As if we needed more proof that San Jose is expensive...

Forbes decided to give it to us, in the form of an informative little article detailing some of this country's most highbrow neighborhoods, where residents pay astronomical amounts for the privilege of owning their properties instead of renting them. 

These are the few pockets where homeowners are still willing to take a chance on the future appreciation of their homes. First place mentioned? 

Ladies and Gentlemen, your very own San Jose, CA. 

Particularly the neighborhood of Willow Glen, where residents pay the city's highest prices relative to what they could pay to rent similar properties in the same area. Chances are, the people paying crazy mortgages in Willow Glen won't lose out. San Jose, like most of the Silicon Valley area, has weathered the foreclosure crisis very well and has insurance in the form of tech jobs that should bolster prices in the years to come. 

Still, seeing how much money owners are willing to pay to hold onto their properties in Willow Glen is an eye opener. In America's Most Overpriced Zip Codes, Matt Woolsey writes-- 

"When you compare mortgage payments to the value of a similar home on the rental market, the price to buy is 26.1 times higher, one of the biggest differences in the country."

But it could be worse. It could be TriBeCa, or Boston's Chinatown. Other similar neighborhoods include downtown Seattle, Mission Hills San Diego, and Coronado, Phoenix. 

San Jose is the Best City for Home Sellers

According to an article in Forbes, San Jose and San Francisco top the list of best cities for home sellers. 

Both cities have some of the most expensive houses on the market and sellers in San Jose have the benefit of a relatively good economy because tech money and venture capital money keep it afloat. It's difficult to overbuild in San Jose, so new construction drops while job availability grows. This makes for the tightest market in the country--home vacancies are at .8%, the national bottom.  San Jose is number one on the Forbes list.

Number two is San Francisco. There the conforming loan limit rose from $417,000 to the max $729,750.  For the city's home buyers, this makes getting credit much easier. A construction cut has pushed vacancy rates down, and the new Fannie Mae and Freddie Mac limits provide increased exposure to credit. 

This affects the surrounding areas as well-- In Santa Clara and San Mateo counties, conditions are the same for sellers. Conforming loan limits are higher, and the markets are just as tight as in San Jose. 

From the article--

San Jose and San Francisco came out on top because they fit the profile of a sellers' market-- low inventory rates that were still shrinking, good job creation, a large scale cutback in new home construction and a boost in the credit market from the new Fannie and Freddie loan limits. 

 The areas surrounding San Jose and San Francisco have equally great sellers' markets, for exactly the same reasons---low vacancy rates and availability, high demand for jobs, and cutbacks in construction. Mix in the boost to the credit market and Santa Clara and San Mateo counties are great places to sell, compared to the rest of the country.

For the Forbes article, CLICK HERE.