What does it cost to buy a 3-5 bedroom house in an area with good schools in Silicon Valley?

School District MapIt’s a hot seller’s market in Silicon Valley, but it’s also a time of great job growth here!  Each week I get calls or emails from people considering job offers in Cupertino, Palo Alto, Mountain View, Sunnyvale, Menlo Park, San Jose and nearby.   Many of these recruits are interested in areas with superior public schools.

What’s the cost of buying a house of about 2,000 square feet with 3-5 bedrooms and great schools?  A few communities with better education are these: Los Gatos, Saratoga, Cupertino, Palo Alto.  We’ll consider these to provide a sense of prices in similar areas.

Here’s a quick looks:

  • Los Gatos: approximately $1,200,000 to $1,675,000 depending on the school district
  • Saratoga: approximately$1,500,000 to about $2,000,000 depending on the schools
  • Cupertino: approx $1,700,000 (some high schools will bring in higher prices and others lower)
  • Palo Alto: approx $2,700,000

If you are new to Santa Clara County, you may be wondering if this is correct. It is…

Please continue reading here:
How do prices compare between Los Gatos, Saratoga, Cupertino and Palo Alto?

San Jose Mercury News Headlines April 15 – 16 2014: home prices to buy or rent are rising steeply

Here are the headlines from the San Jose Mercury News in mid April 2014:

Home Prices to buy or rent going up April 15-16 2014

Rental article: Bay Area apartment rents set record 4/16/14

Excerpt:  Bay Area apartment rents are rising at nearly double-digit annual rates and have reached record levels, according to a report released Tuesday, prompting some analysts to warn that the region’s economic boom could be choked off by the relentless rise…..  Among the Bay Area’s three largest cities, San Jose had an average asking rent of $2,066 during this year’s January-March quarter, up 10.3 percent from the same period last year, RealFacts reported. Oakland had an average rental rate of $2,187, up 12.3 percent, while San Francisco posted an average of $3,057, up 9.5 percent.

Home buying article:   Bay Area home prices jump year over year

Excerpt:  March marked more than 20 consecutive months of year-over-year price gains for single-family homes in the East Bay, South Bay and Peninsula, according to real estate information service DataQuick, which released a report on March sales Wednesday…. The San Diego-based company said that prices were up 29.2 percent from the previous March in Alameda County to $575,000. In Contra Costa County, prices rose 22.8 percent to $425,000. Santa Clara County gained 20.3 percent to $800,000, and San Mateo County was up 13.2 percent to $860,000.

Whether you buy or rent, prices have been rising dramatically.  When factoring in what housing will cost, include the trajectory of appreciation per month.

What does it cost to buy a house in Santa Clara County? And San Mateo County? Both are home to “Silicon Valley”!

Silicon Valley is a large area, with much of it in Santa Clara County (where San Jose is the largest city with almost one million residents) and most of the rest is in San Mateo County along the San Francisco Peninsula.   So what does it cost to buy a house in these areas? Today I spent some time on MLSListings.com, our local multiple listing service, and pulled the data, which I hope that newcomers will find very helpful.

Below is a chart of single family homes purchased between October 1 2013 and the end of January 2014 by price point.

Santa Clara County sales of single family homes:

Santa Clara County home prices Jan 2014

As you can see, only a tiny fraction of homes sell for less than $400,000.  Most people pay between quite a lot more, with many sales happening in the $600,000 to $1,000,000 range (and it’s more in the areas with best schools and short commutes, generally, so many are much higher, too).  The average Santa Clara County home sales price was $1,002,119 and the average price per square foot was $526.

How about San Mateo County prices?  As you may know, The Peninsula is pricier than it’s warmer neighbor to the south. But how much more will it cost you?

Santa Clara County sales of single family homes:

San Mateo County home prices Jan 2014

The average sales price was in San Mateo County for the last three months was $1,254,114 and average price per square foot was $625 (all sizes of houses and lots throughout SMC).  This is about 20% than Santa Clara County.

Welcome notes and a word about rental housing in Silicon Valley

Although normally I prefer to take photos than be featured in them or in videos, many of my Realtor friends from across the country have been telling me that our blog readers would like to see us on video (and not just read our typed words).  So I’m caving in – and saying hello!  Hope you enjoy this 4 minute video, shot from my home office in Los Gatos.

Guest Article by Vivek Ranadivé: “Discrimination in Silicon Valley is a Myth”

Florence Il Duomo Santa Maria eli FioreA few days ago I read the article below in the San Jose Mercury News, penned by Vivek Ranadivé, on the topic of discrimination in Silicon Valley.  I loved his striking analogy to Florence, Italy, during the Renaissance – a place where I studied in college – and thought that this piece had a lot of merit.  The one caveat, though, is that in my experience there is certainly a very pronounced, impossible to miss age discrimination in Silicon Valley among the high tech companies.  Anyone more than 50 or 55 years old may feel that his or her job may be cut at any time and handed to a younger, less expensive employee.  Once this last holdout of bias is gone, then perhaps the correlation with exquisite Florence will be exact. The article below is republished with permission. – MPH

Discrimination in Silicon Valley is a Myth, by Vivek Ranadivé

Lately, I’ve been hearing criticism about diversity in Silicon Valley that deeply saddens me. Some people seem to think that gender and race discrimination in the Valley are still roadblocks to career advancement, preventing some people from pursuing opportunities given to others.

I disagree with this completely.

It’s no secret why scores of foreigners flock to Silicon Valley each year. It’s home to some of the best universities, some of the world’s most innovative companies and some of the brightest minds in history. It’s a region that prides itself on disrupting the status quo and pushing the envelope.

What I’ve witnessed in my 30 years in the valley contrasts starkly with recent criticisms.

Since day one, it has welcomed me, and many other Indians, with open arms. And not just Indians — any ethnic group willing to pour their hearts and minds into developing the “next big thing.” Take a walk through the hallways of any business in Silicon Valley and you’re likely to witness a melting pot of young intellectuals from every corner of the world. Silicon Valley not only embraces ethnic diversity, it highly encourages it. That’s what has made this region so successful.

I like to compare Silicon Valley to Florence during the Renaissance. Led by some of history’s brightest and most progressive minds, Florence was the world’s epicenter for art, music, politics and technology. If you wanted to make a name for yourself in the early Renaissance, Florence was where you had to be. The parallels to Silicon Valley are clear — from the Traitorous Eight to the late Steve Jobs to the Google and Facebook guys, so many of the most innovative and intelligent people of the past half-decade have lived and flourished here. As a result, the valley continues to attract the best and brightest from all over the world. Continue reading

Is it better to rent for awhile, or purchase a home when you first move to Silicon Valley?

Buy or rent firstIs it a good idea for newcomers to Silicon Valley to rent for a year, or smarter for them to purchase right away?  Normally, I would suggest deciding where you want to live generally (example, Almaden area of San Jose 95120) and renting there for a bit first just to make sure it’s where you want to be.  This is especially true if you have children who will be in public schools, as it can be rough on them if they change again once you’ve been here for awhile.   Renting first enables you to learn the area and takes some pressure off.  Also, it can take some time to move money from overseas for your down payment, so the little extra time can help there, too.

However, many people want to buy immediately and will make several trips here before the move to find and purchase a home.  Often this is because they see the value in owning (tax benefits, getting kids into certain schools).  I’ve had many people tell me that it helps them to establish themselves in their new community faster if they buy rather than rent.

Right now interest rates are very favorable.  Lawrence Yue, the chief economist for the National Association of Realtors, recently stated at our annual conference in San Francisco that he’s expecting interest rates to go as high as 5.4% by the end of 2014 (as of right now, it’s hovering between 4.125 and 4.25%).

What does this rise in interest rates mean in terms of housing affordability?

$500,000 mortgage, 30 year fixed at 4.25% = monthly payment of $2459

$500,000 mortgage, 30 year fixed at 5.4% = monthly payment of $2807

Difference = $348, or a 14% increase in the monthly payment

Or, let’s look at it in terms of buying power.

$2500 mortgage payment, 30 year term at 4.25% = loan amount of $508,192

$2500 mortgage payment, 30 year term at 5.4% = loan amount of $445,211

If the interest rate goes up to the 5.4% that the NAR chief economist expects, that cuts into the buying power of a $2500 payment to the tune of almost $63,000.

For most people, the cost of waiting is a significant factor in this buy vs rent decision.  My concern is that many people who elect to lease or rent for a year do not understand the risk that may accompany waiting. For most folks relocating to the San Jose or Peninsula area, the hardest thing to manage is the cost of housing.  This could become substantially worse by putting off the purchase for a year, so right now I cannot recommend doing that.  The low interest rates are a gift that won’t be around forever.

Want more info?  Please see my Valley of Heart’s Delight blog, with the related article
How will rising interest rates impact your home buying power?

What does it cost to buy a 4 bedroom, 2 bath home in the West Valley areas of Silicon Valley?

It can be really challenging for people moving to Silicon Valley to get a sense of pricing for home buying.  So to compare “apples to apples”, let’s take a hypothetical case of a 4 bedroom, 2 bath home of approximately 2,000 SF house (appx 185 square meters) and see how the cost looks in one are versus another.

Tonight I compared several areas and cities using the same formula: homes of 1800 – 2200 SF, 3-5 bedrooms, 2-3 bathrooms, on lot sizes of 6000 SF to 10,000 SF.  Here’s how it shakes out in the “west valley areas” along the Highway 85 corridor. What areas are most affordable?  One way of analysing this is the “price per square foot” figure.   How competitive is it? Have a look at the DOM or “Days on Market” figure.  All of these days on market are short, but they range from low to heart-skippingly fast.

West Valley 4 bedroom home comparison November 2013

In most cases, the most expensive and desirable places have either the best schools or shortest commute location. Had I ranked these for school scores, you’d find that Cambrian is fairly high up and a good “bang for the buck” location – though not a super short commute for folks who work in Mountain View (though not so bad for people working in Cupertino).  None of these is especially close to North San Jose (Cisco). Continue reading

Celebrating Halloween in Silicon Valley

Halloween HouseIf you are new to Silicon Valley, you may wonder what the customs are around Halloween, which is always October 31st.   It’s pretty simple.  Kids get to dress up in costumes and go door-to-door in residential areas (houses, usually, but also condos, townhouses and apartments) and say “Trick or Treat” and receive the treat, which normally is candy.

People in homes are expected to have candy of some sort to give away if they have their lights on, a jack-o-lantern burning or any Halloween decor. If the house is dark or unlit, it should be skipped. Most houses will have a jack-o-lantern, meaning a carved pumpkin with a candlelight (or something similar) in it.

In some areas, such as the Almond Grove area of Los Gatos, homes may get as many as 200 kids in an evening!  In other areas, where homes are spread out or for some other reason it’s not so popular, there may be 20 or less.

Finally, parents should accompany children as they go door to door.  Candy is not given to adults – it is tacky for grownups to come with a bag or even in costume to collect sweets. Don’t do it, you’ll appear greedy and uncouth. It is also uncool for trick or treaters to expect candy if not in costume.

Have fun and be safe!

Happy Halloween!

Where do people in Silicon Valley go for snow skiing, snow boarding, and cross country skiing?

SnowboardSnow sports are very popular with Californians, whether it’s downhill skiing, cross country, snowboarding or snowmobiling.  If you move to Silicon Valley, or anywhere in the San Francisco Bay Area, where is the nearest ski resort?  The closest sites are all in northern California, of course – but there are more in SoCal, so if your travels bring you closer to LA or Palm Springs, you will want to research southern California ski resorts.

The shortest travel time for snow boarding, skiing and cross country seems to be Bear Valley, which is about 3 hours east of San Jose and Santa Clara County.  Not bad!

A more popular area, though, is a little further: Lake Tahoe.  This spectacularly scenic area straddles the states of California and Nevada and people speak generally of “north shore” and “south shore” Tahoe.  The resorts are spread around the region and include spots at Truckee and Donner as well as closer to the water.   There are 15  resorts in all!  Some have higher elevations (such as Mt. Rose), so they will be open later into spring than those closer to the lake.  If you want to gamble and see shows, you will likely find yourself drawn to either Reno or South Shore, since they are in Nevada and casinos abound.  Some of these resorts have shared season passes (such as Squaw and Alpine).  A good site which gives and overview of each one is: http://www.onthesnow.com/lake-tahoe/ski-resorts.html    This tends to be about a four to five hour drive unless there’s terrible traffic, an accident, bad weather – in which case, it can be many times as long a drive.

Yet another beautiful place to ski is Yosemite Valley’s Badger Pass. Yosemite, like Lake Tahoe, is a beautiful place to visit year round.  (For Tahoe, winter and summer are strong tourist months, and there are often great deals on hotels in the “in between” seasons – between skiing and golf or hiking.)

How long is the ski season in northern California? The weather varies from year to year but often snow skiing season begins in November and finishes in March, but it all depends on the snow levels and temps.

It’s not too soon to begin planning your snow adventures!  Have a great season!

 

Which Silicon Valley areas are the most European feeling?

Beckwith Building in downtown Los Gatos, California

The beautiful Beckwith Building in downtown Los Gatos, California

I have been fortunate to have made 5 trips to Europe, one of them lasting 9 months, and will be returning again before the end of 2013 (this time to Belgium).  It is so diverse, beautiful and compelling! Having experienced a little culture shock myself (when living in Florence, Italy, for one year of university), I’m very sympathetic about how hard an international move can be, and I understand that for Europeans moving to Silicon Valley, there can be an acute culture shock, particularly for those coming from more rural areas.

The bulk of Silicon Valley is located in Santa Clara County, which is at the southern end of the San Francisco Bay.  In this county, there are approximately 1.8 million people, almost a million of them in the city of San Jose.  Some areas, or districts, of San Jose have a distinctive character and are almost like towns or small cities themselves.  So in this article I’ll mention both cities and towns, but also areas or districts of San Jose, which might appeal to our European transplants.   Most of my comments will reference Santa Clara County or “south bay” locations, but I will also mention others on the San Francisco Peninsula and SF Bay Area too.

Architecture, Urban Centers and Charm

It is an unfortunate negative in Silicon Valley that much of our housing consists of ranch style tract homes, and truthfully, they are not exactly a work of art.  New or newer homes tend to be on very tiny parcels of land (or “lots”) and for many people may simply feel too congested or crowded. But there are beautiful residential neighborhoods – you just need to know where to look!  In many ways, the areas with higher charm can make our global home buyers feel more comfortable than if they were faced with only track, ranch neighborhoods.

Do you value unique, older architecture with Victorian, Craftsman, Tudor or other home styles? Then check out these areas:

  • Within San Jose: the Japantown, Vendome, and Naglee Park areas of downtown San Jose. Also in central San Jose are the Rosegarden, Shasta Hanchett and Burbank neighborhoods which all boast some lovely older homes.  Or, if you love classic Spanish Revival style homes with views, consider the old Alum Rock area of San Jose near the country club (golf course).  The Willow Glen area of SJ (zip code 95120) is full of lovely old established neighborhoods with historic homes and tree lined streets.  If your job takes you to downtown San Jose, all of these areas will be fairly close.
  • If you want a rural, eclectic atmosphere, check out the “New Almaden” area of San Jose.  This is actually a county pocket with a San Jose mailing address.
  • Other towns or cities with older, more interesting architecture include the “downtown” ares of Los Altos, Palo Alto, Los Gatos, Campbell, Mountain View, Saratoga and Menlo Park (in San Mateo County, just north of Palo Alto).
  • If work will be on The Peninsula, there are many areas nearby that may work.  San Mateo has some fantastic neighborhoods!  Also San Francisco, which is tiny but full of beautiful areas, may be a strong draw (I do not sell there – it’s too far for me).   Warning: the weather in San Francisco is very often COLD in summer!
  • Across the bay, Berkeley has some great Victorian and other homes and several really interesting pockets, as does parts of Oakland.  (I do not work these areas either as they are too far for me, but I did live in Berkeley in graduate school and can connect you with a great agent there.)
If what you want is a “walk to town“, urban experience, many of the areas above will work for you.  Additionally, there are a couple of more recently built areas that might appeal to you – Santana Row in San Jose (along the Santa Clara border) or the Rivermark area of Santa Clara off of highway 237, close to the bay.

Mary Pope-Handy

1-408-204-7673
Realtor,
CIPS, CRS, ABR, SRES
Sereno Group
Los Gatos (Silicon Valley)
California, USA
mary (at) popehandy.com
CA BRE # 01153805

Connect with Mary

Follow Mary on FacebookFollow Mary on TwitterFollow Mary on TwitterFollow Mary on YouTube

Mary’s Silicon Valley Blog