Silicon Valley offers a proliferation of high end cities, towns and neighborhoods with remarkable luxury properties and estate homes. These are not just homes with large price tags, but rather real estate with superior qualities and amenities not seen in regular homes. While in much of the U.S. a million dollars will buy a home worthy of the word “estate”, that is not the case in Santa Clara County, San Mateo County, or anywhere in Silicon Valley.

Where are the high end homes found?

Although there are some small pockets of impressive luxury properties outside of this list, a good starting point includes these communities or parts of them: San Jose’s Almaden Valley, southern Evergreen area of San Jose’s east foothills, the hilly areas over Milpitas and Fremont, Los Gatos and the Los Gatos Mountains, Monte Sereno, Saratoga, western or hilly areas of Cupertino, Los Altos Hills and Los Altos, Palo Alto, Menlo Park, Woodside, Hillsborough, Portola Valley, and some other hilly areas of the inland Peninsula. (A lovely pocket in central San Jose is University Avenue in the Rosegarden area too.)

This is one of the softest parts of the Silicon Valley real estate market as of late  2016 – many home buyers who can afford a large, luxury  property do not want to over-invest in their personal residence, so are scaling back. For the home buyer looking to purchase a large home on a large lot, this is a great time to make an offer, as there is less competition than usual in the luxury or estate tier of real estate in Silicon Valley.

When is an expensive property an estate or luxury home?

Most often, the luxury market begins somewhere in the range of $3,000,000 to $5,000,000 and goes up from there. (The most expensive estate sold in Silicon Valley took place a couple of years ago for about $100 million.) A three million dollar house in Morgan Hill, Almaden Valley, Los Gatos or southern Evergreen will be considerably more impressive than one with that same price tag in Woodside, Hillsborough, or Palo Alto. As always, then, the location has a tremendous bearing on the price tag and the designation as a luxury home, and as with lower end properties, the #1 factor remains location. (more…)

Many nation-wide websites would have you believe that you can understand the Silicon Valley real estate market by simply plotting trends by city, zip code, or by tracking sales activity within 1 mile of any given property.  While this qualifies as a popular and an easy answer, it’s not a very good one and usually provides far from accurate results. The reason for this is that we don’t have just one real estate market, but many micro markets instead.

Silicon Valley is a large region.  It covers all of Santa Clara County, most of San Mateo County, and parts of Alameda and Santa Cruz Counties.  Within each county there are vast differences, of course, but sometimes those vast differences occur even within one zip code or smaller area. Sometimes even within one block!  I sold a Monte Sereno home that had Campbell schools, while directly across the same street there was a house within the Los Gatos school system. Those are different markets.

Age and type of construction

Adobe ranch house in Santa Clara CA – named the Santa Clara Woman’s Club

For example, the photo to the right is of a historic ranch style home made of adobe in the city of Santa Clara.  One micro market may simply be “Historic homes in Santa Clara”.  But another could be “Adobe houses in Santa Clara County” – since there are only a handful of them in our area, there won’t be enough old adobe ranch houses to compare just within that city.  But what you would not do is compare this house to one on the same block which is a 1965 ranch style home made of wood.  It’s only a little bit helpful that they are close together in location. The probable buyer for either house is most likely to be quite different from one to the next.  Historic and adobe homes are both micro markets.

School districts, zip codes, and city boundary lines

Perplexing to many newcomers is the odd way that our school districts relate to zip code and city boundaries.  Schools are very often – but not always – a major driver in home values.  If you want to buy a home in Los Gatos, you could find yourself in the Union School District, the Campbell School District, the Los Gatos Union School District – and that is only in zip codes 95030 and 95032!  Should you buy in the Los Gatos Mountains, which have a Los Gatos mailing address, you’d be in the Lakeside Union School District or possibly the Loma Prieta School District, unless you are very “close in” and still in the Los Gatos Union School District.   (Many people moving here expect all homes in Los Gatos to have “Los Gatos Schools”.)    Sometimes, most of one school district covers one zip code, but a sliver or smaller area may have a different district.  That’s a micro market and is important to factor that in.

Equally unhelpful can be the way that zip codes are drawn.  The95138 zip code is partially in South San Jose / Santa Teresa in a very flat area and partially in a valley of the Evergreen foothills near Silver Creek Valley, where homes have a far higher price tag.  Sometimes “the market” is truly only part of a zip code, or a combination of a few.  Members of the multiple listing service can search the map by areas we draw onto it – carefully excluding some pockets and including others. It’s time consuming but infinitely more accurate. (more…)