The San Jose Real Estate Market Analysis

San Jose Real Estate MarketThe San Jose real estate market remains in a hot seller’s market, keeping active into winter with slight seasonal cooling. Demand may have shrunk between rising rates and inflation, but inventory remains historically low so it’s still far from balanced!

First, some quick data from my RE Report and hand-pulled from the MLS today. There appears to be a small amount of under- or over-counting between the RE Report and MLS Listings, so numbers vary slightly between the two, but the data is still useful for trend tracking.

  • The January 2024 sale price to list price ratio for San Jose single family homes rose to 104.7% of asking, that’s +1.6% from last month per the RE Report and +6.1% from this time 2023, following the bottom of the market’s decline. For the MLS stats we pulled today, however, it shows 104.4% average, up from 102.8% (+1.6%) the month prior. Either way, the average home is selling consistently over list price in San Jose, and warming up into the new year.
  • Home values for single family properties are up from this time last year by approximately 8% – 19%, and month-over-month closed sales prices rose around 1% – 5%.
  • The time on market slowed slightly month-over-month to a 22 day average (RE Report). That’s still quick turnover averaging well below a month, indicating a clear seller’s market.

Market Data: What Numbers Make a Difference

While prices and overbids have fallen since the peak, in some ways 2023 was even more challenging for buyers. For most buyers, their ability to purchase has been severely impacted by higher rates on home loans and the changing insurance market. But the biggest hurdle for most buyers is the extreme and persistent lack of available homes!

Since March 2023 San Jose has frequently had record breaking low inventory, often marking new lows with the fewest available listings by month in over a decade. And it doesn’t look like inventory will really pick up any time soon, either.

Why such low inventory?

While in a more typical market we might have a number of sellers looking to “move up” or downsize, most homeowners today couldn’t afford to move or don’t want to take on a higher-rate mortgage. Now it seems like a higher percentage of the listings we are seeing comes from investors, people leaving the area, and sales by family after a death – cases where there is no pressure to repurchase or where selling is the only option. One exception we’re starting to see is homeowners with adjustable rate mortgages who don’t have the same low rate to hold on to at their current home. Still, that limits significantly what is available to buyers!

Although inventory remains at record-breaking lows with higher demand than availability, sale prices and overbids are not breaking records like last year’s spring peak. Many buyers are experiencing significantly more pressure from higher interest rates, fluctuating stocks, looming layoffs, and other factors limiting purchase power and lowering confidence. That said, not every home will face the same challenges – there are loads of micro markets that influence how well any given home does, and decent homes that are marketed appropriately still regularly become bidding wars for driven buyers. All said, take this city-wide data with a grain of salt.

 

Inventory - San Jose CA listings of houses / Single Family Homes for sale

 

Inventory remains severely low – currently showing the second lowest January inventory over more than a decade (only January 2022 was lower)! If you’re an active home buyer, it is slim pickings!

The data below in the “trends” chart is from our Real Estate Report for the City of San Jose.

San Jose Real Estate Market Trends at a Glance (RE Report)

 

Trends At a GlanceJan 2024Previous MonthYear-over-Year
Median Price$1,600,000 (+4.9%)$1,525,000$1,347,500 (+18.7%)
Average Price$1,693,940 (+1.0%)$1,677,520$1,563,350 (+8.4%)
No. of Sales157 (-25.2%)210128 (+22.7%)
Pending197 (+20.1%)164152 (+29.6%)
Active120 (+25.0%)96250 (-52.0%)
Sale vs. List Price104.7% (+1.6%)103.1%98.7% (+6.1%)
Days on Market22 (+14.1%)1931 (-28.7%)
Days of Inventory23 (+67.2%)1459 (-60.9%)

 

Available inventory is less than half of was at this time last year, while pending and closed sales have risen above 2023 numbers. Demand is extremely high! The chart clearly shows a strong seller’s market launching out of a slightly cooler December and into the new year. Winter tends to be the best time for buyers to snag a “deal”, however we’re beginning to leave the winter trends behind and spring is fast approaching! Keep reading below for more data and market analysis.

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San Jose neighborhoods

San Jose neighborhoods are spread throughout many districts and even more miles, so it’s no surprise that we see a tremendous amount of variety in landscape, commute length, school quality, and home prices.

San Jose neighborhoods: let’s start with the broad areas and districts

 

San Jose neighborhoods and districts

The major areas in San Jose generally fall into these areas – feel free to plunk any of them into the search bar to learn more, or use the navigation links in the menu for each. These are neighborhoods on a larger scale.

  • Almaden Valley / Almaden – see a list of Almaden Valley neighborhoods with links
  • Alum Rock (together with Evergreen is East Valley, East San Jose, or Eastside)
  • Berryessa / North San Jose / North Valley (North San Jose also includes Alviso)
  • Blossom Valley
  • Cambrian / Cambrian Park – we have many articles on Cambrian Park neighborhoods – check out the list and links
  • Downtown / Central San Jose
  • East Valley (see Alum Rock and Evergreen)
  • Evergreen
  • Santa Teresa
  • West San Jose (not actually a large area, mostly sandwiched between Campbell and Cupertino, but quite a few zip codes)
  • Willow Glen

Or generally by direction:

  1. North: Alviso, Berryessa are “North San Jose”
  2. East: Alum Rock and Evergreen are “East San Jose” (Berryessa is northeast)
  3. South: South San Jose, Coyote (part SJ, part Morgan Hill, part unincorporated), Santa Teresa, Blossom Valley, Almaden (Almaden is southwest)
  4. West: Almaden (southwest), Cambrian, West San Jose
  5. Downtown and Central

San Jose zip codes

What about zip codes for these San Jose neighborhoods or districts?  Almaden has 95120 as its only zip code. Most have at least two (Cambrian is 95124 and 95118 – but not all of those zip codes!). Evergreen has four.  Willow Glen is mostly 95125, but has a sliver of 95124. So it’s messy and defies easy answers except for Almaden Valley.

Each of these larger areas consists of groups of San Jose neighborhoods within them. In Almaden, there are homes near the golf course – the Country Club neighborhood, or others in New Almaden, the oldest part of that section.

How to decide which of the San Jose neighborhoods you should consider?

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Montevideo Neighborhood

Montevideo neighborhood in San Jose's Almaden Valley area San Jose zip code 95120Located close to the Guadalupe Creek and the foothills of the coastal mountain range, the Montevideo neighborhood enjoys tree lined streets and scenic green views of the hills. Houses and yards are nicely kept. It is fairly convenient for commuting as it’s not too deeply into the San Jose area of Almaden Valley. About 500 residents call this beautiful neighborhood home.

In addition to the pleasant vistas, the Montevideo home owners and residents enjoy the cabaña, which includes a community pool, clubhouse, recreation grounds (shuffleboard, volleyball court and more), a fun swim team for kids. There are very few cabañas in the west valley, so this is a big draw.

Adjacent to it is the very highly regarded Guadalupe Elementary School.

Where is the Montevideo neighborhood located?

The Montevideo neighborhood is situated close to the intersection of Camden Avenue and Coleman Road (not quite to Redmond Avenue) in southwest San Jose (Almaden area, zip code 95120). The development was built in two phases – the map below shows in a darker green the “Montevideo 2” area. The lighter area was the original Montevideo tract.

 

Map of the Montevideo neighborhood in San Jose's Almaden Valley - click on the image to go to the live map on Google

Map of the Montevideo neighborhood in San Jose’s Almaden Valley – click on the image to go to the live map on Google

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Check the months of inventory to see if it’s a good time to sell your home!

Months of Inventory explained with an hourglassIs it a good time to sell a home in Silicon Valley? One of the best ways to get a pulse on the real estate market with an eye to selling or buying is with the months of inventory (MOI), also known as the absorption rate. This is the months of supply of housing for sale.

The months of inventory tells us how fast the current inventory of properties will be sold off if sales were to continue at the same rate with no new inventory were to come on the market.

The easiest analogy is with a bathtub full of water. If we added no more water to the tub, and the drain were opened, how much time would it take for the water to be depleted if it continued to empty at the same rate? That’s the question being answered with the absorption rate of inventory.

Or, simpler still, if you have an hourglass that you turn over, how long does it take for the sand to empty from the top (since you cannot add more sand to that end)?

How to calculate the months of inventory or MOI

The way to calculate the months of inventory is simple:  find the current available inventory of homes for sale (not under contract or sale pending), then find the number of homes with that exact criteria which have closed escrow in the last 30 days.  Divide the first by the second and you get the months of inventory. Or, I can just use the stats program on the MLS to generate that number, as I did today.

Earlier I pulled this data from MLSListings.com, our local MLS association (of which I am a member) and I ran the numbers for single family homes (houses and duet homes) in Cupertino, Los Altos, Los Gatos, Monte Sereno, Mountain View, Palo Alto, San Jose (all areas combined), Santa Clara, Saratoga, Sunnyvale. Separately, I also ran this same query for the City of San Jose by district.

The months of inventory by city or town in Santa Clara County

A balanced market for our area is 2-3 months of inventory (for most of the US it’s 4-6 months). Two months or less is a seller’s market, and one month or less is a very hot seller’s market.

Here’s a look at the months of inventory by city or town in SCC in April 2023 for single family homes.  As you can see, the vast majority of the county is a strong seller’s market, with the only exception being Los Altos Hills.

 

Santa Clara County months of inventory by city in Santa Clara County - single family homes for April 2023

 

Which are the hottest markets?  They’re the ones with the smallest months of inventory -Sunnyvale, Santa Clara, Cupertino, Milpitas and many more are well under the 2 month market. A few are a tad higher and in the “balanced market” area, and only one is in a deep buyer’s market.

The months of inventory by area within the City of San Jose

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1252 Chiapas Terrace, San Jose, CA 95126

1252 Chiapas Terrace, San Jose, CA 95126 PENDING in 7 days with 5 offers!

We are delighted to present our newest listing, 1252 Chiapas Terrace, San Jose CA 95126. This young townhome provides 2 bedrooms plus den, 2 .5 bathrooms, and an open layout with 1667 square feet. It’s full over luxury upgrades, all the features that today’s buyers want, and it’s situated in the gorgeous Altura neighborhood near Santa Clara University. The list price is $989,500.

1252 Chiapas Terrace, San Jose CA 95126 - luxurious kitchen and big breakfast bar

The Quick Look at 1252 Chiapas Terrace, San Jose:

  • Altura townhome community built in 2006 by Pulte Homes
  • 2 spacious bedrooms plus den with 2 ensuite full baths, and a powder room on the main floor
  • Main floor fully open with spacious kitchen featuring stainless steel appliances, gas range with 5 burner stove, granite counters, wood cabinetry and wide breakfast bar with pendant lights above
  • Washer, dryer, and Fridge all stay
  • Attached 2 car garage with side-by-side parking
  • Central air conditioning
  • Dual pane windows by Milgard
  • High ceilings, recessed lights, plantation shutters, water softener and so many extras – see the full list at the virtual tour!
  • MLS #ML81917776

 

1252 Chiapas Terrace, San Jose virtual tour and 3D walkthrough

Please visit the virtual tour: 1252ChiapasTerrace.com for the virtual tour with all photos, a 3D iGuide walk through, and under “details” you’ll find a printable PDF with the floorplan and room measurements, too.

Open house this weekend

We will be hosting an open house this weekend,  Sat Feb 4 and Sun Feb 5, from 2 – 4 pm. Please stop by! (Park on Campbell Avenue or at the back of the complex along De Altura Commons.) These homes are very popular, so if you cannot make the open house, please arrange for your buyer’s agent to show you the home soon. It’s very easy for your Realtor to make the appointment with our simple online scheduling system. If you need a buyer’s agent and do not have one, please reach out to me and we can connect you with a Realtor who can show this home to you and represent you should you decide to write an offer.

 

Front door and porch at 1252 Chiapas Terrace, San Jose CA 95126

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Altura neighborhood

The Altura neighborhood in San Jose features quality built, younger townhouses in a convenient location. It also enjoys an expansive, neighborhood park owned by the City of San Jose.

 

Photo of part of the Altura neighborhood - these homes overlook Newhall Park.

 

Why people love the Altura neighborhood, in brief:

  • Young homes, built in 2006
  • Attractive and thoughtfully designed community
  • Close to Santa Clara University, easy access to central and downtown San Jose and Santa Clara
  • Large neighborhood park nearby
  • Double car garages with regular parking,  not tandem!

You’re invited!

We just listed a gorgeous townhome in Altura at 1252 Chiapas Terrace with 2 beds + den, 2.5 baths and oodles of luxury amenities you’ll love! It will be open this weekend, Feb 4 & 5 from 2 – 4 pm. Please stop by! Park along the back of the complex (open spots are guest parking) or on Campbell Avenue. Learn more at 1252 Chiapas Terrace, San Jose or visit the virtual tour at 1252ChiapasTerrace.com.

Where is the Altura neighborhood?

The Altura neighborhood is in San Jose but on the Santa Clara border. The major cross streets are El Camino Real (via Campbell Avenue) and Highway 880. Below is a map – you can see how convenient it is for commuting to Santa Clara University, downtown San Jose, and how easy it is to hop on to Highway 880 or Hwy 87 from here. The blue transit icons in the map below are train stations, too. Easy!

On Nextdoor, the online community of neighbors, you’ll find this is the large area called Newhall. The Altura neighborhood is in San  Jose CA with the zip code 95126.

Map of Altura neighborhood further out

 

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Are home prices dropping in San Jose?

Are home prices dropping in San Jose? The Bay Area housing market is cooling all over.

  • Overall, yes, we have home prices dropping in San Jose month over month.
  • As of now, home prices are not down year over year for the city generally.
    • in some areas, price points, or select segments, year over year prices could be up or down as compared to a year ago
    • in part of the market, the year over year number is flickering back and forth (see the $2 million pricing band, below)

Let’s see what the data says. I pulled this from MLS Listings just now for all of the city.

In what price points do we see home prices dropping in San Jose?

If we look at all San Jose single family homes (mostly houses, but a few duet homes), we can see that prices were higher in April 2022 than they are now. In general, values have been falling month over month since April’s peak.

We also note that prices do not only go up, that there are many movements up and down over the course of a few years. The first question we should ask is if this is seasonally normal or not. From the graph below, it appears clear that while home values do rise and fall seasonally, this is a larger drop than is typical, and it’s both faster and steeper. Please also see Seasonal Pricing Patterns on this site.

 

Month over month, home prices are dropping in San Jose, CA for single family homes - chart from 2016 to present

This is a lot of sales over the years – 30,691 in all.

If we view this same info in a data table of average sale prices, we can better compare any particular month to the same month in other years. This eliminates the normal seasonal fluctuation.

The peak pricing was April 2022. The average sale price for July 2022 remains above July 2021 and all previous Julys. In 2018 prices got a bump and went down in 2019, but marched upward again after that.

 

Data table - Average sale price in San Jose - SFH all price points

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Ever See a Black Widow Spider? We Do Have Them in San Jose!

A few years back I attended a property inspection in San Jose and we found an unwanted resident in the garage: a black widow spider. Needless to say, did not stick around after she was found!

In case you haven’t seen one, I thought I’d share the pic here (click to see more below). Sadly she wasn’t my last encounter with these spooky locals. In fact, I’ve been seeing all too much of them over the last three years! At least this time, we always found her outside.

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Thousand Oaks Neighborhood

Thousand Oaks neighborhood - corner view

The Thousand Oaks neighborhood in San Jose’s Blossom Valley area is highly sought-after as it is a tidy area, pleasant looking, and very convenient.

Thousand Oaks is bordered to the north by Hillsdale Ave, Pearl Ave to the east, Branham Ln to the south, and Almaden Expy to the west. Most of the area is within the 95136 zip code with a tiny portion in 95118. With great accessibility, tons of amenities, and a moderate price tag, Thousand Oaks is worth a look!

Thousand Oaks Neighborhood Lifestyle

This area offers quick and easy access to major commute routes such as Almaden Expressway, CA-85, and CA-87, as well as extraordinary access to public transit. There are two bus routes, and for only a 20 min walk, 8 min bike ride, or 4 min drive residents can access either of two VTA light rail stations, the Capitol and Branham stations on the blue line. From there you need only travel 2-3 stations to Tamien to reach the CalTrain connection (or skip VTA and drive 10 minutes to the CalTrain Capitol station).

But you don’t need to go far from home to get around. Westfield Oakridge Mall is a 5 minute drive (or 40 minute walk) to the south of Thousand Oaks, and there is plenty of shopping and dining surrounding the neighborhood. The post office is within one mile, along with various neighboring grocery stores, fast food chains, popular local restaurants, and a variety of other stores and businesses.

Still, it’s not all hustle and bustle. The Guadalupe River separates the neighborhood from Almaden Expressway and some of the businesses, parts of it creating a natural tree-filled gulch. Most streets are graced with trees along the sidewalks, enjoy a view of the foothills, and the use of two neighborhood parks: Terrell Park and Thousand Oaks Park. Terrell Park has picnic benches and BBQs as well as a playground, and sits adjacent to Terrell Elementary. Thousand Oaks Park is a ~35 acre community park with ample sports facilities, picnicking and BBQs, playgrounds, a fitness trail, and a community center (there’s even a map of the park amenities). (more…)

Doerr Park of Willow Glen

When locals think of Willow Glen, most will picture the charming historic homes and bustling downtown strip, but this attractive community extends beyond the historic blocks. The Willow Glen Neighborhood Association defines the Central and Historic Willow Glen area apart from the Greater Willow Glen Neighborhood and Planning Area, roughly 10.4 square miles with approximately 82,000 residents. One of the scenic communities of the greater Willow Glen area is Doerr Park.

Doerr Park

Doerr Park Neighborhood of Willow Glen MapDoerr Park, sometimes called Doerr-Steindorf or simply Doerr, is within the 95124 zip code of San Jose, not far from the Cambrian border. The boundaries of this community are Curtner Ave, Meridian Ave, Foxworthy Ave, and Leigh Ave (See it on this Google Map). It is marked by tidy homes and yards with neat green lawns and airy street trees. Towards the center of this highly walkable neighborhood sits a nearly 12 acre city park. Doerr Park is a sunny community park with expansive lawns, open tree groves, picnic benches with barbeque stations, two magnificent playgrounds for different age groups (one of them has 3-tiered climbing towers and long slides for the older children!), a basketball court, softball field, four tennis courts, and restrooms. The park is very popular!

This neighborhood is accessible, too! There’s shopping and an office complex at the corner of Foxworthy Ave and Meridian, with a Grocery Outlet, gas station, and bank. It’s very close to more shopping including restaurants, Target, Home Depot, and more. For commuters, it’s only a 6 minute drive to 85, 17, and Almaden Expy, and there are bus lines which run along Curtner and Leigh.

There are a few possible negatives to consider, however. Some areas are beside easements for high voltage power lines, though a large portion of the easement connecting to the park has recently been transformed into a community trail. Not all phone lines are under ground, which might be considered an eyesore by some.

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