How to Buy a House in San Jose: Everything You Need to Know

Built on decades of experience and supported mountains of facts, this guide will help you edge out the competition. It’s everything you need to know to buy a home in San Jose: where to shop, when to shop, and how to make the best offer in the right neighborhood.

Let’s take a ride down Woz Way. Open the windows wide, turn up the Warriors game on KGMZ, and let’s get local on what it takes to buy a house in San Jose.

What’s ‘average’ in San Jose? Residents and homes

Many of San Jose’s one million residents spend their 9-to-5’s grinding away at one of the area’s major tech hubs (with a generous bumper on either end to account for the Bay Area’s infamous traffic), so it’s easy to forget that there’s more to San Jose than young techies in Teslas. In fact, the largest percentage of residents are between the ages of 65 and 74.

Like the rest of the Bay Area, San Jose is experiencing a massive influx of people from all over the world. Another way to say this: there’s a housing shortage, and the market is extremely competitive. New homes aren’t being built because there is a greenbelt around the city, restricting new construction. Most of the available homes are single-story ranch-style homes built in the 1950s, and luckily for buyers ready to move, almost everything is market-ready.

According to San Jose real estate agent Sandy Jamison, who’s closed 676 transactions in the area, most buyers don’t want a fixer-upper. “They don’t want problems. They don’t want to have to go to a renovation. They actually want to have it already done, ready to go, with very few problems so they could just move in and start living.”

A close look

Thanks to the mild, dry climate (San Jose’s average annual rainfall is 17 inches, about half the national average of which is 38 inches), buyers don’t have to worry much about the problems that plague homes in areas with extreme weather, but you’ll still need a thorough home inspection. One of San Jose’s most well-known home inspectors, Larry Tringali of Property Inspection Service, says potential buyers should screen inspection service providers by asking this simple question: “How many inspections do you do every day?” His advice is to pass on any company that reports doing more than four.

Wait, no basement?

People are surprised that most California homes don’t have basements. Here’s the scoop (pun intended): Home builders dig a deep foundation (which results in a basement — bonus!) only when they need to keep the water pipes below the frost line. So, no frost equals no basement. Attics are fairly common, though, so you’ll still have a place to store your boxes and boxes of college notebooks because…you know. You might need them one day.

Rolling blackout-proof homes

One surprising selling point in San Jose is natural gas. Due to equipment failure causing frequent wildfires, California’s electric utility must turn off power for large swaths of the population on a semi-regular basis, but natural gas lines are not affected. Gas water heaters, gas heat, and gas ranges and stoves have never been more popular! Unfortunately, nobody has figured out how to charge their Tesla with natural gas (yet!) but if this innovation is going to happen anywhere, it’ll happen in San Jose first.

Sticker shock

Yes, it is really expensive to buy a home in San Jose. But if you’re reading this, chances are pretty good you’re aware of the cost, and although San Jose is one of the most expensive places to buy a home in the U.S., the average annual salary hovers around $100,000, which makes this homebuying equation possible for many. But just how far can you stretch a dollar in San Jose?

Unlike other parts of the country, where Craigslist may be seen as a gray market for shady deals, in the Bay Area, this online community marketplace is used for everything from finding an apartment to selling a car. It’s even a great place to give away moving boxes once the dust has settled on your move, and it’s a good place to start seeking a baseline on the cost of living.

A quick search shows the cheapest place you can rent in downtown San Jose (as of November 2019) is around $1,000/month, and that’s for a bedroom in a shared house. The most expensive rental listed is a four-bedroom Queen Anne Victorian for $5,350 per month, or $64,200 per year, which is a significant chunk of that imaginary $100,000 salary.

For reference (and for fun), the Flintstone House, an I-280 landmark close to San Jose and familiar to those who travel north to San Francisco, sold in 2017 for $2.8 million. Yabba dabba doo! Even for those who are used to the astronomical home prices in the Bay Area, that’s a lot of money. Luckily for those who want to buy a house in San Jose, the median price for a single-family home in Q2 of 2019 was (only?) $1,145,000.

Let’s assume you’re looking for something between renting a single bedroom and buying the Flintstone House. What else do you need to know to buy a house in San Jose?

Other costs of moving to San Jose

The tax man/ma’am

Before you start packing, consider this: the state and local taxes in California are among the highest in the country. The sales tax rate in San Jose is 9.25%. That means that if you want to buy a 2020 Tesla Model Y (Teslas are everywhere!), you’ll pay $4,347 in sales tax. (But on the bright side, it’s a zero-emission, electric vehicle, so you’ll never have to buy gas, which is, on average, around $1 more expensive per gallon in San Jose than the national average.)

Smog inspection

In keeping with its staggering natural beauty, California is known for climate consciousness; you’ll have to keep this in mind if you move from out of state and bring a car that was made after 1975. The strict emissions standards require you to “smog” your vehicle before you register it, which you must do within 20 days of establishing residency (you have 10 days to get a California driver’s license). When you head to the DMV, we recommend making an appointment… and bringing a book.

(Almost) nothing but blue skies

Most of San Jose’s neighborhoods were built before central air conditioning was standard, but you can expect to find forced-air heating systems in most homes. Luckily for residents of San Jose, the weather is mild. No hurricanes, no tornados. It never snows (well, one time it did), it seldom gets above 90 or under 50 degrees. Most of your heating and cooling issues can be solved by opening or closing a window.

Water rights

What you don’t spend on heating and cooling, you may end up spending on your water bill, especially if you take long showers, wash your Tesla frequently, or aspire to have a lush green lawn. Our advice: Keep your pool public, and keep your yard xeriscaped.

Quick tips to prevent earthquakes in your home  

Kidding! It’s always “earthquake weather” in California, and while this is an unavoidable truth, homes are built with safety in mind. The occasional, gentle reminders about the state’s fault lines don’t faze most Californians, knowing their homes are built safe and their earthquake kit is ready to go. Many people are surprised to learn that although your standard homeowner’s policy does not cover earthquake damage, most Californians opt out of earthquake insurance. Why? Though the premiums are considered affordable by most, the deductible is so high, it’s not worth the money. But rest easy: the state of California only (only?) has a few earthquakes each year that are large enough to cause damage.

San Jose and beyond

San Jose is in the heart of Silicon Valley and is connected to San Francisco by two major interstate highways: I-280 and I-101. Insider tip for midwesterners: “freeway” is the local term used for “highway.” Insider-insider tip: for reasons nobody can remember, 101 is known as, “The 101”.  The 101 will also take you all the way to Los Angeles, unless you prefer the inland route, which is also mysteriously bestowed an article: “The 5.”

A Clipper Card is invaluable if you don’t walk around with exact change in your pocket. A quick tap of the RFID is your ticket to ride any of the Bay Area and Silicon Valley transportation systems. For drivers, a Fastrak account is essential to breeze through toll bridges, and, like the Clipper Card, you can set it up so it automatically deducts from your bank account.

To get around in the city on San Jose, the Valley Transportation Authority (VTA) has you covered for bus and light rail. A single-ride fare is $2.50 as of December 2019, and weekly, monthly, and annual passes are available, with discounts for seniors, the disabled, and youth.

Caltrain is the best bet if you buy a house in San Jose but work or play in San Francisco. Downtown San Jose’s Diridon stop offers express trains that can get you to SF in just over an hour.

Eventually, Downtown San Jose will be connected to the Bay’s other major cities and suburbs by BART (Bay Area Rapid Transit), but despite approved plans and the hopes and dreams of millions, by most estimates we’ll be well into the 2030s when it finally happens. But downtown is much more than its trains and tall buildings. Its real estate offerings range from trim, modern condos to sprawling Victorians. In the last decade, the city has invested heavily in the area, and the time and attention has paid off, drawing both residents and tourists to the attractions.

A beautiful day in these neighborhoods

When you find yourself downtown, check out the Children’s Discovery Museum, a place where play and learning come together in the spirit of discovery. For older kids (or adults who still love to play) The Tech Interactive, a science and technology center with accessible, hands-on exhibits, is also a great way to spend the day, and the space features an IMAX theater if anyone needs a break from the adventure. The Museum of Art is free to those under 17 (free!) and cheap for adults ($10!).

If you prefer a neighborhood a little more Norman Rockwell-esque (picture soft, dappled light filtering through wide, tree-lined streets), Willow Glen may be your cup of tea. It’s close to downtown proper, and it has its own mini-downtown on Lincoln Avenue, which is known for walkable shopping and thoughtful-but-not-fussy dining. Willow Glen is quiet (though close to major freeways), safe, full of historic buildings, and has long been one of the most desirable places to live and own property in San Jose. Needless to say, homes here don’t sit on the market long, so if your heart is set on a Rockwellian utopia, you’ll need a stellar agent to make it happen.

Like Willow Glen, Rose Garden has a “neighborly day in this beautywood” feel to it. Naturally, there is a beautiful municipal rose garden, which is free to visit. When you’re done smelling the roses, another point of interest is the Rosicrucian Egyptian Museum and Planetarium, which holds one of the largest collections of Egyptian artifacts in North America. Its northwestern edge is defined by a major freeway (I-880), so for most car commutes this is a great location.

On the opposite end of the spectrum from these two sleepy charmers is the up-and-coming neighborhood known as Santana Row. Picture posh shops, modern condos and a generally luxurious vibe. This is a ritzy place to live and shop. Known as the Rodeo Drive of Silicon Valley, residents enjoy the exuberance of the Santana Row scene, which can keep you fit, fed, and stylish, day and night. It’s practically at the intersection of I-280 and I-880, and so close to the Winchester Mystery House that if you find yourself in the area and have never visited, you should.

Founded in 1777, the city of San Jose has many long-established but ever-evolving neighborhoods, each of which offers unique cultural, culinary, and entertainment options. Our advice is to take some time to soak it all in. And, if you’re serious about buying, get an agent ASAP. Nobody is more qualified than an experienced, local agent to help you keep your Glens and your Gardens straight.

When to buy a house in San Jose

HomeLight’s research has shown the best time to sell a house in San Jose is between March and August, and by those estimates, the best time to buy coincides with the worst time to sell (January). But is that all there is to it? According to Jamison, smart buyers need to look beyond the numbers. She says the best time to buy a house in San Jose is when you find the right house for you.

“It’s better to buy the right house at a fair price than it is to buy the wrong house at a good deal.”

Jamison also encourages buyers to move in quickly and make reasonable offers because the market is extremely competitive.

What does an agent do that you can’t?

Empowered by information available online, some potential homeowners believe buying a home is akin to online shopping: do your research online, find something you like, make an offer, and then call the movers. While it’s true that buyers are better informed now than they have ever been, real estate experts have a lot to offer. Jamison says,

“I tell my buyers 30% of inventory is off-market. If you are not working with a well-connected industry professional you’re missing out on a lot of opportunities. Not everything goes out to MLS or to the internet. A lot of sellers don’t want to go to the market.”

She also notes that convenience and privacy, not price, are the primary concerns for most sellers.

Insider advantage: Agents always know the scoop

Jamison emphasizes the importance of both the agent’s relationships to the area, their familiarity with the city, the county, the trends and the neighborhoods, as well as the relationship between buyer and agent. A top buyer’s agent helps buyers purchase 132 homes a year (compared to 34 for average agents in San Jose) and saves buyers an average of $77,536 on their home purchase. You could buy a second Tesla!

A strong relationship with a well-connected agent can be the difference between getting the house you want, and settling for something less. Especially in San Jose, where each seller is juggling multiple offers, you need a good agent to help you come out on top.

Header Image Source: (Uladzik Kryhin/ Shutterstock)