With soaring housing prices in Silicon Valley, newcomers and folks potentially relocating here may wonder what can you buy for $1 million or less in Silicon Valley? This article will provide a snapshot in time and provide a sense of whether your million dollar budget can get you into a house, a townhouse, or a condo – or perhaps “none of the above” – on the valley floor.
(Homes in the Los Gatos or Santa Cruz Mountains are generally more affordable, but will of course be farther out and are generally considered a specialty market. Not included will be mobile homes, as the space rents are often close to or more than $1,000 per month. Also not included are duplexes, which you’d be hard pressed to find many of under that $1 million mark.)
If you absolutely must buy a house, and the budget must be under $1 million…
If you absolutely must have a house or single family home, as opposed to a condominium or townhouse, there are a number of areas for you to consider in Santa Clara County, including
- Gilroy
- Morgan Hill
- Milpitas
- Certain districts in San Jose
- Alum Rock
- South San Jose
- Evergreen
- Berryessa
- Downtown and Central San Jose
- Santa Teresa
- and Alviso (including County pockets)
- the Los Gatos 95033 (mountains) area – which is vast and contains many small communities
The Los Gatos mountains area varies in price from one community to the next and right now that is a hopping market, I’m told. You can find information, including a list of mountain neighborhoods, on the page linked as well as the occasional market update. If you’re interested in buying or selling a mountain home here in the Bay Area, please reach out! I do some work in the mountains, and if it’s not a match I am happy to connect nice folks with trusted Realtors that are mountain market specialists.
To determine where someone could get into a house for under $1,000,000, I pulled the sales from the last 90 days (as of August 31, 2021) and looked at how many of the sales of houses for any given area were under that budget amount. In many places, there were zero – even if I looked back a full year! The areas below are listed in order of the average sale price for these “in budget” properties, though you might prefer to rank them by the average square footage or some other criteria.
(Trouble reading the image above? Click to view the full-sized photo.)
This doesn’t mean you can’t find something under $1mil elsewhere. San Jose’s Almaden Valley, Willow Glen, and Cambrian areas each had one sale under the million-dollar mark during the same time period, but these sales are significantly less common. When you see ratios of something like 3% or less of the houses sold are under that price point, it’s important to understand that those homes may be major fixer uppers, tear downs, or have a location issue or some other big challenge. But – perhaps you are handy, do not mind the property condition, location, extremely small size, or whatever the presenting issue may be.
Areas in Santa Clara County where a house is possible but unlikely, but a townhouse or condominium may work:
Some truly long-shot, but perhaps possible, areas include Willow Glen (San Jose), Cambrian (San Jose), Almaden Valley (San Jose), and Campbell. In most of these desirable locales, a townhouse or condo is very doable, but a house – not too likely.
(Trouble reading the image above? Click to view the full-sized photo.)
What about condos or townhomes? Except for areas with stratospheric pricing like Palo Alto and Los Altos, a good condo or townhouse under $1 million should be possible in virtually all of Santa Clara County.
Areas where you will NOT find a house for under $1 million
If you absolutely must buy a house, and not a condo or townhome, skip Palo Alto, Los Altos, Los Altos Hills, Saratoga, Santa Clara, Los Gatos (except in the mountains), Monte Sereno, Sunnyvale, Cupertino, and West San Jose. It just isn’t going to be in budget.
What about San Mateo county?
In general, San Mateo County is more expensive than Santa Clara County. However, there are some pockets that may work.
Silicon Valley really includes the bayside areas of SMC, not the side that is along the Pacific Ocean. The beachside areas and costal ranges are more affordable, but you will find the commute to be a bit arduous if you are working in central Silicon Valley. That said, costal towns have experienced increasing demand and in the last 90 days Half Moon Bay, Pacifica, and Moss Beach have each had only one sale under $1 million dollars. So that price point is definitely a long-shot.
Mountain communities like La Honda (3 out of 6 sales under $1m), Pescadero (1 out of 2), and Loma Mar (2 out of 3) still have regular inventory in this price range.
Redwood City is a good value area overall. The schools do not rank as highly as some other areas, and the plus to that is that home prices are a little more affordable. In the last 90 days, 9 of 210 sold houses were under $1 million. That’s not a high percentage, but it’s not impossible. More likely, you’ll get a far nicer townhouse with more space than you would a house in Redwood City, so keep your options open there!
East Palo Alto has been coming into its own, steadily improving, and showing itself to be a good value area. In the last 90 days, 12 of the 28 homes sold went for $1 million or less. Yes, that’s hardly any inventory, but it is in range – so keep your eye on it.
Daly city had 12 of 109 homes go for $1 million or less, South San Francisco had 5 of 81 homes sell in range, and San Bruno had 5 out of 83. These communities are definitely worth checking out, especially if your work takes you to Redwood City or South San Francisco.
Brisbane had 2 of 14 sales sold for $1 million or less (although the inventory is small enough that you shouldn’t count on it).
The rest of the areas were either highly unlikely or a slam dunk “no” to selling in budget for a house.
What about the East Bay?
The east bay tends to be more affordable than the south bay or Peninsula. I did not check into those areas as I don’t know them as well (though I did live in Fremont for a year when I went to grad school). The bridges can get quite backed up. Over time, I believe that “Silicon Valley” will creep more and more into the east bay, both Alameda and Contra Costa Counties.
Some home buyers just must have land, a yard, a detached home. For these buyers, it is imperative to not spin wheels trying to locate a single family home in areas where they simply won’t be “in budget!” In Silicon Valley, the usual remedy is “drive a little, save a lot”. Hopefully, once BART comes through, the driving will be a whole lot less!
Click here to view homes for sale listed at under $1,000,000.
