A wood-frame home in San Francisco with zero bedrooms, one bathroom and a 1940s-style kitchen – “the worst house on the best block” – just sold for about $2 million. A “not habitable” historic home in San Jose went into contract with an asking price close to $5 million. San Jose’s art deco Burbank Theater, which turned to adult fare before sitting vacant for two years, fetched $1.6 million – eight times the minimum auction price.
Welcome to the Bay Area housing market, where it seems that nothing – not a pandemic, not growing safety concerns, nor soaring construction costs – can arrest surging prices for even the most derelict of properties.
Take the Noe Valley home, built in 1900 and described in its listing as a “contractor’s special” with “extreme” deferred maintenance. It’s also “an opportunity like few others,” according to the marketing notes for 320 Day Street. It went up for auction in a conservatorship sale in mid-December and sold Jan. 7 for $600,00 above the starting bid.
The sales price was below the median single-family home price of $2.6 million in a sought-after southern neighborhood packed with Victorian homes, and many modern rebuilds, often with a view. Redfin says Noe Valley homes typically sell in 11 days; updated single-families with about 3,000 square feet routinely go for more than $4 million and can fetch over $6 million. The most expensive listing in the neighborhood—a modern, 6,000-square-foot view home on a lot double the size of the Day Street property—is $10 million.
Bidders were probably more impressed by the property’s almost 3,000-square-foot lot size than its boarded-up windows, mismatched flooring, and oversized square bathtub. Another plus: It’s zoned for two homes, although the entire city may soon fall under that designation.
Development potential was no doubt also part of the appeal in the sale of San Jose’s Graves House, named after one of the area’s early agricultural developers, an 1868 Italianate farmhouse that’s been neglected for years. Stalled plans to build an apartment complex on the site have left it “prone to chronic trespassing, vandalism, arson and accelerated deterioration,” according to the Preservation Action Council of San Jose, which put the property on its list of the city’s most threatened architectural and cultural landmarks of 2022.
The site, on two thirds of an acre in West San Jose just a block off Saratoga Avenue, has an entitlement to build 46 apartments, according to its listing notes. Listed for close to $4.8 million, it went into contract after 11 days on the market.
The Burbank Theatre, another of the council’s “Endangered 8,” sold at auction in two days last month. Built in 1949 as a double-feature movie house, showing arthouse and classic films, it transitioned into an adult film theater from the 1970s until the county shut it down as a public nuisance in 2000, according to the Mercury News. It was most recently home to a performing arts studio before falling into foreclosure, and has been vacant since 2019, a year after its marquee was added to the Santa Clara County Heritage Resource Inventory.
With any luck, the new owners will keep an arts focus and its signature Art Deco marquee for any eventual redevelopment, Ben Leech, executive director of the Preservation Action Council of San Jose, told San Jose Spotlight.
“San Jose has lost a number of historic theaters over the years,” Leech said. “When we lose these, we’re losing that ability for a place to be a community anchor and a landmark visual icon.”