This is KPBS Midday Edition. I'm Maureen Cavanaugh. Can be go home prices have been rising for years. The effects on lower income communities is pleasing some but whirring others. We hear how homeowners are reacting to the trends.When Tracy opens the gate you can see he's not kidding. The backyard has a vegetable garden, fruit trees and scores of flowers from roses.This is what we call butterfly alley. He has lived next door since late 60s and bought this property two decades ago.They would have these huge properties and they could sell them and go off into the world. My daughter said I'm doing perfectly well without your help. The semi retired fitness instructor put the -- it on the market. The deal move so quickly the listing will stay open had a cancel -- plan open houses. This demand will continue in the low income community.Will probably continue to lead the Seneca Metro.The real estate sites as home prices are projected to increase by nearly 4%. That's the second highest rate in the county.This house right here that just sold recently 600. PutA home owner said he scene is coming for years. He's been documenting home renovations on his Facebook page. He started to alert people the changes were coming.When I first started driving around and I first started the page there was a house here in a house there and now it is insane.He points out homes that are for sale or under renovation.That houses been redone, the house has been worked on in another house back there was featured on HGTV.He says he's pleased to see what he considers positive changes in a neighborhood that's been stigmatized as a crime area. He heard from other homeowners that agree but says summer commenting and criticizing the changes. And economist says he wonders how it will impact people in City Heights.The really interesting question is how are they adopting and what are the strategies? Are they sharing expenses? Are they considering moving away.He says he feels like he's contributing to the neighborhood by fixing up a home.The toilets would overflow in the overflow to the back because they did in the illegal toilet out there. The electric and the house was outdated so it was a fire hazard. There was so many problems you can begin. The house was cold because there was no insulation. The windows were updated.At the urban farm he says he will lock the gate connecting the two properties as soon as the cell closes. It may be difficult watching others care for the field that he's built.They will start a family here.What is him his wife first moved in they plan to start a family. An elderly couple rented them a place for $85 a month and eventually bought it.Joining me now with the more is Stephen Russell executive director of the San Diego housing Federation. Welcome to the program.Thank you.We heard that up to 70% are renters. Who owns these properties?Well, their landlords a lot of them are mom and pop apartment owners. Originally they were developed by mom-and-pop owners and there have been more investors coming in and buying them.It was a profile of the buyers who are now snapping up houses.They are largely different from the apartments that we just referenced. You see a lot of young families are being priced at a markets like North Park where they would -- were targeting. Prices are so crazy that just across the freeway It looks like a relative bargain.Are there investors in that market as well?There were especially during the recession. Very high concentration of investors who came in to flip homes and the ultimate recipient after it was priced up considerably would be young families who were looking for a place that they felt was within that price range.Are renters displacement properties in City Heights are sold?Yes, they are displaced very often especially for large families it's hard because apartments are one in two bedrooms.What other historically lower income areas is sending a county are seeing housing prices go up dramatically?City Heights is probably on people's minds because of the location. We are certainly seeing the Sherman Heights a lot of changes in just had the opportunity recently to visit the Golden Hill area. Even neighborhoods like in Claremont, you're seeing a neighborhood that's always been lower to middle class in your sing apartments are being turned over with some new cosmetic improvements in rented at a higher price.When they are displaced by the house is being sold in the right going up, where do they go?That is the key question. If they can they double up with friends or family members and that's often times a temporary living situation. Some people are moving out in different areas. We are seeing that especially true of the immigrant communities that traditionally saw City Heights as the first landing place. They're going farther places away from good job opportunities in goods and services.You can hear from the people interviewed in his report but -- that there are mixed feelings about the changes taking plates. What would you say is gained and what is lost when the committee changes like this?I can speak from personal experience I have a high -- house there and I live there. It was not a very safe place back then. It became much more better. You see those really positive changes that it safer but also you see these are different families. It was working-class Latinos that got enough money to buy a home but that doesn't exist anymore. So you see improvements in the shop friends in the public safety but the folks who were there richly may not be there to enjoy the benefits.It sounds like the housing Federation does keep an eye on areas where they are skyrocketing and renters are being displaced. What can the housing Federation do about it?We advocate for the increase supply of affordable housing. The average income in City Heights is in line with folks will qualify for affordable housing. Our goal is to see that we increase in the amount of housing that is built there that is stabilized. It's a subsidy that comes in. Families are not displaced and people can see the communities that they've lived in for many years.At been speaking with Stephen Russell, Executive Director of the San Diego housing Federation. Thank you.Thank you.
The backyard of Tracy King’s rental property in City Heights is what he calls an urban farm. The two-bedroom craftsman features a vegetable garden, fruit trees, a chicken coop and scores of flowers, from roses to milkweed. The latter helps form “butterfly alley,” where monarchs feed and breed before migrating south, he said.
King has rented the house out for two decades, partly as an investment for his children. He has lived in the home next door since the late ‘60s. Now, as the neighboring urban farm maintenance grows burdensome and his grown daughter said she is financially stable, he is selling.
He accepted a young couple’s offer that came at above asking price — and higher than the area’s median home value — the first day the property hit the market. The deal moved so quickly, the listing real estate broker had to cancel a planned open house.
“It’s retirement income,” King said. “All of a sudden you know, we have this money, pay off any debts we have, be debt free, and be able to travel, so it’s basically (an) end-of-life idea.”
The sale reflects a trend hitting the City Heights community. Home prices in the neighborhood are expected to appreciate at the second-highest rate in San Diego County over the next year, according to Zillow. The online real estate website predicts values in the 92105 zip code will increase 3.9 percent, a rate tied with Clairemont and second to the Imperial Beach region. Homes in that community are expected to appreciate 6.5 percent.
Zillow Senior Economist Aaron Terrazas said neighborhoods that have been plagued by high rates of poverty and low-performing schools, such as City Heights, are gaining popularity with buyers of higher means.
“This area has been appreciating quickly and will probably continue to lead the San Diego metro over the next year,” Terrazas said.
City Heights resident Paul Smith said he has watched the changes to the neighborhood over the last four years. He posts photos of home and building renovations to his Facebook page, Transforming City Heights.
“When I first started driving around and I first started the page, there was a house here and a house there,” he said. “And now, it’s insane.”
Smith, a trauma nurse who owns a home and rents out another in the community, said he cannot keep pace with the changes occurring, which he follows through real estate sites and neighborhood drives that sometimes help put his two young daughters to sleep.
“There’s just too many projects. There’s houses being done everywhere,” he said, noting he sees many are selling quickly and at high prices.
He said his first home, which he renovated and now leases out, cost him $295,000 four years ago. He bought a new house, which he is also fixing up, six months ago that he said cost $450,000. Now a pending sale for a similar house down the street is at $495,000, he said. The area’s median home value is $408,000, according to Zillow.
Smith said much of what he documents, including new business openings, neighborhood cleanups and beautification efforts, has garnered a positive reaction, especially from homeowners. Although, others have decried some of the changes as gentrification, when affluent populations move in and displace poorer residents.
But Smith said he feels he is contributing to the neighborhood because the home he fixed up — doing much of the work on his own, he said — was in bad shape.
“When we took out the main sewer line, which most of these houses down here have cast iron pipes, it was rotten in the ground,” he said. “I had back ups with the plumbing when I first bought the house within a few months. The toilets would overflow. That was a nice mess.”
Terrazas, the economist from Zillow, said he does wonder how the market is affecting the lower-income 92105 zip code, where the U.S. Census Bureau estimates more than 70 percent of residents are renters.
“How are they adapting? What are the strategies? Are they moving in or sharing expenses with family members? Are they considering moving away?” he said.
At the urban farm, King said he plans to lock the gate that joins his two properties as soon as the deal closes on his former rental unit. He said it may be difficult to watch the new homeowners care for the sanctuary he created in the backyard, but he is excited for their future.
“It’s almost like I’ve been preparing it for someone else to take it — and this is the buyer’s first home, and she and her husband are going to be starting a family here,” he said.
King said when he and his wife first moved into the home he lives in and owns next door, they also had plans to start a family. An elderly couple first rented them the place for $85 a month.
KPBS is following the changes in the City Heights community. How is the housing market affecting you? Contact Reporter Tarryn Mento at tmento@kpbs.org.
