Home Buying in 94107>Question Details

Heather Fern…, Home Owner in San Francisco, CA

Should I worry about the stability of property values on the south side of Potrero Hill?

Asked by Heather Fernandez, San Francisco, CA Fri Jun 1, 2007

I've heard the north side will retain their values given the views of SF and increased gentrification. Thoughts on buying on the south side?

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As a Potrero hill resident for 8 years, it does seem annecdotally that the entire area is now starting to hop (north and south side). Historically, the south side has had less demand, but several things are changing which I imagine might overtime tend to help the south side hold its value more:

1) UCSF and mission Bay. A huge new campus that is bringing many more people to the area. Students and professionals alike will look for places to live near work.

2) The 3rd Ave light rail is now in. Once again, more things converting to residential where there were previously shipyards.

3) Whole foods will open (on the North side) this fall I believe. This store may serve as an anchor tenant to pull in other retailers. Long term impact or more retail means more people wanting to live on Potrero hill.

The biggest gotcha on the south side are the projects. This said, not all South side streets line up next to the projects (there are several south side locations in fact that are preferable to North side with respect to project proximity).

Bottom line, my layperson's opinion: if you can find a home you like on the South side and it' s not too close to the projects- it indeed may hold its value well (and if you like the home- who cares about the ups and downs in value ).
1 vote Thank Flag Link Wed Sep 12, 2007
Hmm, it's been up and coming for several years. A good 5 that I know of. Take a look in the area. Not soon enough I think.
1 vote Thank Flag Link Fri Jun 1, 2007
As a long time Realtor and property owner in San Francisco the question isnt so much about retention of values as it is to understand what the value is about the property you are interested in. Lots of example are out there about properties in both districts being worth less now than years ago. Indeed our tech guru just gave us a presentation today that prices city wide are equal to what they were in 2004-05. The answer to you question is ... it depends on what you really want to buy, where you want to live and getting in at the right price.
0 votes Thank Flag Link Wed Jan 19, 2011
Excellent "specific" answers below.... a broader answer... if you buy in a slower market (now), in the less desirable part of town (south side instead of north side) you will have an easier time finding a "deal". Then, when the market heats up again, and Buyers can't cherry pick only the best properties in only the best locations (as they are doing now), you will see your south side prices rise proportionately higher.

A simplistic scenario.... let's say a home is now worth $1 million on the North side... but you find the same home on the South side and negotiate a $850k purchase price (you have no negotiation power on the north side because there are too many Buyers willing to pay the price - but you have tons of neogtiation power on the south side because you have little competition). Later, the market is up 10% so the North sider sells for $1.1 million, but with Buyers swarming all over, they spread out to the South Side and think the same house for $1 million is a steal. In this scenario you get a 17.5% gain vs. a 10% gain.

In hot markets buyers spread out... the hotter the market, the further out they go. As the market slows, everything contracts again. The best properties in the best locations maintain their value the most ... (as your question implies), but you can "buy" your future appreciation in a slower market if you are a saavy buyer.
Web Reference: http://www.SFisHome.com
0 votes Thank Flag Link Tue May 13, 2008
I think the South Side of Potrero Hill future is only up. In my mind, the biggest and most dominating negative are the public housing projects to the south.

However, there are many plans for the area around the south side of Potrero Hill that should have a good influence on the area including:

1) obviously Mission Bay redevelopment which creeps all the way down to Maricopa St

2) The 3rd Street light rail

3) The new Espirit Park condo development on Minnesota and 20th in the Dogpatch (http://www.sfnewdevelopments.com/3466/esprit-park-update-2/)

4) The Pier 70 redevelopment efforts in the Central Waterfront (http://www.sfgov.org/site/port_page.asp?id=34925) which should help make better use of the 65 acres of waterfront property.

5) The Eastern Neighborhoods Community Planning efforts which could impact the Potrero Hill and Central Waterfront neighborhoods. It will impact the south side less so other than to keep it residential with the exception of a new Employment and Business Development District (EBDD) area near the projects on the south side. Additionally, there is a proposed "Life Sciences Zoning Overlay" just south of Mission Bay in the Central Waterfront which presumably would encourage the development of a "knowledge industry" in this area - startups, supporting facilities for Mission Bay life sciences research, etc. http://www.sfgov.org/site/planning_index.asp?id=25205

6) The increased redevelopment and commercial activity around the new "The Potrero" condo development including the new Whole Foods as well as Sega relocating their corporate headquarters across the street in the Culinary Institute building.

7) the constant discussion over either rebuilding or relocating the public housing projects on the very south side of Potrero Hill.

Hope this helps
Mark
0 votes Thank Flag Link Wed Oct 31, 2007
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