From the title, you would think this post is about the pictured kitty. Rather, he is launchpad for a discourse about San Diego real estate. Let’s start with Goldie, whom I profiled as part of my “Cats of University Heights” series in September 2017. The Featured Image is the last portrait I made of him, using Leica Q2, on June 26, 2021. Vitals, aperture manually set: f/5.6, ISO 100, 1/250 sec, 28mm; 5:26 p.m. PDT.
I continued to see Goldie inside his yard for several more weeks, and I initially thought nothing about there being, as late as early August, no visible activity at the house whatsoever. The place was fairly quiet before the SARS-CoV-2 (severe acute respiratory syndrome Coronavirus 2)/COVID-19 lockdowns brought many parents home and kept kids out of school. My wife and I delighted seeing the youngsters playing outside the home. Then they disappeared, which I attributed to the local, year-round public elementary school reopening.
Fast-forward to the morning of August 17 (Tuesday), when I observed two men leaving a staging company’s truck and entering the house. On the 22nd (Sunday) someone posted Open House signs around the neighborhood and in front of the property: From 1 p.m. to 3 p.m. But as I walked about around Noon, the signs had vanished. There was no showing. Then yesterday, a For Sale sign appeared outside the home. This afternoon, the listing went live for $1.4 million. For perspective—and brace yourself—the place last sold on Nov. 2, 2011 for $370,000.
Yep, In 10 years, the value appreciated by more than a million bucks. How is that possible? Two reasons, I see. Firstly, San Diego home selling prices are way up. According to Redfin, the median is $790,000—a 17 percent year-over-year increase; data is for July 2021. Wow, people are willing to pay. According to Zillow, during second quarter of this year, 31 houses sold for a half-million or more above asking price. Demand is insane, when bidding wars are like this or worse: another six sold for $1 million or more above list. Yikes.
Secondly, the owners filled the large lot with a second domicile and two garages. The original, 1914-built Craftsman now comes with an additional building, with two-bedroom residence, that I have watched being constructed during many months. That activity is likely another reason for the children playing in the front yard during the pandemic—construction in the back.
That’s how you go from buying a property for $370,000 in 2011 and asking $1.4 million in 2021. These backyard conversions are everywhere in University Heights—and, presumably, other neighborhoods. Two are being built right now across the street from me. Large lots that previous generations viewed as valuable living space for families are being filled with new structures—often as rentals.
Regarding those backyard builds nearby my apartment: A year ago, two couples paid $720,000 for an 816-square-foot bungalow they planned to share until constructing the second house behind. Two doors down, the other, a 660-square-foot cottage, sold for $535,000 in April 2019. The place required complete renovation, and sisters share the smaller building until the additional one is complete. Somebody’s getting a new house for Christmas, if not sooner.
Goldie is gone, and I hope his family will be happier, and perhaps wealthier, from their investment. Cash out while you can, because another housing bubble is here—and it looks lots like the one I warned you about 16 years ago this month. Expect another analysis and forewarning from me in the near future.
Update, Oct. 14, 2021: The house sold for asking price, six days ago.