A house in Silicon Valley that badly burned two years ago has been listed for sale at $800,000. Its market value has become the target of criticism online.
The 5,850-square-foot property in San Francisco's Bay Area is selling way higher than most undilapidated buildings in other states. Homes in Washington, New York, and Hawaii are selling at median prices that do not go as far as $460,000, according to FindTheHome.com.
The house realtor, Holly Barr, said the market value is not necessarily based on the integrity of the structure but the viability of the neighborhood. The house is located in Willow Glen Charm, a neighborhood south of San Jose, California, known for its annual Christmas lights, tree lines, and quaint atmosphere.
Willow Glen Charm is strategically located just a few minutes outside the largest tech hub in the country, Silicon Valley. It is also named the Best of Silicon Valley in 2013, Metro's reader poll where the most favored neighborhood wins.
Social Media Flak
Barr posted photos of the house on 1375 Bird Avenue on April 9 and has since gathered hundreds of comments from social media users. The realtor pitched the house as a place where the potential buyer could build his "dream home."
A Facebook user named Brian King said the house's current value is an example of "unchecked free market capitalism."
"Thousands of properties bought up like this with zero interest in actually living in that lot or renting or anything. The actual housing market shrinks as a result to the point where even Silicon Valley engineers are priced out," said King.
Another commenter, Victoria DaCunha-Ditton, expressed sadness on the current surge of housing prices in the area.
"That is crazy. I have lived in Willow Glen most of my life. Looks like I am probably going to have to move. I love it here but not for that price. It's sad that I can't even afford a burnt down house," DaCunha-Ditton said.
According to Barr, she is only doing her job to advertise the property until someone becomes interested in buying it. She added that every realtor is bound to initially sell at a higher price before negotiations take place.
She added that the would-be buyer will have a "great opportunity to build [their] dream home." Currently, 10 clients are looking into the property, and sale is expected to close in by the end of the week.
Supply And Demand
Rick Smith, a board member of the Santa Clara County Realtors Association, said in a TV interview that it is not surprising how and why the burned house is selling at $800,000. He explained that most properties in Willow Glen Charm and other immediate areas are flagged at a minimum of $1.5 million.
The average price of houses in the San Jose has reached a record of a 70-month high at $1.08 million. Zillow, a real estate company, estimates an increase of market values of up to 8.4 percent over 2018.
News reports in March indicate that more Californians are moving out of the state primarily due to the high cost of living. Taxes and housing take the bulk of the residents' expenses.