As much as I hate to zero in on a specific neighborhood, I do in fact believe that in this case it is warranted, although I believe that there are others in areas like San Elijo Hills etc. that also fit the profile. This entire neighborhood sold during the big run up in prices from 2003-2006, with most homes having sold in 2004 and 2005. They started in the mid to high 400s, and ended up in the 700s by 2005. The early phases saw rampant speculation by people who could not afford to live there and should not have been approved to buy those homes – even at 500k. Specifically, a number of homes in phase one went to people who worked for the builder, Centex. Another 3-4 homes went to one realtor who proceeded to live in one, flip it, live in another, flip it. In the first 2-3 phases, I would estimate that close to 30% of the buyers were brokers, many of whom flipped, or are still there and now in trouble. Most buyers spent 30-100k on yards they could not afford – just look at the landscaping as you drive up Edgewater. In the later phases, people paid 600-800k for homes that I seriously doubt they can afford either, especially with ARMS expiring etc. Sure, many can afford them, but many can’t – and it doesn’t take many to bring prices down. When you take all of this into account, you quickly develop a picture of a situation that is very unique to new neighborhoods that sold in the 2003-2006 time frame like Silvercrest. IMO, this is a very nice neighborhood, but needs more time to let ‘natural selection’ work itself out. Surely we will see lower prices, and people who can afford to live there will move in over time – but it will take considerable time IMO and we are not…
