The Ultimate Guide to Silicon Valley's Housing Market

Has the nickname “Valley of Heart’s Delight” been hitting too close to home lately? How about you stop daydreaming and actually make the move; we’ll help, don’t you worry.

If you’re one for luxury and geeking out at electronics stores, Silicon Valley is the land for you—a place that often feels different from most parts of the Golden State. In Silicon Valley, it’s not atypical for people to live to work, accept payment via bitcoin, order a car that hasn't been designed yet, or pay $10,000 to mix with the cool kids at a TED Conference. If this is where your dream home resides, you better start getting creative—Silicon Valley’s housing market is in high demand. There are ways to hack it though, but to find out more, you have to keep reading.

Overview of Silicon Valley’s Real Estate Market

The pandemic created a unique climate in Silicon Valley's real estate market, but with the relaxing of restrictions in the San Francisco Bay Area, buyer demand witnessed a significant surge. Home prices flew and bidding wars began, particularly in the shiniest and richest neighborhoods.

Industry experts predict a strong quarter for Silicon Valley's residential real estate specifically. The demand to upgrade to a larger property was brought on by the pandemic, as most people preferred to stay at home. This desire for suburban bliss has seen a resurgence in most of the country, and Silicon Valley is by no means an exception.

Silicon Valley’s Average House Price

Notoriously high home prices are sort of the norm in San Jose as well as in the rest of Silicon Valley. This doesn’t stop people from buying though. In the current hot housing market, Silicon Valley houses are getting snatched left and right. And as soon as those homes enter the market, the offers flood—this has historically been rare for San Jose.

If you're an average home buyer in the San Jose Metro area, then you're going to want to plan on making at least $255,836 in order to buy a house in this area. The average Silicon Valley property prices loom around $1.25 million—add the monthly payments of $5,946 for a 30-year fixed-rate mortgage to that and you'll get the approximate picture of the salary needed.

Being the epicenter of major tech conglomerates, Silicon Valley has a natural influx of young professionals looking to be the next Steve Jobs. So if you decide to live in Silicon Valley, you’re going to have plenty of techy millennial neighbors. And while the pandemic switched things up a bit with more people leaving Silicon Valley as well as Los Angeles for cheaper, less populated areas, San Jose specifically has remained in high demand.

Everything You Need to Know About Silicon Valley’s Rental Market 

In cities like Mountain View, you'll find that the majority of residents are renters. While still reserved for those willing to pay on the higher end, the Silicon Valley homes that are up for rent come in a wide array—you’ll find anything from a studio to a luxury abode.

As far as the median renting value for Silicon Valley houses go, you'll be able to rent a studio/one bedroom for roughly $2,300 per month, a two-bedroom for $2,900, a three-bedroom for $3,950, and a four-bedroom for $5,200 a month.

Usually, the process of being approved will include a landlord asking you to prove an income that is triple the annual rent. So if you're looking for a two-bedroom that’s going to cost $36,000 annually, for example, you'll need to prove an income of at least $108,000.

Another thing unique to Silicon Valley’s rental market is the fact that most of your conversations, deliberations, and negotiations are going to be held directly with your landlord—real estate agents don’t tend to get involved here. The biggest property managers around are Irvine Company, Essex Property Trust, and Prometheus; they operate large apartment communities, many with their own fitness centers and pools.

When to Start Searching?

While you might be justifiably excited to live in Silicon Valley, don't start your apartment hunt more than 30 days before you need a place; people might snatch a good deal as soon as they see one. Leases generally start on the first and the 15th of the month, meaning you have to plan for one of those move-in days and subtract 30 to know when your lease begins. As soon as you find a place you like, go ahead and contact the property manager or the landlord to schedule a viewing—don’t forget to ask all the important questions.

Location, Location, Location

An open secret when it comes to Silicon Valley real estate is that you should never get an apartment—rent or buy—that’s close to a major road, or worse yet, the train tracks. Trains pass by at all hours of the night; you might not be able to get any sleep. So no matter how nocturnal you get when you’re binging your favorite TV show, it’s best to avoid these areas when renting in Silicon Valley.

Make a Move, Fast

If you have your heart set on a place or if you just simply really like it, be ready to submit all of your paperwork and a deposit on the spot. Many make the mistake of touring too many places and taking too long with their decision, only to find that the home they originally liked has been snatched already. While landlords have a little bit of latitude, state law requires them to accept the first qualified applicant—the term “qualified” is where they can slant things to favor someone who applied on the spot.

As we mentioned, there are documents you can have ready with you to make your landlord like you more. These include an application form (provided by the property manager or the landlord), proof of identification and employment, letters of recommendations that state what a great tenant you have been in the past, as well as a checkbook ready to put a deposit down.