I dont know about Santa Clara/San Jose (heard it is definitely softer than deadly trio Sunnyvale/MV/PA) but the most likely explanation is the Google effect. More confirmation that this is the case is that in most cases I heard the buyers put down a lot of cash (close to 80 to 100%). In a way buyers here realize that the stock market is probably in lala-land as far as Google stock price is concerned so it is easy-come, easy-go as far as the cash is concerned. In retrospect that may not be a bad idea because I know personally people who converted their 2000 stock gains into purchasing whether in Los Altos or Carmel Valley didnt regret it.
Another anecdote, one of the open houses I toured in Pleasanton, the owner said they are moving to Napa/Sonoma to retire. Probably good move since they were trying to sell their cookie-cutter in Pleasanton for $1.3mil !! Dont know whether they were successful in the sale though. There definitely is serious price pressures on the fringes of BA RE though no seriously plunges yet. Napa/Sonoma technically is too far out for working folks though and cannot be considered part of BA RE.
