Santa Clara County is the second most expensive county in the nation to buy a home, yet demand is still strong.
The county’s No. 2 ranking helps secure the Bay Area as the most expensive metro area in the U.S. for the eighth consecutive year, according to PropertyShark, a blog covering real estate trends. Its latest report analyzes the 100 most expensive ZIP codes in America by median home sales price from the beginning of the year through Oct. 20. Santa Clara County leads the Bay Area with 16 ZIP codes in the top 100. Los Angeles County tops the nation overall with 20 ZIP codes.
In Santa Clara County, the top five most expensive ZIP codes are Los Altos ranking in 12th and 13th place, Saratoga at 16th, Palo Alto at 19th and Los Gatos at 23rd — all with median sale prices of more than $3 million. East Los Altos tops the county with a $4 million median home sale price, according to PropertyShark.
Holly Barr, a Willow Glen real estate agent, told San José Spotlight these locations have excellent schools and custom homes on larger lots, but the reasons for the high cost of luxury living is the same as buying a designer handbag.
“Why are Louis Vuitton or Chanel bags so expensive?” Barr said. “It’s because we decided they were. We all agreed that’s an expensive bag or area and it has always been that way.”
The first time a San Jose ZIP code appears on the list is No. 77 — 95120, which includes Almaden Valley. The median home sale price in this area is more than $2 million, and Barr said good schools and large home lots complement the sale prices. The only other area in San Jose cracking PropertyShark’s top 100 is West San Jose at No. 83, which includes Santana Row at a $2 million median home sale price.
‘Par for the course’
Will Chea, president of the Santa Clara County Association of Realtors — a trade association representing more than 6,000 real estate professionals in Santa Clara County — told San José Spotlight PropertyShark’s findings are “par for the course.” The tried and true areas are still seeing multiple offers, whereas less desirable areas may be seeing price reductions as sellers’ expectations subside over the “nuclear market” experienced during the COVID-19 pandemic.
“During the pandemic … you could whisper, ‘I’ve got a listing’ and you’ve got six offers ready. That was nuclear, there were no negotiations,” Chea said. “Going from the insane numbers that we had, people think that the market is really starting to suffer. It isn’t, sellers are for the most part still getting the numbers that they want.”
Fears of a market crash are short sighted, Chea said. South Bay homeowners are sitting on 40 percent to 60 percent equity in their homes and are not at risk of foreclosure, he said.
Chea hopes to see interest rates go down. High interest rates coupled with “insanely low” inventory is affecting affordability in the region, he said.
“Absolutely it is (still) a good time to buy,” Chea told San José Spotlight. “Are you going to see a 2 percent (interest rate)? That was probably a once in a generation event … We’ll be back to 5 percent, which is still phenomenal.”
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This story orginally appeared in San José Spotlight.