Determining the value of homes in the 95127 hills?

Asked by Mitchell Family, 95127 Wed Jun 9, 2010

We are interested in purchasing a house in the beautiful 95127 hills. Although it's definitely a concern that you have to go through a bad area to get to any of the major freeways (especially to the 101), the price, views, and amount of home you get in the area is a good trade off.

Now here's our dilemma, as any of you guys familiar with the homes in the 95127 hills probably know, the homes vary DRASTICALLY. Not only is it possible to have a 500k home next to a 1.5million home, it's actually quite common. Homes vary is size, style, view, age, etc etc. So this makes finding comparable homes to base the value of the home you want to purchase a nightmare. Not only does it have to match those characteristics, it has to have been sold recently!

So tell me, in instances where it is difficult to find comparable homes sold recently, what do you do?

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CJ Brasiel, Agent, San Jose, CA
Wed Jun 23, 2010
Ruth and Perry -

This is where it really counts to understand all the features of the property and compare carefully. Identifying the "average" price per square foot is a start but then identifying value for the lot based on how "use-able" it is is also key. Views, not only now but what is the potential for obstruction by future building? There is also potential value in the fact that the ability to add on to the home in the future (assumed large lot) that can also play a role. Also, is the lot landscaped or natural? The value of having an adequately irrigated large lot has value.

Privacy is another key factor to the value as well as exclusivity. Is it gated (can it be)? Are there neighbors right next to you or is their a measure of seclusion? Also construction plays a more important role for these homes. Are there proper retaining walls? Is the foundation significant or just adequate? Hills tend to slide over time and preparing a home site takes considerable consideration.

Finally, adding in all the specific features of the actual floor plan. Does the house take advantage of lots of windows for views? Is there adequate decking to enjoy views/outside living? How many rooms/baths? Appropriate for lot size? Security? The ability to entertain? High ceilings? Heating/AC efficiency?

These homes take more detailed analysis than simply last sold 3/2 in the zip code. If you would like a second opinion, I am glad to help. No obligation.

Thank you,
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Ruth and Per…, Agent, Los Gatos, CA
Fri Jun 11, 2010
Hi Mitchell:

A lot depends on the home its a case by case situation as to the attributes of the home.

More importantly, you should also find out how many homes are headed towards Short Sales and foreclosing around the home of choice.

If you need help call me at 408-656-5343.

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Norman Aless…, Agent, San Jose, CA
Fri Jun 11, 2010
In instances like this I usually look at square footage price, upgrades, age , zip code and SCHOOLS ( thats a big one). It is usually possible to find comparables, if they are not within the last 3 months then you have to go back six months etc:, if that doesn't work you have to expand your area or square footage then work out average prices.
If you need help let me know.
DRE# 01397256
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Richard Schu…, Agent, Los Angeles, CA
Thu Jun 10, 2010
There's a reason a house is 500K vs 1.5M, even if they're right next door. One may be much newer construction. One may be much larger. One may be in superior condition. All of these things are factored in when home values are appraised. Appraisers are aware (best they can be) of all of these factors, and have a formula for determining a home's value. But you're right, it might not always be easy to find comps. Appraisers have to just do the best they can sometimes. If you're not happy with one appraisal (if the issue is getting the home appraised for a loan), request another appraisal if possible.

And otherwise, a home is "worth" as much as someone is willing to pay for it. How much is it worth to you? What would you be upset if you found out it sold for and you didn't get it?

Speak to a Realtor in your area, who is experienced and knowledgeable about the area. They will be able to give you more specialized advice too, and help you out. They can help recommend what prices are reasonable to offer and expect to pay. If you need a referral for an agent in your area, let me know.

Best of luck,
Richard Schulman
Keller Williams Realty
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