Silicon Valley's dynamic, tech-based economy has inflated home prices in the area for more than two decades. But lately, thanks to a rash of IPO's and the mobility of global wealth, relatively modest properties in the suburban towns south of San Francisco have been going for mansion-like prices.
Sales of homes for $1 million or more doubled in the towns south of San Francisco in the past year, passing Beverly Hills and Miami, where the sumptuous palaces snapped up by the rich look more the part.
The current boom is not the result of an avalanche of tech start-ups. Instead, the Valley has been flooded by employees of established companies like Facebook and Google, who enjoyed a personal "liquidity event" when their companies went public in the past few years.
Another factor is the interest of buyers from China, who are looking for secure investments outside their increasingly volatile home market. Silicon Valley offers them an all-but-sure return, with the bonus of a place to send the kids to good American schools.
As demand has shot up, the price per residential square-foot has skyrocketed. A 1,700-square-foot home in Los Altos, Calif., with dated fixtures and “lots of upside potential,” is priced at $1.3 million, according to one listing. In nearby Saratoga, $1.1 million gets you 1.2 acres of land – but no house. (Read more: Silicon Valley's Boom Creates Shortage of $1 Million Homes)
In fact, inventory priced between $1 milliion and $2 million is so low at the moment, the real-estate agents we asked found it difficult to provide properties that were still active. Below, and on the following pages, find a representative selection:
Where: 18981 Palo Oaks Court, Saratoga
What You Get: Four bedrooms, granite slab kitchen, and cathedral ceilings inside; flagstone patio and pool out back.
Where: 13646 Riverdale Court, Saratoga
What You Get: Five bedrooms, with family room featuring a Brazilian hardwood floor. French doors give onto backyard with pool and access to a hiking trail.
Where: 1209 Cabrillo Lane, Burlingame, Calif.
Asking: $1,725,000 (Sale pending)
What you get: Four bedrooms, formal dining room and a kitchen with a center island in the desirable Easton neighborhood.
Where: 10517 San Felipe Road, Cupertino
What You Get: Four bedrooms including master suite, and a kitchen with granite counters and breakfast bar
Where: 1601 Shirley Avenue, Los Altos, Calif.
What You Get: Four bedrooms and family room overlooking a golf course, with white oak floors in living areas and tumble stone finishes.