For many Silicon Valley buyers, purchasing a brand-new home close to work has become increasingly difficult. With new construction townhomes often starting above $1.3 million and single-family homes frequently exceeding $2 million in San Jose, Santa Clara, and Sunnyvale, many buyers are looking just outside Silicon Valley for better value.

One city that's quickly gaining attention is Morgan Hill.

Located approximately 20-30 minutes south of San Jose, Morgan Hill offers newer communities, larger homes, quieter neighborhoods, and significantly lower entry prices compared to the core Silicon Valley market.

During a recent tour of KB Home's newest master-planned community, we explored three distinct housing options:

• Townhomes
• Duet Homes
• Single-Family Homes

Here's everything buyers should know before deciding which option fits their lifestyle.

Why Morgan Hill Is Becoming a Popular Choice

Morgan Hill has long been known for its small-town atmosphere, wineries, outdoor recreation, and excellent quality of life.

Today, it's also becoming one of the few places where buyers can still purchase brand-new construction under $1 million.

For buyers who don't mind a longer commute into Silicon Valley, Morgan Hill provides:

• More square footage
• New construction warranties
• Modern floor plans
• Lower price points
• Family-friendly neighborhoods
• Access to Highway 101 and Caltrain

As affordability continues to challenge many Bay Area buyers, communities like this are becoming increasingly attractive.

Option 1: Townhomes Starting in the Mid-$800,000s

One of the biggest highlights of the community is the selection of townhomes, with prices beginning around $834,000.

These homes are ideal for:

• First-time homebuyers
• Young professionals
• Couples
• Buyers wanting low-maintenance living

Plan 1262

The entry-level model features:

• Approximately 1,262 square feet
• 2 bedrooms
• 2.5 bathrooms
• Tandem two-car garage
• Open-concept kitchen and living area
• Balcony
• Two ensuite bedrooms

Despite being the smallest floor plan, it offers plenty of natural light and an efficient layout that maximizes every square foot.

Plan 1624

Starting around $935,000, this floor plan adds substantial space.

Highlights include:

• 4 bedrooms
• 3.5 bathrooms
• Side-by-side garage
• Separate office/flex room
• Larger kitchen
• Dedicated laundry room
• Walk-in closets

For roughly $100,000 more, buyers gain two additional bedrooms, making this an attractive option for growing families.

Plan 1790

Starting around $988,000, this is arguably the standout townhome in the community.

Benefits include:

• End-unit location
• More natural light
• Bedroom and full bath downstairs
• Larger balcony
• Spacious great room
• Premium layout

Although it has one fewer upstairs bedroom than Plan 1624, many buyers may prefer the significantly more open living space.

Option 2: Duet Homes Offer the Best of Both Worlds

One of the most unique products in the community is the Duet Home.

A duet home is essentially an attached single-family residence.

Unlike a traditional townhome, these homes offer:

• Private driveway
• Two-car garage
• Larger lots
• Backyard space
• Wider floor plans
• More privacy

Many buyers appreciate that they feel much more like detached homes while remaining more affordable than traditional single-family residences.

The Standout Feature: A Separate Studio

One floor plan includes something rarely found in new construction:

A completely separate studio apartment.

This private suite features:

• Kitchenette
• Bathroom
• Balcony
• Private entrance
• Optional interior connection

This flexible space could be used as:

• Guest suite
• Home office
• Rental income
• In-law unit
• Multi-generational living

With the growing demand for flexible living arrangements, this feature provides tremendous long-term value.

Option 3: Single-Family Homes Starting in the Low $1.3 Millions

For buyers wanting detached living, KB Home also offers several single-family floor plans.

Prices begin around $1.3 million, which is significantly lower than comparable new construction in much of Silicon Valley.

These homes offer:

• Larger backyards
• Four bedrooms
• Multiple living spaces
• Modern finishes
• Spacious primary suites

Plan 2045

Features include:

• Approximately 2,045 square feet
• Bedroom and full bathroom downstairs
• Open kitchen
• Courtyard-style backyard
• Large primary suite
• Spa-inspired bathroom
• Walk-in closet
• Upstairs laundry

The layout provides an excellent balance between entertaining space and everyday functionality.

Plan 2111

Another impressive floor plan features:

• Large downstairs guest suite
• Separate upstairs family room
• Massive primary bedroom
• Oversized walk-in closets
• Dual vanities
• Separate soaking tub and shower

Among all the homes toured, this primary suite was arguably the most luxurious.

Design Options Throughout the Community

One of the biggest advantages of purchasing early in a new construction community is the ability to personalize finishes.

Depending on availability, buyers may be able to choose:

• Cabinet colors
• Countertops
• Flooring
• Lighting
• Bathroom finishes
• Interior color palettes

Some inventory homes already include premium upgrades selected by the builder.

Additional Community Costs

Like most new construction developments, buyers should consider ongoing ownership costs beyond the purchase price.

These include:

• HOA dues of approximately $400 per month
• Mello-Roos property taxes (lower than many East Bay communities)
• Standard property taxes
• Homeowners insurance

Even with these additional expenses, many buyers may find the overall value compelling compared to newer communities closer to Silicon Valley.

Which Home Is Right for You?

Each product type serves a different buyer profile.

Townhomes

Best for:

• First-time buyers
• Professionals
• Buyers seeking affordability
• Low-maintenance living

Duet Homes

Ideal for:

• Growing families
• Multi-generational households
• Buyers wanting rental income opportunities
• Homeowners seeking more privacy

Single-Family Homes

Perfect for:

• Families needing additional space
• Buyers planning long-term ownership
• Those wanting larger yards
• Homeowners seeking detached living

Final Thoughts

Morgan Hill continues to emerge as one of the Bay Area's strongest values for buyers looking for brand-new construction. With homes ranging from the mid-$800,000s to approximately $1.3 million, this KB Home community offers options that are becoming increasingly difficult to find elsewhere in Silicon Valley.

Whether you're searching for an affordable townhome, a versatile duet with a private studio, or a spacious single-family home, this development provides modern floor plans, flexible layouts, and the opportunity to own a brand-new home at a more attainable price point.

If you're considering relocating within the Bay Area, Morgan Hill deserves a spot on your list.

Frequently Asked Questions (FAQ)

Is Morgan Hill a good place to buy a home in 2026?

Yes. Morgan Hill offers more affordable new construction compared to much of Silicon Valley while providing excellent schools, outdoor recreation, and convenient access to San Jose.

What is a duet home?

A duet home is an attached single-family residence that shares one wall with a neighboring home while offering many features of a detached house, including private garages and outdoor space.

Are there new homes under $1 million in the Bay Area?

Yes. This KB Home community in Morgan Hill offers several townhome floor plans starting in the mid-$800,000s.

How much are HOA fees?

HOA dues are approximately $400 per month, depending on the specific home and phase.

Are these homes good for first-time buyers?

Absolutely. The townhomes provide an excellent entry point into homeownership with modern layouts, attached garages, and lower maintenance compared to detached homes.

Call to Action

Thinking about buying a brand-new home in the Bay Area? Whether you're comparing townhomes, duet homes, or single-family residences, having local market expertise can help you secure the right home at the best value. Contact Spencer Hsu Real Estate Team to schedule a private tour, compare builder incentives, and determine which new construction community best fits your lifestyle and budget.