Building Costs Per Square Foot in the City of San Jose (CA), USA

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San Jose 4703 Parkwest Drive CA95130 - 5 Bed and 4 Baths with Attached Garage on Gross Floor Area 2,556 sqft - Built in 2022 - Price $2,949,000 (3)

Newly Built House in San Jose 4703 Parkwest Drive CA95130 – 5 Bed and 4 Baths with Attached Garage on Gross Floor Area 2,556 sqft – Built in 2022 – Price $2,949,000 (3)

Residential Construction Market Analysis in the City of San Jose, USA

Building costs are 17% above the national average in the City of San Jose in California. San Jose is one of the cities that is expected to grow the most in the coming years. Giant companies like Paypal, Apple, and Google have their headquarters here, which makes many young people move to work in this area, or even people from all over the world move to work here.

This makes the real estate market one of the hottest and most prosperous in the entire country. In any case, it has its peculiarities and it is important to know them well before deciding if you want to invest or buy properties here.

We prepared this article with all the information you need to know about the residential construction market in San Jose. From current property values, to what is expected to happen in the next few years. We’ve also added a construction outlook so you know what to expect once you immerse yourself in the San Jose real estate market. Continue reading this article to get to know all that and much more.

San Jose Construction Outlook

San Jose is a city that is constantly growing. Just 30 years ago it was practically an empty city, without life, but the arrival of companies like Google, and Apple, among other giants in the world of technology, made the population begin to increase.

San Jose is an attractive city for people from all around the globe, and some of them are the richest people in the world. That is why it has neighborhoods filled only with mansions and luxury houses. These mansions can easily exceed $5M in value, so be prepared to have some rich neighbors.

There are slightly more affordable neighborhoods like White Oaks or Bucknall, but the price of the properties is still high. Here the residential houses are more modest, surpassing only in some cases the 4 rooms. San Jose is characterized by large houses, so the rooms are always spacious.

Also in downtown San Jose, you can find some buildings. Here are some that easily exceed 20 stories, although the most common is 10 stories. The apartments are usually for couples, people who live alone, or people who live with roommates. It is rare to see families living in apartments in San Jose, but it is not impossible.

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San Jose Housing Market Analysis and Forecast

In San Jose, there is a fairly even relationship between the number of people who own properties and those who rent. 60% of the houses are occupied by people who own those properties, and 40% are inhabited by renters. This is because there are many people who go to work temporarily in San Jose, so it is not convenient for them to buy a property.

This large number of tenants (in other cities in the United States the ratio is 70-30 or 80-20), makes the real estate market not so competitive for the purchase, and you can get a good property. This doesn’t mean that the prices for buying a new property are cheap.

San Jose is an expensive city because it attracts people from everywhere you can think of. This is the main reason why the property values increased more than 20% just from 2021 to this year. Properties often sell for the above list price, which is a big plus for people looking to sell their properties, but not for buyers.

Sellers know that there is great interest in homes in the area, and for this reason, they wait the necessary time to receive the best possible offer. In addition, sellers benefit from the fast time of sale, houses take an average of 30 days to sell, while the national average is 90 days.

San Jose Average House Price (Median Home Price)

The median home value in San Jose is a staggering $1.4M, which is 25% more than it was in May of last year when the value was $1.1M. The value is higher than the national average, especially since it is a place where CEOs live, the most influential people in the world of technology, and buying a house costs a fortune.

The value of the average single-family house is $1.6M and that of properties in condominiums or apartments is $900,000, which is much more affordable. Remember that the number is an average price, so you can find more expensive properties and cheaper ones. However, San Jose is simply an expensive city, even with prices higher than Los Angeles.

You can find some apartments for $800,000, and there are some houses that cost $600,000, but in these cases, they usually need some kind of restoration. Restorations can cost a little over $100,000 or $200,000, so in some cases, it is better to buy houses to fix them than new houses. New homes are always over $1M here in San Jose.

Proposed Residential Building Projects in San Jose

The projects that are coming up in San Jose are quite varied, but if you are interested, you must be prepared to make a large investment.

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There are several condominium projects or buildings with less than 10 floors, especially in the area surrounding the universities of San Jose. There are more than 5 universities in San Jose, including state universities, community colleges, and prestigious university campuses. For this reason, there are always university students from all over the world moving. Investors have noticed this and that is why there are condominium projects with apartments designed specifically to be rented.

In the city of San Jose you can also find some wonderful luxury houses being constructed this year. Some construction companies promoted projects of 5 luxury houses, with swimming pools and large gardens, full of grass, and even the largest mansions have stables for horses. These are authentic mansions, just like the ones you would see in California‘s most expensive neighborhoods like Bel-Air or Beverly Hills. These mansions exceed the value of $5M, even in some cases, they reach $10M.

San Jose 262 Union Avenue Los Gatos CA-95032 - 2 Bed and 2 Baths on Gross Floor Area 1008 sqft - Built in 2022 - Price $1,149,000 (3)

Newly Built House in San Jose 262 Union Avenue Los Gatos CA-95032 – 2 Bed and 2 Baths on Gross Floor Area 1008 sqft – Built in 2022 – Price $1,149,000 (3)

Building Costs Per Square Foot for Single Family Homes in the City of San Jose (CA), USA

Building costs are 17% above the national average in the City of San Jose in California.

Class 1 – Luxury Single Family Homes

The building cost per square foot for luxury private homes in San Jose City ranges from $403.52 per sqft to $618.58 per sqft, with the average being $476.21 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 2 – Semi Luxury Single Family Homes

The building cost per square foot for semi-luxury private homes in San Jose City ranges from $245.24 per sqft to $375.92 per sqft, with the average being $289.41 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 3 – Best Standard Single Family Homes

The building cost per square foot for best-standard private homes in San Jose City ranges from $158.54 per sqft to $240.80 per sqft, with the average being $185.61 per sqft. As the bar chart shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

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Class 4 – Good Standard Single Family Homes

The building cost per square foot for good-standard private homes in San Jose City ranges from $115.70 per sqft to $177.43 per sqft, with the average being $136.55 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 5 – Average Standard Single Family Homes

The building cost per square foot for average-standard private homes in San Jose City ranges from $93.92 per sqft to $143.83 per sqft, with the average being $110.74 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.

Class 6 – Minimum Standard Single Family Homes

The building cost per square foot for minimum-standard private homes in San Jose City ranges from $74.07 per sqft to $113.54 per sqft, with the average being $87.38 per sqft. As the bar graph shows below, bigger homes with a large gross floor area have the lowest building costs per ft2, and smaller homes with a small gross floor area have the highest building costs per ft2. Medium-sized homes are somewhere in between. Generally, the building cost per square foot decreases as the size of the house gets bigger, and increases as the house gets smaller.


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