San Jose was recently ranked as the best city for home sellers by Forbes.com. In the “Best Cities for Home Sellers” article by Matt Woolsey, San Jose is ranked as the top city for home sellers out of the country’s 40 largest metro areas. San Jose earned the top spot based on its tough regulatory measures on new construction and job growth. New home construction in San Jose fell 63% in 2007 compared to 2006. The decline is attributed to the city’s strict regulations which limit overbuilding commonly found in many declining markets today. Home vacancy rates were also at a national low at 0.8%. On the job front, San Jose experienced a 1.2% increase in employment rates. Combine these factors with the new conforming loan limits and San Jose comes out as the #1 city to be a home seller.

San Jose edge out its neighbor to the north, San Francisco, for the top spot. San Francisco ranked second on the list of best cities for home sellers. Other notable city rankings include Salt Lake City #3, Denver #7, Seattle #10, and New York City #21.

To assess conditions for home sellers, the rankings were based on the following factors: unsold vacancy rates, construction projects started, and employment creation. The article also factored in the impact which new conforming loan limits would help each market’s lending.

Read the full Forbes.com article.