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A Home Buyer’s Guide to San Jose, California in Silicon Valley

This article is part of a series that explores the San Francisco Bay Area region from a home buying perspective. Here, we turn our attention to the city of San Jose, California located in the tech mecca of Silicon Valley.

San Jose, California at a Glance

Situated in the southern part of the San Francisco Bay Area, San Jose is approximately 50 miles southeast of San Francisco and 55 miles northwest of Monterey. It’s located in the heart of the Silicon Valley region, home to some of the world’s leading tech companies.

Closeup map of San Jose, California

San Jose is relatively flat with some rolling hills in the eastern and southern parts of the city. It’s surrounded by several mountain ranges, including the Santa Cruz Mountains to the west and the Diablo Range to the east.

The city is traversed by the Guadalupe River, which flows from the Santa Cruz Mountains through the heart of downtown San Jose before emptying into the San Francisco Bay.

Major cities that surround San Jose include:

  • Santa Clara: Located to the northwest, Santa Clara is home to Levi’s Stadium, the home venue of the San Francisco 49ers.
  • Cupertino: To the west of San Jose, Cupertino is known for being the headquarters of Apple Inc. and for its affluent residential neighborhoods.
  • Milpitas: Situated to the north, Milpitas is known for its diverse community and thriving technology industry.
  • Los Gatos: Located to the southwest, Los Gatos is a picturesque town known for its historic downtown area and upscale neighborhoods.

San Jose has a Mediterranean climate with mild, wet winters and warm, dry summers. The city enjoys plenty of sunshine throughout the year, allowing for a variety of outdoor activities.

Local Economy and Major Employers

Known as the “Capital of Silicon Valley,” San Jose is a hub for technology and innovation. It is home to numerous tech companies, including Adobe, Cisco, eBay, PayPal and Zoom.

Major government and educational-based employers include the local city government, Santa Clara County, and San Jose State University.

As of last year, the top ten employers in the city of San Jose included:

  1. County of Santa Clara (18,700 employees)
  2. City of San Jose (7,627)
  3. Cisco Systems (7,500)
  4. PayPal (3,868)
  5. San Jose State University (3,650)
  6. Adobe Systems, Inc. (3,400)
  7. Kaiser Permanente (3,035)
  8. eBay (2,800)
  9. Western Digital (2,759)
  10. San Jose Unified School District (2,679)

Housing Market Overview: Pricey and Competitive

The real estate market in San Jose California can be summed up with a single sentence. It’s expensive, it’s competitive, and there aren’t enough homes on the market to meet the demand from buyers.

If you already live in the San Jose area and are planning to buy a home there, you probably already understand this dynamic. But it can be a shock to those who are relocating from other parts of California or the United States.

Home buyers who enter the San Jose housing market should be prepared for the real estate equivalent of a foot race.

A snapshot of median home values as of May 2024:

  • City of San Jose: $1,461,923
  • San Jose-Sunnyvale-Santa Clara metro: $1,614,185
  • State of California: $783,666
  • United Sates median price: $354,179

These figures will have changed by the time you read this. But they still show a key point home buyers need to know about. House values in San Jose are nearly twice the statewide median for California, and more than $1 million higher than the national median price.

According to some recent estimates, the city of San Jose currently has the most expensive housing market in the United States and the fifth most expensive in the world.

When this article was published, the San Jose real estate market had about a one-month supply of homes for sale. This indicates a tight seller’s market with very low inventory compared to statewide and national averages.

Because of this supply-and-demand imbalance, homes tend to sell very quickly in San Jose and often for more than the original list price. Home buyers should bear this in mind when shopping for a property, making an offer, and negotiating with sellers.

Popular Neighborhoods in San Jose

We conclude this guide with a list of popular neighborhoods within the city of San Jose, California. If you’re thinking about buying a home in the area, be sure to put these on your short list for additional research.

The Alameda: Historic district with Victorian-era homes, tree-lined streets, and a charming main street. Primarily single-family homes, popular with families seeking a walkable, historic neighborhood.

Almaden Valley: Tranquil neighborhood in the southwest corner, known for its rolling hills, vineyards, and top-rated schools. Primarily single-family homes, popular with families seeking a quiet, upscale environment.

Berryessa: Well-established neighborhood in north San Jose, known for its convenient location and suburban feel. Also known to have good parks and schools.

Blossom Valley: Family-oriented neighborhood with parks, schools, and a suburban feel. Offers a mix of housing options, from townhomes to single-family homes.

Japantown: Rich cultural heritage with Japanese restaurants, shops, and historical sites. Primarily low-rise apartments and condos, attractive to young professionals and those seeking a lively, multicultural community.

Rose Garden: Named for the beautiful Municipal Rose Garden, this neighborhood offers a mix of Spanish-style homes, condos, and apartments. Popular with bikers and those seeking a blend of green space and urban convenience.

Silver Creek: Affluent bedroom community in the Evergreen District, bordering the Diablo Range foothills. Known for its top-tier amenities and upscale real estate.

West San Jose: Affluent area known for spacious homes, high-end shopping (Santana Row, Valley Fair Mall), and excellent schools. Popular with families seeking a suburban feel close to amenities.

Willow Glen: Family-friendly neighborhood with tree-lined streets, charming bungalows, and excellent schools. Offers a mix of housing options with a strong sense of community.

Bridgepoint Funding serves borrowers all across the Bay Area region as well as Silicon Valley. We offer a variety of mortgage options, including jumbo loans that are well-suited to expensive housing markets like San Jose.

Mike Trejo is a Bay Area mortgage broker with 20+ years of knowledge and experience.

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