Gilroy has long been known as the “Gateway to Silicon Valley,” sitting at the southern edge of Santa Clara County where Bay Area pressure finally starts to loosen. However, as 2025 unfolds, many buyers and renters are asking a critical question once again:
Is Gilroy still truly affordable—or has it finally crossed the line like the rest of Silicon Valley?
Interestingly enough, the answer is not as simple as yes or no. Instead, affordability in Gilroy now depends heavily on income source, housing strategy, and commute tolerance. And yet—despite rising costs—Gilroy still occupies a rare middle ground between Bay Area proximity and real-world livability.
First, the Big Picture: Why Gilroy Still Attracts Budget-Conscious Buyers
To begin with—and this matters tremendously—Gilroy remains one of the last South Bay cities where buyers can still access single-family homes at prices far below the Silicon Valley core.
Meanwhile, as San Jose, Mountain View, Sunnyvale, and Santa Clara continue to push upward, Gilroy keeps absorbing overflow demand from buyers who want:
- More living space
- Lower monthly payments
- Less density
- And fewer bidding wars
Consequently, Gilroy has become a pressure-release valve for Silicon Valley’s affordability crisis.
Even more importantly, buyers relocating from the urban core often feel immediate financial relief—despite still being inside Santa Clara County.
Housing Costs in Gilroy: Still Below the Bay Area, But Not “Cheap”
Now, here’s where reality hits.
Yes—Gilroy remains cheaper than most of the South Bay.
However—no—it is no longer cheap by national standards.
In 2025, renters can still find two-bedroom apartments at rates that look reasonable compared to San Jose. Meanwhile, buyers are still entering the market at prices that would be impossible further north.
That said, location inside Gilroy still matters significantly:
- Homes near downtown and major freeway access command higher prices
- Newer master-planned communities continue pushing pricing upward
- Outlying neighborhoods still offer the most consistent value
And yet—despite all of this—Gilroy still delivers one of the lowest average cost-per-square-foot options in Santa Clara County.
Utilities in 2025: The Cost That Slowly Creeps Up
While housing dominates the budget, utilities quietly eat into monthly cash flow over time.
In Gilroy, electricity remains one of the largest variables due to:
- Summer heat
- Air conditioning usage
- Tiered utility pricing structures
Meanwhile:
- Natural gas remains moderate
- Water and trash remain stable
- Internet pricing is competitive due to regional provider overlap
However—taken together—utilities now represent a larger share of total monthly cost than they did just five years ago.
In other words:
Housing shocks the wallet upfront.
Utilities slowly erode it over time.
Grocery & Food Costs: Where Gilroy Still Wins
Here’s where Gilroy still quietly outperforms much of the South Bay.
Due to:
- Proximity to agricultural supply chains
- Larger grocery footprints
- Lower commercial lease pressure
Food pricing in Gilroy remains noticeably lower than San Jose, Cupertino, or Mountain View.
Additionally, the city benefits from:
- Regional produce access
- Family-owned markets
- Warehouse retailers within short driving distance
Dining out, however, now reflects post-inflation California pricing, especially at sit-down restaurants.
Still—balanced against housing—Gilroy remains one of the better food-cost cities inside Santa Clara County.
Transportation: The Hidden Price of “Affordability”
This is where Gilroy’s affordability equation becomes a tradeoff.
Because:
- Public transportation options are limited
- Most residents commute by car
- And many drive north for work
Transportation expenses often rise faster than buyers initially expect.
Between:
- Fuel
- Insurance
- Maintenance
- Toll roads
- And long commute cycles
Transportation becomes one of the three biggest monthly expenses for many Gilroy households.
So while the home may be cheaper—the commute quietly becomes the counterweight.
Taxes & Local Fees: Still Silicon Valley Rules
Despite being more affordable than nearby cities, Gilroy does not escape Bay Area tax structures.
Residents still face:
- High state income taxes
- Elevated sales tax
- Annual vehicle registration costs
- Rising service and infrastructure fees
For homeowners, property tax calculations still operate under typical Santa Clara County assumptions, which means ownership costs rise steadily over time—even without a home price jump.
The Real Monthly Reality in 2025
Once all expenses stack together—housing, utilities, food, transportation, taxes, and discretionary spending—Gilroy’s affordability becomes relative rather than absolute.
For:
- Singles → Gilroy still works with budget discipline
- Couples → Gilroy remains comfortable with controlled lifestyle choices
- Families → Gilroy requires stable dual-income structure
In short:
Gilroy is no longer a “budget city.”
But it still functions as a strategic affordability zone inside Silicon Valley.
Why Gilroy’s Future Is Tied to Regional Bay Area Development
Gilroy’s affordability does not exist in isolation. It is directly influenced by what happens north of it.
As major development projects expand across the Bay Area, housing pressure continues to migrate outward. You can already see how large-scale real estate and infrastructure shifts will reshape regional demand here:
👉 https://temblog.org/the-new-bay-area-5-mega-projects-reshaping-the-real-estate-landscape-in-2025/
At the same time, weekly inventory changes and pricing behavior across the Bay ripple directly into Gilroy’s demand patterns:
👉 https://temblog.org/bay-area-housing-market-update-this-week-prices-inventory-buyer-demand/
Thus, Gilroy’s affordability future is now welded to Bay Area macro trends, not just local conditions.
Is Gilroy Still Affordable Compared to San Jose?
Yes—by a wide margin.
But that gap is narrower than it used to be.
What used to feel like a dramatic financial reset now feels more like a controlled downgrade with lifestyle compensation through space and quality of life.
The Psychological Shift: From “Affordable” to “Strategically Priced”
Perhaps the most important shift in 2025 is not numeric—it’s psychological.
Buyers no longer say:
“Gilroy is cheap.”
They now say:
“Gilroy still makes sense.”
And that distinction is crucial.
Because once buyers stop calling a market “cheap,”
it usually means the next pricing cycle has already begun.
Final Verdict: Is Gilroy Still Affordable in 2025?
Yes—relative to Silicon Valley.
No—relative to the rest of the country.
Gilroy now sits in the rare category of:
- “Affordable for where it is”
Not - “Affordable in absolute terms”
For buyers priced out of San Jose, Santa Clara, and the Peninsula, Gilroy still represents one of the last sustainable ownership paths without fully exiting Silicon Valley.
And in 2025—that alone makes it one of the most strategically important cities in the South Bay.
