But for people looking for their own freestanding single-family home with a nice backyard and a safe neighborhood, the numbers say there's another opportunity to be had, in Cupertino's neighboring city, Sunnyvale.
From 2000 to 2006, Sunnyvale ranked in the top 25 overall safest cities (out of 315) in America according to the private research firm Morgan Quinto. No other city in Silicon Valley can claim that distinction (though it's also interesting to note that San Jose consistently places in the top 10 safest cities with a population of 500,000 or more.)
The challenge with Sunnyvale is that it doesn't have the hipness factor of Mountain View or the education credentials of Cupertino (even though their school districts overlap in many places).
What it does have, though, is a first in the last decade: a year-over-year price drop that brings Sunnyvale homes in line with the Santa Clara County average. That means no price premium to live in a Silicon Valley city that's consistently rated as one of the safest in America.
It's Hip to Be Square
Truthfully, if you're looking for someplace trendy, Sunnyvale isn't it. That's one reason why it's less expensive than neighboring cities. Sunnyvale's downtown area has the Murphy Avenue row of restaurants, bars and clubs plus the Town & Country Village with its specialty shops --- and there are some good restaurants in downtown Sunnyvale like Dish Dash and Thai Basil.
Given the choice between downtown Mountain View and downtown Sunnyvale, most folks go to Mountain View.
Fortunately, Sunnyvale is only three miles from downtown Mountain View without the skyrocketing prices and tight inventory of that area, so living close to --- but not in --- a trendy area is affordable. (You can find details on the market in downtown Mountain View by reading my Silicon Valley Housing Market Update - April 2007.)
Sunnyvale Townhome and Condo Prices and Premiums Up
Common interest developments in Sunnyvale have traditionally been a good value because you can get a lot of square footage at a reasonable price.
But with a year over year increase in median price from $530,000 to $590,000 in March 2007 (an 11% jump), they don't represent the steal they were last year or in 2003, as evidenced by the higher price premium relative to the Santa Clara County average for townhomes and condos.
That said, they're still tracking pretty close to the overall median and while prices aren't bargain basement, they're not unreasonable for Silicon Valley 2007 standards.
There are a couple low-end ($400-500K range) complexes in Sunnyvale where you can't walk thirty paces without hitting "another" for sale sign so, if you made me promise to guess, I'd say that the median price for condos will dip --- but that doesn't mean there's overall weakness in mid-range and above properties.
The Value Play in Sunnyvale Single-Family Homes
That's a curve we haven't seen in Sunnyvale. The dip below the Santa Clara County median line for single-family homes. In fact, the Sunnyvale price is 2% below that media line this year and the first thing I thought about for my clients was "value play."
The thing about Sunnyvale is that, besides the phase one work on Moffett Towers by Jay Paul Co., the city hasn't gotten any of the buzz from the giant companies located around it in Mountain View (you know who you are) and Cupertino (with HP's mega-complex, Symantec corporate and Apple's current and planned world headquarters campus).
Sunnyvale is literally ten minutes from all of that, and it counts Juniper and Yahoo among its corporate residents.
So for my clients who are tech professionals looking to cut their commute costs (see the bottom of my article Determining Your Must-Haves When Buying a Home) and get a good deal on a single-family home --- today --- I search for houses in Sunnyvale. Sunnyvale has many reasons why it isn't average, and at a -2% premium, now you don't have to pay for them.