Median home prices in San Jose are at $720,600.

It'll cost you $865,000 to buy a medium priced home in Pleasanton. It drops to $616,700 by the time you reach Livermore and $370,000 when you cross the Altamont Pass into Tracy.

So why should any of this concern you if you live in Ceres, Modesto, Turlock, Manteca, Lathrop, Ripon, Patterson, or Stockton?

The reason is simple. Housing is the biggest part of a typical family budget accounting for 20 to 35 percent of all expenditures.

If you rent, you should worry about ever increasing prices in San Jose, Pleasanton, and Livermore. If you are looking to buy it mean prices will be going up.

That's when housing price spikes in the job rich, high-income Bay Area it creates a housing price tsunami with major ripple effects that cross the Altamont Pass sending up prices. It squeezes people out of the Bay Area with tight housing inventories and very few places left to build.

The 209, in essence, becomes the de facto affordable housing solution for the Bay Area. More people look at the homes and lifestyle they can buy east of the Altamont compared to what they can afford trying to find a place they can afford in the Bay Area, realize the added commute expense is offset by housing savings, and they pull up stakes to move to the 209.

In a year or so, it will become an extreme rarity that people who live and work in Lathrop and Manteca will be able to afford to buy a home in the community where they work. Eventually rents will become a crushing weight on many.

It is why if you've got any inkling of wanting to own a home anywhere in the Northern San Joaquin Valley you might want to get your act together and do it soon.

This is not conjecture. It has happened two times before.
Actually the tsunami effect of San Jose prices has occurred more than that. But it wasn't until the build-up in the late 1980s and then in the late 1990s that prices and demand got to the point they were starting to squeeze local buyers out of the new housing market - and sometimes the resale market as well - in Tracy, Lathrop, Manteca, and Ripon.

Typically every mile you get closer to San Jose or San Francisco brings with it an uptick in price. There are exceptions. Pleasanton, as an example, is considered a more desirable community, has a median price for homes higher than some cities much closer to the Silicon Valley and The City.

The same is true of Ripon in the Northern San Joaquin Valley.

And when the economic retraction comes - and it will - the outer commute from the Silicon Valley will retract for home buyers. In the late 1980s, it retreated to Pleasanton insulating it somewhat from the weakened housing market and protecting prices better than in most places as home values fell. Last decade, it was Livermore. The next time the housing market softens, it is likely the outer commute for those still buying amid falling prices will be Tracy.

At least that's the established pattern.