The San Jose real estate market continues to be a deepening seller’s market with no signs of letting up.
First, some quick data from my RE Report via the bullets and chart below. There appears to be a small amount of undercounting or overcounting between the RE Report and MLS Listings, but the information is still good for tracking trends.
- The May 2022 sale price to list price ratio for San Jose single family homes slipped again to 113.0% of asking (-3.1% from last month), but remains up from a year ago when was 111.2% (+1.6% from then)
- Home prices are up roughly 17-19% from a year ago (almost a typical 20% down payment!)
- The median sale price is $1,742,500 (a dip from the prior two months, but way up from a year ago, when it was $1,470,000 (+18.5%)
- The average sale price was $1,864,960 (-3.2% from last month, and +17.6% from May 2021)
- The days on market slowed a hair to 11 (same as in May 2021).
War, inflation, stock market, recession concerns – and real estate
Many of our home buyers are financially powered by tech stocks, stock options, and RSUs. When the stock market tanks, some buyers will rush to put their cash into real estate (the quip we often hear is that “real estate does not go to zero” and “at least you can live in it”. At the same time, if the most amply capable buyers don’t want to sell their holdings at a 10% or more discount, that will impact how much they are willing to pay.
For some, the rising interest rates combined with the lower stock values have been a double whammy on affordability in a market still seeing historically high prices.
We are seeing slight signs of cooling in the market with fewer offers and some data points just a hint calmer than a month ago. Prices are not climbing like they were earlier this year, but they’re not falling either and interest rates are rising.
Nationwide, inventory is rising pretty noticeably, and we’re starting to see some growth around Silicon Valley, too. So are we getting back to normal inventory? Let’s have a look at what has historic inventory has looked like in San Jose. (If the chart is too small, click to see in full size.)
At the start of the chart, 2010, the market was still reeling from the 2008 recession, but by 2017 we were seeing a strong sellers market with record low inventory. While listings are certainly up from 2021’s rock-bottom lows, it’s still extremely limited and nowhere near the inventory of more balanced years like 2013 and 2014.
So while inventory has been growing, there is still a shortage. If it continues to grow, prices should level out or drop. But will it be on par with interest rates rising? No one knows.
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 Glance
|No. of Sales
|Sale vs. List Price
|Days on Market
|Days of Inventory
Year over year and related charts from MLS Listings
I pulled these directly from the MLS myself today (6/8/2022). The limited data from this month is included in red, but as it is an incomplete picture with data based only on home sales that closed between June 1th – June 8th it should be taken with a grain of salt. As with the earlier chart, click to view the full size.
The San Jose Real estate market’s sale price to list price ratio – notice the huge jump from last year, and then notice the ongoing streak of record breaking highs!
San Jose sale price to list price ratio – click to view larger
Notice that MOST YEARS, but not always, the sale price to list price ratio tends to peak around April with a rise between March and April and a dip from April to May. It fell a little in 2020, but that did not turn into the correction we all anticipated at the start of COVID. Look into late 2020 and you’ll see that all we were actually experiencing was a slight breather – very slight.
Now looking at the most recent numbers, winter 2022 started off raging hot and spring hit it’s peak for overbids in March and began to decline in April. While the sales to list price ratio is slipping, it’s still higher than any past year.
Please keep reading below.
Are home prices dropping in San Jose CA and nearby? Is the Silicon Valley real estate market seeing price reductions? San Jose is a large, sprawling city with about 1 million residents, so checking the San Jose real estate market a good marker for how the region is doing as a whole.
About the price drops, the quick answer is yes and no. Month over month, it’s true that home prices have inched down slightly. But year over year, they are still up significantly. The year over year part is more significant, because many years, maybe most, prices pull back a little from May to June and June to July. In other words, it is seasonally typical for prices to fall a little during this time of the year.
Are home prices dropping in San Jose CA? What does the data say?
Here’s a look at the average sale prices in S.J. from 2004 to the present for single family homes. The month of July is highlighted in yellow, generally. Most years are the darker yellow, but the “off” years where prices are a lower are in a paler yellow.
This same data may be better understood visually by some readers, so here’s a graph of the average home price in San Jose, CA, from 2004 to the present.
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.
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…)
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, 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.
It can be really challenging for people moving to Silicon Valley to get a sense of real estate prices, and perhaps more, comparing cost of from one town or district to another.
One question I get a lot is this: what does it cost to buy a 4 bedroom, 2 bath house of about 2000 square feet?
So to answer this question, let’s see what houses like this are selling for (4 bed, 2 bath, appx 2000 SF or 185 square meters) and see how the cost looks in one Santa Clara County / Silicon Valley area versus another.
Today I compared several areas and cities using this criteria: single family homes of 1800 – 2200 SF, 3-5 bedrooms, 2-3 bathrooms, on lot sizes of 6000 SF to 10,000 SF. Normally I would chart this over the last 2 months, or 60 days, but because of the low inventory causing the sellers market I have expanded the search to the last 3 months, or 90 days, for a better range. Because some areas have had a scarcity of inventory, I’ve added an addition to the chart titled NoS for Number of Sales within the given range.
Here’s how it shakes out in the “west valley areas” along the Highway 85 corridor, most of which are known to have good to great public schools. What areas are most affordable? One way of analyzing this is the “price per square foot” figure. Whenever I update the chart, I re-arrange the order of the cities from high to low based on the price per square foot, although there’s usually minimal movement.
Within this range, Campbell only had one sale over the last 90 days, so data for that segment may or may not be a good average. Both Los Altos and Saratoga had no sales within the last 90 days within these criteria, so their searches have been expanded to 0-180 days (or 6 months / half a year) and 0-120 days (or 4 months / a quarter year) respectively to provide data for comparison for this chart. Now that we have the data, let’s analyze it!
The market in early 2019 began heating up in a seasonally normal pattern but has now leveled off with a little up, a little down, but not too far from 20 days to sell. Prices are similarly a bit up and down but overall seeming to level out.
Today I want for us to take a quick look at the seasonal patterns for days to sell which tend to be present for houses selling in the city of San Jose over the course of a year. Please note that the pattern can be similar – but the depth or severity of the pattern can vary quite dramatically year to year, or between one location or price point and another.
I really like taking a multi-year view (which almost no one seems to do, it is nearly always only year over year) to get a broader sense of what is normal – or at least what appears to be a regular pattern.
In the graph below, you’ll see that most years see inventory rising in January or February. We had a highly overheated pattern in all of 2017 and early 2018, and visually it’s pretty evident that they were moving to a beat of a different drummer.
Graph – San Jose average days to sell a single family home
Now let’s look at the actual numbers as of today, June 12, 2019. This number may be different when June is completed, but right now we have 23 days to sell on average. That is longer than 2014-2018, but shorter than 2013 (which was a good year).
Compared to 2015 to 2018, San Jose’s current average days to sell of 23 seems quite high. Go back a little more to 2013 and 2014, though, and it’s not outrageous at all. Or Google what the “average days to sell” is like in most of the U.S. and you’ll find that this is not a high number at all.
Is it harder to sell a house in San Jose now than a year or two ago? Yes, absolutely! Is it a buyer’s market? No! It is becoming more balanced, though. I would call this a healthy market. Perhaps a normalizing market. Homes which are priced well, marketed well, easy enough to see and so on are selling in well under a month. That’s a good market. For a little perspective, check out the June numbers from 2002 through 2012 (the MLS won’t let me get stats further back that 2002).
San Jose days to sell a single family home 2002-2012
Altos charts for single family homes (houses and duet homes) in San Jose CA
Using the Altos Charts (I have a subscription), here’s a view of 4 pricing tiers within San Jose residential real estate which is for sale – not sold – right now. Days to sell charts the success stories, the ones that go under contract! This info charts ALL LISTINGS which are active or as yet unsold.
Have a look:
A normal market is not a bad one. Buyers are less rushed, Sellers who are reasonably aggressive on price, condition, marketing, access, etc. are having success. Overpriced homes, homes with too many issues or which are too hard to see are a different story.
Interested in buying or selling a home in San Jose? Please reach out to me!
In west San Jose with the 95129 zip code, near the borders of Saratoga, Cupertino, and Campbell, you’ll find the much beloved Happy Valley neighborhood. The nearby school, which is highly regarded, is Country Lane Elementary, so the area is also known as the Country Lane neighborhood. This is a quiet pocket of understated but very comfortable ranch style homes on lovely tree lined streets.
I have a lovely listing in this neighborhood at 4843 Englewood Dr, San Jose, CA 95129 – please click on the link and check out all the details and photos!
Where is the Country Lane or Happy Valley neighborhood?
The Country Lane or Happy Valley neighborhood is bordered by Doyle Road, Saratoga Avenue, Prospect Road, and Lawrence Expressway. It is almost shaped like a triangle – but not quite. At the southern tip of the area is a commercial complex with a number of shops, restaurants, a hardware store, and much more. Just across Saratoga Avenue from there is Westgate, and “kitty corner” is El Paseo de Saratoga (with movie theaters as well as stores and restaurants). Prospect has more shops, including a See’s Candies, a car wash, eateries, you name it.
How is the commute from this part of West San Jose? What’s nearby?
Depending on where you live in the Country Lane or Happy Valley community, it is about 1.5 miles to either Highway 280 or Highway 85, but you may find that you can commute via Saratoga Avenue, Lawrence Expressway, or San Tomas Expressway. Look at the map, below, to notice how very convenient this location is!
From this area, it may be a comfortable stroll or bike ride to a number of shops and eateries. (more…)
The historic Naglee Park Home Tour in San Jose will take place on Saturday April 21, 2018 from 10am to 4pm. Sponsored by the San Jose Woman’s Club, this is the seventh year of the annual tour. This year, proceeds go towards the renovation of the Women’s Club 1929 Spanish Revival Clubhouse.
Tours include access to seven homes along two adjacent blocks in Naglee Park, and shows off both their lovely living quarters and gardens. Visitors have the option of pre-ordering a lunch box, and wine and refreshments will be available at the Refreshment Garden. The tour also features a lecture and open-air market.
The SJWC does not have any information on their website as of yet, however the Eventbrite page, where you can purchase tickets, has details, as does the Facebook Event Page.
For tickets and information: https://www.eventbrite.com/e/sjwc-naglee-park-vintage-home-tour-tickets-42695715033
Historic Naglee Park Home Tour in San Jose was on the same date, April 21, back in 2012 for the 3rd annual tour.
Close to the Los Gatos border sits one of the more affordable Cambrian neighborhoods in San Jose and the west valley generally. It enjoys lovely views of the hills, great public schools with high API scores, a neighborhood private school to boot, and convenient access to freeways and stores. There’s no sign, marker or gateway to the area, so many of its residents are probably unaware that the official name to it is Cambrian Gardens.
This neighborhood provides an incredible “bang for the buck” for home buyers wanting excellent schools and not wanting to pay luxury home pricing. In many ways, it’s a “sleeper” – meaning that many people don’t know it’s there, but it’s a good deal!
Where is the Cambrian Gardens area of Cambrian?
The rough borders are Union Avenue, Los Gatos-Almaden Road, Leigh Avenue, and the West Valley Freeway (85).
Not everything within that area is part of the tracts which make up Cambrian Gardens, though. It was developed just south of and directly adjacent to the Cambrian Park area which is so well known, but now separated from it by the freeway. (Click image or here to see live map in Google.)
Cambrian Garden Landmarks
Homes built in this part of Silicon Valley were clustered around the later-built neighborhood public school (bordered by Clarinda, Laurinda, Emeline and Sandy), James De Voss, which is now leased out as a private one, the Global School, as well as Little Oak Preschool. The other major landmark to the neighborhood is Ross Creek, which slides through the middle. With it come frogs, egrets, ducks and other wildlife which are generally welcome. (more…)