Today we’ll take a look at the housing market from a very high overview position, that is, by metro area within California. How’s the San Francisco Bay Area, which includes Silicon Valley, faring in comparison to the rest of the state? And how is the real estate market within the 9 Bay Area Counties? Have a look at the statistics to get a sense of the market at a glance. (Note: SFH stands for Single Family Homes.)
Silicon Valley is found primarily in Santa Clara County, but also substantially in San Mateo County. There are some pockets, very small, also in Alameda County and Santa Cruz County. Santa Cruz County is not considered part of the SF Bay Area, but part of the Monterey Bay Area and the Central Coast (the SF Bay area is considered Northern California.)
What’s going on with the Silicon Valley real estate market? Is it as crazy as ever with multiple offers, overbids, and few or no contingencies?
In many cases, yes – especially in the more affordable price points in areas with good schools and shorter commutes. Those areas are the ones most in demand. And as before, comparing the three counties (San Mateo, Santa Clara, and Santa Cruz), San Mateo is the most expensive and overall it becomes less expensive in Santa Clara County, then less expensive still in Santa Cruz County. Alameda County has a little of Silicon Valley, but that area is in a totally different MLS system so is not part of this analysis.
What does it cost to buy a house in Silicon Valley?
In Santa Clara County (home to Palo Alto, Cupertino, Sunnyvale, Mountain View, San Jose, and my own Los Gatos), the average sale price is about $1,150,000 and the median sale price has been bouncing around in the $900s range for the last few month.
In San Mateo County (home to Redwood Shores, Foster City, Menlo Park, San Mateo), the average sale price is in the range of $1.4 to 1.5 million for houses recently sold. The median is a little lower, closer to $1.2 million.
In Santa Cruz County (Santa Cruz, Scotts Valley, Aptos, Capitola, Soquel), it’s more affordable. The average sale price of houses recently has been in the 800s, and the median sale price has been right about $700,000.
How is the year over year appreciation in these different parts of Silicon Valley?
Naturally, it’s easier to buy near Santa Cruz than in San Jose, but the demand tends to remain stronger in the areas with the jobs as opposed to the coastal communities, so appreciation is usually stronger in the areas where it’s hardest to purchase. That seems to be true in a very similar way in San Mateo County, too – yes, it’s less costly to buy in Half Moon Bay, and in an up market it’s great, but in a down market it will not fare as well as Belmont, San Mateo etc.
Santa Clara County
Santa Clara County – prices up over 2014 by 6-8% appx
- Median home prices increased by 7.9% year-over-year to $917,000 from $849,975.
- The average home sales price rose by 6.4% year-over-year to $1,157,360 from $1,088,090.
- Personal note: appreciation in this range is fairly sustainable, as compared to the appreciation in 2014, which was closer to 20%. Double digit appreciation is usually a little worrisome since it often is not sustainable.
San Mateo County
San Mateo County – prices up from last year
- Median home prices increased by 21.9% year-over-year to $1,170,000 from $960,000.
- The average home sales price rose by 3.7% year-over-year to $1,482,950 from $1,429,870.
Santa Cruz County
Santa Cruz County – prices off year over year
- Median home prices fell by 0.4% year-over-year to $700,000 from $702,500.
- The average home sales price dropped by 10.4% year-over-year to $801,516 from $894,204.
Within all of these market areas, there are hotter and cooler locations, school districts, price points, etc. Often there are work arounds to maximize the sale or purchase of a property. For instance, some homes have a pool that eats up the whole yard. That might make a home difficult to sell, so perhaps you can buy it without competing against so many offers – and then remove the pool later. Often the “fixes” are not as costly as you may think.
Want to buy or sell in Silicon Valley? Please reach out to me. I’d love to chat with you about it and see if we might work together.