investment. The other option is to take some of the front yard to build the road wider.
August 2nd, 2008 at 2:41 pm
WG - The independent grocery store (I’m thinking you mean Foodville) is moving to the old Bell market site (remember that dumpy store?) and will be converting to Bianchinis (sp?) like the one in Portola Valley. I have only known the downtown in its more recent years so your comments about its history are interesting.
August 2nd, 2008 at 2:50 pm
I meant to say PAMF will be building near Holly not on Holly. The center will be on Industrial rd. There could be a new hotel in that area which would also put pressure on Holly St to expand.
August 2nd, 2008 at 3:26 pm
Madhaus,
Do you still want to argue that Sunnyvale Town Center is not moving ahead with construction? Have you driven by there lately?
I say that part of Sunnyvale is a good candidate for further gentrification. Once the project is complete, there’ll be plenty of hip factor.
August 2nd, 2008 at 3:34 pm
I have seen a few families pool their money and buy in to EPA to create their own walled compounds. Buy a big lot and build 2 to 3 houses on it. Central courtyard for the kids to play in. The kids are home schooled or are on scholarship at a private school.
August 2nd, 2008 at 3:41 pm
As to RWC, Mt Carmel has very charming homes. Redwood City suffers from the low API score syndrome which lowers the real estate values. I am not sure about the nice part spreading outward. Aren’t there a lot of apartments surrounding that area? It might be the other way around and the bad area could start encroaching on the nice area. I guess it could go either way.
In RWC 94063, the highest property values are in the letter streets bordering San Carlos. Otherwise they’re all about the same, except for the occasional, rare cul de sac (usually because of the inactive train tracks) or an exceptionally poor area like Marlborough.
August 2nd, 2008 at 3:45 pm
Really? That is fascinating - I have never heard of such a thing as buying and building a compound in EPA. Can one drive by and view these compounds? Are the lots in EPA big enough to build 3 houses? More info please.
August 2nd, 2008 at 4:46 pm
I suppose something like this: http://maps.google.com/?ie=UTF8&ll=37.47204,-122.130868&spn=0.0047,0.011373&t=h&z=17&layer=c&cbll=37.470097,-122.131294&panoid=o7IAxzjin2HkeYuOzhIPVA&cbp=1,180.46811541237548,,0,4.664382861089232
There are several areas, but I wouldn’t call it a compound because it is not gated off.
August 2nd, 2008 at 5:02 pm
Those look more like multiple houses built by a single developer.
I am still intrigued by the family(s) Rocket knows of thinking it is worthwhile to pool their money and build a private compound in EPA.
August 2nd, 2008 at 5:12 pm
Maybe you’re right, I don’t know if what Rocket says is doable, the houses with really large lots are being sold for 1.1-1.3M, but these lots are almost an acre in many cases, so I’m not sure how much that is worth.
Either way I think they should gate the area off, there are several areas that could be like what Rocket says, but I’m not sure, how would one do that, would they hire an architect? Apply for permits, test the soil, build foundations to try to meet earthquake standards, and build? What would it cost to build?
August 2nd, 2008 at 5:51 pm
The Green Zone, EPA
August 2nd, 2008 at 5:59 pm
Madhaus,
Do you still want to argue that Sunnyvale Town Center is not moving ahead with construction? Have you driven by there lately?
I say that part of Sunnyvale is a good candidate for further gentrification. Once the project is complete, there’ll be plenty of hip factor.
I’m afraid that the last time I was downtown was in mid-May, so no idea what’s happened in the last couple of months. If you’ve seen some improvements, please describe them.
My weekly glimpses of downtown span November 2003 to when the music store closed. Then I’d pop in occasionally. I wonder if Craig (the drum teacher) is still giving lessons in the empty Haight-Ashbury building. It really breaks my heart how many businesses decamped early because of the “scheduled” construction, in particular Sushi Maru. The place was still standing but empty this May.
August 2nd, 2008 at 6:39 pm
I’ll try for the area north of downtown San Jose maybe, downtown San Jose should become more like a downtown, the new condos all over the place might help, but they probably should do something to attract restaurants, and other shops.
Then in the future the VTA can magically come up with $6B and build BART. Then the high speed rail gets built, and a station will be put in at Diridon. Then a new people mover will be built from the BART/Caltrain in Santa Clara to the airport with some more VTA magic money. And SJC gets more long-haul flights to Asia, and the East Coast. Then they will all tell about how cool SJ is and how they should’ve discover it earlier.
August 2nd, 2008 at 7:52 pm
More good news for the BA from Chase —
Chase has made a business decision to suspend our Non-Agency Fixed and ARM (Amortizing and Interest-Only) Product offerings within the Wholesale Lending Business.
We have made this decision based on a variety of reasons including the following:
· A dramatic reduction in Jumbo volume levels over the past six months
· A lack of Capital Markets appetite for Jumbo products
· Worse than expected delinquency performance on these loans
Hmmm. I thought only those low-end subprimers were going delinquent.
August 2nd, 2008 at 8:24 pm
The typical next areas to gentrify are blighted but pedestrian-oriented urban neighborhoods close to a downtown that is about to reshape itself. I have my doubts about downtown San Jose despite the condo projects, but would love to be proved wrong.
I find another type of neighborhood to be equally interesting: the ones with a rapidly aging population, low turnover, built around an elementary school, in suburban cities committed to urbanizing their downtown. That’s where you can see predictable, slow but steady improvement and few or no teenagers, drugs, crime. Then it should only be a matter of a few years’ wait to see the influx of young professional families moving in and revitalizing and improving the neighborhood. To be utterly cynical, I even wonder if one could compute a ‘death wave’ based on the typical original buyer’s age at the time the neighborhood was developed, and time the investment accordingly.
August 2nd, 2008 at 9:42 pm
>>I’m afraid that the last time I was downtown was in mid-May, so no idea what’s happened in the last couple of months.
Are you serious? It’s only like 10 minutes from your house!
There are all kinds of multi-story steel structures being put up within just the past month. Some major construction is going on there.
August 2nd, 2008 at 9:51 pm
Are you serious? It’s only like 10 minutes from your house!
There are all kinds of multi-story steel structures being put up within just the past month. Some major construction is going on there.
I don’t have any reason to ever head in that direction these days. Sunnyvale Community Center, yes, but not downtown.
So the major construction is only 8 years coming.
August 3rd, 2008 at 12:11 am
> Are you serious? It’s only like 10 minutes from your house!
Real Estater, if you’re in 94301 you’re probably 10 minutes from EPA. Do you go there often?
August 3rd, 2008 at 12:43 am
BTW, I know someone who bought one of the homes in the map linked by ‘cardinal2007′ in post #24 above. They paid close to $900K about 2 years ago and were looking to sell recently to move back to their home country to take care of an aging relative with health issues. They were unable to find buyers who would offer more than $600K.
August 3rd, 2008 at 1:20 am
“Name” - I’ve seen rentals in that area. They ran about $2500/month a couple of months ago. Too bad; that certainly wouldn’t make them cash-flow positive.
August 3rd, 2008 at 6:49 am
Yes, it has to be done with permits. The one group I know personally that did it designed their own houses and built it themselves.
Here are some places on Euclid Avenue in EPA:
http://maps.google.com/maps?f=q&hl=en&geocode=&q=Euclid+Ave+%4037.466724,+-122.143207&ie=UTF8&ll=37.466724,-122.143207&spn=0.002022,0.004131&t=h&z=19
Here is a candidate in EPA for a two house compound:
http://www.redfin.com/CA/East-Palo-Alto/2216-EUCLID-Ave-94303/home/1892607
August 3rd, 2008 at 10:32 am
I know some people in EPA who bought a few blocks from IKEA. No kids, so no worries about the school issue. Other than a postage-stamp-sized lot the place is nice. I’ve never felt worried for myself or my car when visiting there but I also haven’t gone exploring much beyond the route back to the highway.
I would not buy in EPA, but more because it has no downtown and no local shops; I like old-line suburbs with a walkable downtown.
August 3rd, 2008 at 11:13 am
I would not buy in EPA, but more because it has no downtown and no local shops; I like old-line suburbs with a walkable downtown.
It’s only a matter of time before someone buys out that burned-out strip mall on Donohoe and tries to make it something..
August 3rd, 2008 at 12:23 pm
> It’s only a matter of time before someone buys out that burned-out strip mall on Donohoe and tries to make it something..
And when it is done, it will only be a matter of time before it is burned down again
August 3rd, 2008 at 4:20 pm
I agree that EPA is safer, still dangerous but much better. PA would love to gentrify EPA, kick all the poor people out and build mansions. I’ve been to the “compounds” as well - where they claim to want to help EPA improve but then send their kids to private schools and hire their own security force. not that I blame them, just prefer they don’t pretend otherwise. If you have the time and energy, and your kids are a minority, you can still get scholarships for pricey schools who need minority scholarship kids.
There is a population who still remembers how EPA used to be (before the crime) and want to make it a safe but affordable place for the people who live there. I hope that happens before gentrification.
August 4th, 2008 at 1:41 pm
Gentrification will continue to take place in areas converted from commercial and industrial to residential, e.g. north San Jose, the 101 corridor through east San Jose. The flea market and fairgrounds will both fall to condos. This process has the advantage of avoiding the need to displace existing populations. The difficulties that will be encountered are already evident in the Rivermark area: lack of adequate retail and public spaces (parks, schools, libraries, community centers). San Jose is trying to convince developers of new commercial mid-rises to include retail, but the developers don’t seem inclined to play along. I could understand how it might be difficult to land a high-profile venture-backed Internet startup as a tenant when you have a Wal-Mart on the ground floor.
Treasure Island is a prime candidate for gentrification; it has the potential to be another West Seattle. But the anti-development camps have managed to keep anything from happening for over a decade. So it remains a mix of public housing and decaying Navy-era structures. I feel sorry for the people who have to live there, because there is not a single retail establishment on the entire island, not even an over-priced mini-mart.
August 4th, 2008 at 11:22 pm
I think there’s hope for EPA, actually… I dunno about the hipsters, but the earnest are certainly on their way in. I’ve met at least two couples who lived there.
August 4th, 2008 at 11:23 pm
Sorry, should’ve clarified that: white-collar couples w/ high earning potential, who chose to live in EPA for the big yard.
August 29th, 2008 at 3:59 pm
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