There are many factors which influence the price of homes in San Jose CA. One of the biggest influences is the cost of living in that area. This means that you can calculate the cost of renting an apartment or buying a home and add together the annual costs. You will get the lowest price for your desired home if you add together all the costs. Here is how to do it:
California National Average Home Price: On average, homes purchased in the national average home price have appreciated by 4% over the last five years. In the same five-year period, homes Purchased in the San Jose real estate market area increased by three percent. Over the same period, the national average home price increased by two percent. Comparing these two areas gives you a pretty good idea of what to expect in the San Jose real estate market in the near future.
Rental Income: Over the course of the last five years, the national average of rental income has risen by two percent. In the same five-year period, the real estate markets in San Jose CA changed dramatically. Rentals have decreased by eleven percent. Meanwhile, the number of new home construction projects has actually gone up by one percent. So, based on this you can calculate that rental income in the future will be lower than it is now.
Changing Trends in the Home Price-to-Rent Ratio: Home prices have risen steadily over the past few years, but they are still lower now that the overall market is depressed. The decline in the home sales and the rising number of foreclosures have made the overall home price-to rents ratio much higher than it should be. Fortunately, the number of new home construction projects is going to increase, which should reverse the trend. This should reduce the price-to rents ratio and make the home pricing much more balanced in the future.
The Future of the San Jose Real Estate Market: Due to the current job growth in Silicon Valley, future job growth is expected to reach an all time high. This means that rents will be subject to increase as well. However, there is a potential backlash in the form of a shortage of new homes on the market. As more people look to the home-buying option, the San Jose CA real estate market may face some pressure from this happening. If this happens, the forecast for the San Jose CA real estate market looks less gloomy than it does now. However, the forecast for the future of the San Jose real estate market is unknown at this time.
Current Trends in the San Jose Real Estate Market: The current job growth in Silicon Valley means that there will be an increase in the demand for labor. This will lead to a raise in the salaries that people are able to earn, which will ultimately cause an increase in the price of things like rental income in the San Jose real estate market. This is one of the major reasons why the forecast for the future of the San Jose real estate market is dim. There are many other factors affecting the future of the San Jose real estate, but the forecast for the future looks less gloomy than it did in the past few years.