Santa Clara County Housing Market: One of the Most Competitive in the U.S.

Published:
June 6, 2024
Last updated:
June 12, 2024
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By some measurements, Santa Clara County in California is one of the most competitive real estate markets in the U.S. for home buyers.

Some buyers (including many who relocate from overseas) submit offers sight-unseen, just to get ahead of other home buyers. Hot properties often go under contract within days of hitting the Santa Clara County housing market and frequently sell for more than the original list price.

And when it comes to prices, most people outside of California would be shocked to learn that the median home price in Santa Clara County is nearly $2 million.

This article explains some of the factors that make the Santa Clara County housing market one of the most competitive in the country. We’ve also collected several helpful Santa Clara County home buying tips to help you succeed.

Santa Clara County Overview

Santa Clara County is located in the southern San Francisco Bay Area region of California. It’s the sixth-most populous county in California and a major economic and technological hub. (Santa Clara County and “Silicon Valley” are basically synonymous.)

As of the last census, the county had a population of more than 1.9 million residents. It’s known for its ethnic and cultural diversity, with significant Asian and Hispanic communities calling the area home.

Major cities in Santa Clara County include:

  • San Jose: The capital of Silicon Valley and the largest city in the county. San Jose is known for its diverse population, tech industry, and cultural attractions like “The Tech Interactive” science center and museum.
  • Sunnyvale: A major tech hub and home to companies like LinkedIn and Yahoo. Sunnyvale offers well-maintained parks, a historic downtown area, and a mix of residential areas and commercial centers.
  • Santa Clara: Known as “The Mission City” due to its historic Spanish mission, this city is home to Santa Clara University, Intel headquarters, and Levi’s Stadium (home field of the San Francisco 49ers).
  • Mountain View: Home to Google’s headquarters, this city offers a mix of residential neighborhoods, tech offices, and natural beauty at Shoreline Lake.
  • Cupertino: Home to Apple Park, the headquarters of Apple Inc. Cupertino is an affluent city known for its excellent schools, upscale neighborhoods, and proximity to major tech companies.
  • Palo Alto: The hub of Silicon Valley venture capitalism. Palo Alto is home to Stanford University and numerous startups. This city is a mix of academia and technological research, with a bustling downtown area and tree-lined streets in the suburbs.
  • Los Altos: A wealthy enclave known for its upscale neighborhoods, top-rated schools, and quaint downtown with boutique shops and gourmet restaurants.

Real Estate in Santa Clara Market Overview

The Santa Clara County and Silicon Valley housing market can be summed up in two sentences:

There are a lot of high-salary tech workers seeking homes in the area, but not nearly enough homes available to meet that demand. This imbalance fuels fierce competition among buyers, resulting in some of the highest home prices of any U.S. county.

Some other things to know about the local real estate scene:

  • It’s fast. Out of all 58 California counties, Santa Clara usually has the highest percentage of homes that sell within two weeks.
  • It’s competitive. Santa Clara County also has one of the highest sale-to-list-price ratios in California, which means a lot of homes end up selling for more than the original asking price.
  • It’s expensive. Depending on the source, the median home price in the area was somewhere between $1.7 million and $2 million as of spring 2024.
  • It’s tight. According to the California Association of Realtors, Santa Clara County had about a 1.5-month supply of homes for sale last month. That was below the statewide inventory level and well below the national average.

Why Is It So Competitive?

There’s not just one factor driving competition among home buyers in Santa Clara County. As usual, it’s a perfect storm of Santa Clara County housing trends and conditions.

For one thing, Silicon Valley is home to a lot of major tech companies and startups. This attracts highly trained professionals from all over the world, and these folks have a lot of purchasing power.

According to the U.S. Census Bureau, the median income for Santa Clara is currently above $150,000. So there are plenty of people with the funds needed to make a home purchase. This creates strong demand for housing, driving up Silicon Valley home prices and competition.

On the supply side, the entire Silicon Valley region faces building constraints due to geographical limitations and restrictive zoning laws. This limited supply cannot keep pace with the growing demand, further fueling competition.

Add in some strong demand from foreign buyers (particularly from China and India) and you have all the ingredients for a highly competitive Santa Clara County property market. And that’s Santa Clara in a nutshell.

Advice for Silicon Valley Home Buyers

Given all of these statistics and trends, you might think it’s nearly impossible to find and purchase a home in Santa Clara County.

But that’s obviously not the case.

According to the Santa Clara County Association of Realtors, there were nearly 1,500 home sales during the first quarter of 2024, with another 674 sales in the condo / townhome category. So clearly some buyers are having success.

Here are some things you can do to increase your own chance for success:

  • Make sure you have your financing arranged ahead of time. If you’re using a mortgage loan, this means getting pre-approved by a mortgage lender before you start house hunting.
  • Be prepared for bidding wars. Multiple-offer scenarios are a common feature of the Silicon Valley real estate market, and they require a unique set of negotiating skills.
  • Make a strong initial offer. This is not the kind of real estate market where you would “low-ball” the seller or nitpick over contract contingencies.
  • Work with an experienced real estate agent. You’ve heard this one before, but it bears repeating. Having expert guidance is a must in a highly competitive real estate market like Santa Clara.

The Santa Clara County housing market is certainly was of the hottest in California, and in the country. Given this, it’s important for home buyer hopefuls to ensure their finances are in order and to team up with experienced industry professionals to facilitate a successful transaction.

Need financing?

If you’re considering buying a home in Silicon Valley, we’re here to help. Reach out to Sammamish Mortgage to get pre-approved for a mortgage and get real-time rate quotes to get on the road to homeownership today!

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