Sam Shueh
Realty One Group
Silicon Valley, CA
It encompasses west part of Santa Clara County with Cupertino schools. The high schools are Monte Vista, Homestead High, Cupertino High, and Fremont Union. The postal zip codes are 94087, 95014 and 95129 covering less than 65,000 residents. These single family homes were mostly built after 1960s. The gross living area is bracketed from 1,300 to 1,999 sf with a minimum 3 to 4 bedrooms and 2 full baths or so. This size range is necessarily to compare similar homes prices in different neighborhoods. There are also in recent years new modern homes constructed by demolishing old homes and they can ask as high as $5,000,000 for a 4,000 sf.
Apple Spaceship is almost completed (Shueh)
We look for trends like YTY price increase, gla/sf.
Total listings SFH = 22 Inventory: 1.0 month (2.5 month is healthy)
unemployment rate=3.1%
Sold/Asked= 105%
Marketing time= 18 days
Avg home(1300-1999 sf)
$1,605K (Jul-Sep 2015) $1,617K (Jul-Sep 2016) +0.7% $973/sf $985/sf +1.1%
During the last 12 months is the lowest price increase since the Great Recession. Apple is moving 15,000 employees into Spaceship campus. While the condos within walking distance has artificially hit $1,000,000 for a 2 bed room, 2 bath with a balcony. The single family homes across near Rancho Riconada neighborhood have maxed out already. A small 2 bedroom 1 bath home on an average lot of 5000+ sf sellers wanted $1,350,000 and got full price on first week. The reason is one can tear it down and build a new home and sell it for $2M+.
Other sources using median home prices without limiting large or smaller size homes also suggest similar trend of no growth to negative price increase since last fall of 2015.
The % accepted vs. listed price shows it is still a seller market. However, good things can not go on forever. We have been having a robust steep price increase since last quarter of 2011 or over 6 years now. This area had the highest home price decline during the early 1990 dot com when the industry was not mature enough. High tech jobs controls home prices. Do they stay here forever is debatable.
I have seen lower number of offers this year than in the past. Investors apparently agree with me and many are cashing out their equity. Many are putting off plans to purchase and prefer to rent or delaying moving up.
The reason is strong economy and low unemployment rate at 3.1% vs 3.6% at the beginning of 2016. The low interest makes sense to own.
Apple in September 2016 has refocused its self-driving car project and has laid off some employees. While Apple will move 7,400 newer employees to the Spaceship campus I expect them to be looking not buying for a long time.
The issues facing many high technology workers is housing affordability. A typical $1.65M modest home like in Cupertino schools districts, one needs to cough up $330K for a 80%-30 year jumbo mortgage which means $8,420 is spent on mortgage (PITI) with a 3.85% jumbo loan. The minimum income to be eligible is $225,000 assuming one does not have major debts.
Many high tech public companies are assessing its profitability and are refrain in new hirees. Yahoo, Qual Comm, Intel, VM ware, and IBM software are re-balancing its work load. Even Apple is adjusting their needs to limited layoff start with HR.
Top employers in Cupertino CA :
1 Apple
2 Seagate
3 Amazon kindle development(lab 126)
It is home for several software, virturalization, comics and wine where grapes were grown throughout the area.
SOURCE:
Cupertino Home prices ( Cupertino Home prices 2016)
Shueh, Sam How is my Silicon Valley home worth? (Silicon Valley Home Values)
Silicon Valley Real Estate July 2016 (San Jose area real estate update)
Shueh, Sam (Real EstateBlogs)
Sam Shueh Realtor
I've called San Francisco South Bay home for over 30 years. We love this area and all it has to offer, and I enjoy sharing what I know about homes. I documented in several books about Silicon Valley history. I have much expertise in real estate...please give me a call. (Four-O-Eight) 425-1601
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