Today we’ll share the market reports for three Silicon Valley Counties. These are from December 2022.
Santa Clara County, San Mateo County, and Santa Cruz County are the areas covered below. Generally, “Silicon Valley” is 95% within Santa Clara and San Mateo Counties, plus a little of Santa Cruz County and a small part of Alameda County. Alameda County uses a different MLS system, and we don’t usually sell there, so we are not covering it in this post.
Each section below includes first the data for single family homes and then condos and townhomes for each region.
If you’re ready to dive a little deeper, we also provide regular monthly market updates on some of the popular communities within Santa Clara County over at my Valley of Heart’s Delight blog. Scroll the most recent ones here.
December 2022: Three Silicon Valley Counties
Santa Clara County Real Estate Market Report for Dec 2022
The first of the three Silicon Valley counties is Santa Clara County – home to San Jose, Cupertino, Sunnyvale, Mountain View, Palo Alto, Los Altos, Santa Clara, Campbell, Los Gatos, Saratoga, Monte Sereno, Milpitas, Morgan Hill, and a number of other cities and towns. This county is the heart of Silicon Valley.
If you’re having trouble reading any of the charts on this page, click to open the full size image.
The market is clearly cooling with longer days on market, fewer sales, and a falling median sales price.
The condominium and townhouse report for Santa Clara County
While it had fewer than half the sales of the single family home market, the condo and townhouse market is also experiencing similar trends.
Keep reading for updates on the San Mateo and Santa Cruz county markets.
Sometimes people relocating to Silicon Valley tell me that they’d like to move to a waterfront home, something with a view of the Pacific Ocean or the San Francisco Bay. Most of Silicon Valley is inland, though, separated from the ocean by the coastal mountains.
Ocean View Homes
For those truly set on having a view of the Pacific, home can be found in the Santa Cruz area with lovely ocean and Monterey Bay views. The compromise will likely be a long, winding commute over Highway 17’s mountain pass.
Similarly, ocean lovers may settle close to Half Moon Bay or Pescadero, but will have to slog over the coastal hills on Hwy 35 each day to get to the Peninsula. (Some lucky souls may find employment in Scotts Valley or along the coast, but most of the jobs are not in these places.) If faraway ocean view will work, a home in the Santa Cruz Mountains may be the ideal fit.
Silicon Valley Waterfront Homes
If you want to live along the waterfront within Silicon Valley and not these neighoring communities, there really are not a lot of neighborhoods from which to choose. Most water-view homes involve the San Francisco Bay. There are a few rivers, creeks, ponds (mostly man-made or percolation), lakes, and reservoirs to be found as well, but enjoying lovely water views up close is not the easiest criteria to fill and each come with their own concerns. Waterfront bay views often come down to Foster City and Redwood Shores, which we’ll discuss next. (more…)
Silicon Valley retirement can be challenging for those already living in the San Francisco Bay Area, but it’s even more challenging for those hoping to spend their Golden Years here if they are coming from a less expensive area. Today I want to give some info on:
- what does it cost to buy a home here (typical retirement size home)
- what are typical HOA dues
- what are typical property taxes
- what are some of the housing options that retirees or seniors have when relocating to Silicon Valley?
Silicon Valley retirement: what a modest home costs to buy here
The average sale price of a condominium in Santa Clara County is over $1 million (and it’s even more in San Mateo County), and that includes the range from most pricey to most affordable (and often most remote) locations. In most of the Unites States, a million dollars will get you a high end house on a comfortable lot. Houses are averaging around $2 million, so that is out of the question for the majority of retirees who move here from out of the area.
If a family member wants to come here to retire, most likely he or she will want to pay cash for a home so that there is no mortgage payment in retirement. If the budget is $1 million or less, that’s likely to mean purchasing a condo or perhaps a townhouse. In Santa Clara County, here’s where the money would go furthest:
A 2 bedroom, 2 bath unit…
Silicon Valley retirement costs will be vastly different between Palo Alto and Gilroy. San Jose will generally be more affordable than most of the rest of Santa Clara County except for the “South County” areas of Morgan Hill, San Martin, and Gilroy. San Jose is home to about a million people, and it has more and less expensive areas, of course.
The average sale price of a 2 bedroom, 2 bath condominium in San Jose in the last 30 days was $748,797. The average square footage was 1160 SF,
One of the simplest ways of assessing the real estate market is to check the absorption rate, often called the months of inventory.
In short, it tells you the pace of home sales (beyond the simpler days on market). It informs you:
- if you’re buying, whether or not you need to hurry or if you can take your time!
- if you’re selling, this figure tells you what the odds are of your success in the next month. That could impact your selling strategy.
What is the months of inventory, or the absorption rate?
The absorption rate tells us how quickly the current inventory will be absorbed, or sold off, if sales continue at the same pace and no new inventory were to be added.
The absorption rate could be measured in days, weeks, months, years, or decades – but the most common is the months of inventory. It’s really two data points in one: the available inventory and the number of sales in a particular period of time.
If this is hard to picture, consider a bathtub. If the tub is draining, how long will it take until the water is gone if the faucet is left off and if water continues to exit the tub at the same rate? That is the pace we are considering for homes for sale.
When homes are selling fast, in 30 days or less, often the data is described as days of inventory rather than weeks or months.
What is a fast absorption rate, and what does that mean for home sellers and buyers?
A balanced rate of sales suggests that neither home sellers or home buyers have a real advantage over the other. In the United States, anywhere from 4 – 6 months is considered balanced. Less than that is a seller’s market, and more than that is a buyer’s market. The lower the number, the hotter the market.
In Silicon Valley, though, it’s almost never as high as 4 months – though it can and does happen sometimes.
For us, anything under 2 months is a hot market, and anything under 1 month is a super hot seller’s market.
Here’s a graph displaying the absorption rate for houses in Santa Clara County between January 2005 and now. The highest absorption rate was 14.2 in January 2008. It fell quickly from there with the next month at 12.4, then 10.1 in March, and eventually settling in at around 6-7 months of inventory for a period.