The shock of Silicon Valley housing costs: how little you can buy on a huge income

Relocation Housing Costs: how little you can buy on a huge income in Silicon ValleyIf you’re relocating because you’ve just been hired as a high level executive at Apple, Google, Microsoft or any other high tech or biotech firm in Silicon Valley, you may be coming to the San Francisco Bay Area and Silicon Valley from an enormous home (5,000+ square feet) on an enormous lot (1 acre +). You are a raging success. You are highly regarded. You are on the top of your game. Your house “back home” displays your accomplishments. What about your Silicon Valley Home?

Housing Costs & Relocation

Set Your Expectations

You’ve heard that prices are bad here, but how much worse could they really be? Surely you could downsize a bit to a 3,000 to 3,500 square foot house on a half acre with a 20 minute commute, right? And you’d still have great schools for “resale value,” right? You are prepared to give up the full basement, the pool and tennis court and the 4 car garage. That is enough of an adjustment, isn’t it?

No, I’m sorry to say, it isn’t.

That house you are leaving behind in the suburbs of New York, Connecticut, Massachusetts, Chicago, Denver, Miami, Seattle, San Diego, or wherever you’re coming from is a super high end luxury home. It’s probably worth $1,500,000 to $2,500,000. But guess what? Here, in a nice area, that’s a 2,000 SF house on a 10,000 lot in a good area that’s a tear down. And in traffic, it could be a +40 minute commute.

Want an acre in an area with really good public schools at all levels? Think $4 million plus. And that doesn’t mean that the house will be turn-key. You will very likely have to remodel or personalize so that you are happy with it, as most of our houses were built between the 1960s and 1980s. (Here a 25 year old home is considered relatively young.)

Setting expectations is a battle of it’s own. If you’re having trouble coming to terms with the price of homes here and seriously want to buy, or maybe you’re wondering why your offers aren’t working out, you may find this article helpful for introspection: Silicon Valley housing prices and the emotional stages they’ll put you through. And if you aren’t already working with an agent, getting good professional help is one of the #1 ways to succeed in this market, so make sure you know how to find and keep a quality agent! We love working with our blog readers, so always feel free to reach out if you’re in need!

Why make the sacrifice to live in Silicon Valley?

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California and Bay Area Real Estate Market at a Glance

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.)

Statistics for Bay Area Real Estate Market

Statistics for Bay Area Real Estate Market care of the California Association of Realtors

Traffic patterns in Silicon Valley

On another of my websites, I wrote about congestion and traffic patterns on Silicon Valley highways and roads.  For many transplants to the San Francisco Bay Area and especially the Peninsula and South Bay areas, traffic is an enormous consideration on where to live and how much to pay for real estate.

If this is a topic that interests you, please take a look:

http://popehandy.com/understanding-silicon-valley-traffic/