Silicon Valley rents fall as downturn hits home

NEWS Perhaps the most concrete sign of the slump to hit the once mighty Silicon Valley was revealed today - house rents in the San José area of California have fallen by almost a quarter since last year. Silicon Valley, south of San Francisco in California, was the very centre of the high-tech bubble. Back in 2000, with salaries sky high, and dot-com millionaires two-a-penny, the only problem was how to fit so many rich people into such a small space. Consequently rents rocketed, and attendant problems of overcrowding and overdevelopment, such as traffic jams and miserable amenities were the typical bugbears of its inhabitants. But now, according to the Associated Press, rents in the heart of Silicon Valley - Santa Clara - have fallen from an average of $1,935 per month last year to $1,507 this year- a fall of 22 per cent. The fall undoubtedly reflects the huge job losses the area has sustained in the last year and a half. Suddenly once-mighty dot-com entrepreneurs have upped sticks and left, and IT contractors are no longer in demand. According to the study the area around San Francisco (including Silicon Valley) was the only city in the western US to see house rents fall.