"Location, Location, Location" is the law of real estate. Even children have heard it!
Of course you want to live in "a good location". But how do you settle on one? As a first-time homebuyer, most likely you are looking at a modest condo, townhome or house in Silicon Valley.
In every home purchase, there are compromises. Even when buying multi-million dollar homes, buyers compromise. If your list of things you want in a home has 10 items, there's a good chance you can get many or most of them. But few people are able to get 100% of what they want for the budget they have. (We all seem to want whatever costs about 20% more than we can afford. And that's true all over Santa Clara County, and it's true in all price ranges.)
There are things you must have, things that are important to have, and things you'd like to have. A good starting point for you is to jot down everything - brainstorm your list of what your ideal home in the San Jose area would have - and then move these items into one of the three columns of must, important, and would like.
Let's go through an example together.
In this fictitious scenario, we'll say a young couple is buying a first home in the Santa Clara Valley and they are hoping to have children in the next few years. They are thinking of safety first (low crime area), but also schools. They have a busy social life so really prefer a newer home, or one that is 100% remodeled. They don't want to spend the time or money to rehab a forty year old home. They both work in Cupertino and want a short commute. Their budget is approximately $700,000. They could go higher but are nervous about the risks involved and are not sure they'll always have two incomes. They have read that buying a single family home is more adviseable than buying a townhouse. But they also want to live in Saratoga with Saratoga Schools.
This type of example is actually not all that uncommon.
Something's gotta give!
If you have ever looked at the cost of homebuying in Silicon Valley, you know that a house in Saratoga with Saratoga Schools is nowhere near being as cheap as $700,000. You can buy a condo in Saratoga and in the school district for that amount, but not a single family home.
If this couple were to make their budget the top priority, then the first choice is to decide which is more important, the single family home or the location?
Given that there are no children on the scene yet, most couples would say that they'll buy a house in the best school district they can afford now, and try to upgrade the location later.
Their $700,000 budget will likely put them in West San Jose, Campbell, Santa Clara (in the section that offers Cupertino schools) or Cambrian Park. All of these areas do have good schools (they range from good to very very good) and low crime and are fairly close to Cupertino.
Then it's a tradeoff between condition and location. For the money, there's a ratio between the best locations and the condition of the home. A lesser location will provide the buyer with a nicer home for the money.
This is a very normal dilemma: how important IS condition vs location? You can't have both the best location and the best condition. Where will you compromise?
That's a personal decision, but I will tell you this: most Realtors will tell you "buy the most house in the best neighborhood you can afford". This age-old advice is good advice. You can always improve your home, but you cannot improve your neighborhood - at least not easily!
Think of it this way: there are things you can change and things you cannot change.
Buy a brand new house right next to the freeway? Some will do it because they are so enamored with the "newness" of the house. But some day...that same house will no longer be new. Then you will have an old house by the freeway. See the problem?
Buy with selling in mind!
It's easy to tell yourself, "I don't mind the xyz problem" (freeway, busy road, high voltage power lines), "I am going to live here forever". Truth is, we never know what may happen. Sometimes people end up having to sell a home they expected to be in forever. And if they have to sell in a down market, the results can be financially disastrous.
We have many excellent communities and neighborhoods in Silicon Valley. San Jose actually enjoys the lowest crime rate of any big city in the US! Sunnyvale is one of the lowest crime rates of a mid-sized city anywhere in the US too.
My general advice regarding location is this:
(1) Pick an area that is fairly safe
(2) Pick an area where the schools are in the upper half (ideally upper third) of the county for scores - poor schools will impact your sale, especially in a bad year
(3) If you can afford a house instead of a condo or townhome, buy it (and a TH over a condo if possible)
Would you like specific information on Santa Clara County and other nearby communities? I have descriptions on my website. Please visit PopeHandy.com and have a look!
And if you'd like help sludging through your priorities list, give me a call. I will help you to sort through things so you get the most for your money (with the least risk).
Happy househunting!
Hints that the area isn't a good one may be just in front of you, but you need to know what you're looking for. If you're serious about buying (or even renting) a Silicon Valley home, visit the neighborhood at several different times over the course of a few days. It may be "OK" on a weekday and horrible on a Saturday night - so check it out!
