Realtor Magazine ran an article declaring that many global home buyers consider U.S. real estate prices a bargain. (Related article that was the basis for this piece can be seen here.) Get into these articles just a little bit, though, and you can see that San Francisco and San Jose are exceptions, as are Los Angeles and San Diego:
The study found the following major markets were the most unaffordable:
- Hong Kong
- San Francisco
- San Jose
- San Diego
- Los Angeles
This study included medium and large cities. But what do you think would happen if they looked at the most desirable cities and towns nearby, the suburbs with low crime and great schools (or the areas of those 2 cities with the same)? That’s right, it’s worse – much worse.
Nicer suburbs will really cost you, especially those on “The Peninsula” or San Mateo County. Here’s a glance at the median and average sale price of houses sold last month (June 2015). Countywide it is $1,300,000 with homes selling at about 110% of list price.
Heading south does help. Just as San Jose is a little less expensive than San Francisco, so, too, is Santa Clara County a bit less than San Mateo County. San Jose considers itself the Capital of Silicon Valley – a big suburban, sprawling city of 1 million people reaching out to meet cities like Cupertino, Mountain View, Sunnyvale, Mountain View, and Santa Clara all here in the South Bay’s Santa Clara County. It’s not cheap here, of course. But compare the $1 million median sale price of a home here compared to $1.3 million a little north of here, and you’ll understand why it’s not just the better weather than brings people a little further south (the Peninsula gets more wind and fog than the South Bay does, generally).
These are tough realities for newcomers to the area, whether buying or renting (rents are possibly harder to swallow than purchases). I’d be doing you no favors to sugar coat the situation. Some companies will help by improving your relocation benefits package. None of them will enable you to move here and get as nice a house as what you’ve got elsewhere for a reasonable amount of money. They cannot and will not pay you enough for that to happen.
Even so, it’s worth it to make the leap. There’s so much to love about this vibrant area: great minds, fabulous international flavor, excellent education, wonderful weather with 300 sunny days a year in a subtropical climate, access to nearby beaches, San Francisco, the Monterey Bay, Wine Country and so much more. (And you don’t need to go to Napa or Sonoma for wine – there are about 2 dozen wineries in Santa Clara County alone! See A visit to Ridge Vineyards in Cupertino as one example.)
Silicon Valley residents will sometimes refer to “South County”. Where is it? This is the area south of south San Jose where you find Gilroy, Morgan Hill, San Martin and nearby areas.
The south county region of Santa Clara County is the last real stronghold of agricultural land in the valley (that plus the eastern range by Mt Hamilton). There you will find many orchards, vineyards, farms and ranches even today. As you drive through Gilroy you may catch a scent of garlic – particularly if you drive highway 152 toward Pacheco Pass as you go past a garlic processing plant! In summer you will want to visit the famous “Garlic Festival” at least once, if not make it an annual event.
South County is home to the discount Outlet Malls in Gilroy (at Hwy 101 at 152 east), so if you live in or near San Jose, you will eventually find your way there!
Want to relocate to South County? Many San Jose area residents consider it a good place to retire since they can downsize to a comfortable home and often pay much less than a comparable home might cost in Los Altos, Saratoga, Los Gatos, Willow Glen or Almaden and at the same time get more home. A number of my clients have spoken of wanting to retire into the Eagle Ridge Golf Course area of Gilroy for that very reason.
View a map of South County on Google maps.