America’s Most Overpriced ZIP Codes – Forbes.com
America’s Most Overpriced ZIP Codes
Matt Woolsey, 07.29.08, 4:00 PM ET
In San Jose, Calif., home to Silicon Valley and some of the highest home values in the country, a bumper sticker reads, “Dear God, one more bubble before I die.”
Chances are the car’s driver lives in Willow Glen, a neighborhood with a small-town feel, Spanish-style single family homes and a main street with sidewalk cafes and locally owned shops. To live there, residents are paying the city’s highest prices relative to what they could pay to rent similar properties in the same area. When you compare mortgage payments to the value of a similar home on the rental market, the price to buy is 26.1 times higher, one of the biggest differences in the country.
Willow Glen is one example of a neighborhood where homeowners are still taking chances on future appreciation–and paying a premium above and beyond their neighbors for that confidence.
But expensive does not mean always mean overpriced.
Limestone townhouses on the Upper East Side of Manhattan, for example, are listed for ever-dizzying prices. Financier J. Christopher Flowers bought a $53 million townhouse on East 75th Street in 2006, and sold a smaller East 73rd Street townhouse undergoing renovation for $23 million in 2007. Expensive? Yes. Overpriced? Not so much. Consider that a five-bedroom mansion on East 74th Street that once belonged to Eleanor Roosevelt is currently listed for $60,000 a month. Prices may be tops in the city, but prime rental prices are peerless as well.
Instead, the country’s most overpriced areas are ZIP codes like San Francisco’s Outer Sunset neighborhood, 94122, which, given its location near the Pacific Ocean and on the south side of Golden Gate Park, was during the most recent boom widely thought to be up-and-coming. Median prices surged from $560,000 in June of 2003 to a peak of $771,000 in March of 2008, based on Trulia.com price data drawn from California’s multiple-listing service.
Still, it’s not as overpriced as New York’s TriBeCa (10013) or Boston’s Chinatown (02111), where demand for high-end condos, new development and proximity to downtowns have pumped up prices.
Goddamnit. New York beats us again. Heck even Boston’s 1 block of Chinatown beats us. Why can’t we ever win? Why can’t we have the most overpriced Zip Codes?
What can we do as community to win? Let’s think out of the box people!
Thanks to Burbed reader Michelle, Mia, and many more for this find.