San Jose remained the strongest housing market within Northern California’s Bay Area in June, though San Francisco is seeing signs of a rebound after several years in the doldrums.
Single-family home prices in the San Jose metropolitan area, including townhouses and condos, rose 5.6% in June, among the top five of 40 U.S. regions surveyed by Homes.com. Much of Silicon Valley, including affluent suburbs such as Palo Alto, is included in the San Jose area. Employees at technology companies like Nvidia and Google buying homes in these towns and small cities continue to drive sales and price activity for the larger region.
“It’s reflective of the general economic situation, with Silicon Valley still being the base of the tech industry, and with company success trickling down to the people who live there,” said Nigel Hughes, senior director of market analytics for Homes.com and CoStar.
San Francisco saw a much more modest 1.3% price increase in June, but Hughes said recent months have revealed that the market is starting to turn the corner. While prices have been stagnant or declining in the city for some time, he predicted that the boom in artificial intelligence companies will boost prices in the near future.
Doug Goss, Santa Clara County Association of Realtors president, told Homes.com that he sees the same ongoing impact on home prices from the technology sector. Santa Clara includes San Jose and Silicon Valley.
“San Jose’s market is more stable, driven by a strong tech economy and consistent buyer demand, unlike San Francisco or the East Bay, which have seen more volatility,” he said.
The median sales price for single-family houses in Santa Clara County was just over $2 million in June, up 7.2% from a year ago, while the median price for condos and townhouses was $948,000, a decrease of 11.9%, according to the association. Sales were also more robust for single-family homes, with 830 sold in June, up 2% from a year ago, compared to 304 condos and townhouses, down 11%.
Santa Clara had just 1.8 months of unsold inventory in June, according to the California Association of Realtors, an indication of a very tight housing market.
“You think of the big tech companies like Nvidia, people who work there want to live nearby,” Hughes said. “Also, the return-to-work mandates have picked up in San Jose in the past 18 months. They’re competing for a limited number of homes, outbidding each other and spending a lot of money.”
