No, you people don't get it. That house is on a large lot. You could knock it down, build a much bigger house for a 1 million and have a 4-5 million dollar house for 3.5 million. it's a good deal.
The point is that even a 3.5M for the new house will be a lot, but by virtue of it's location and salaries at Apple it's justifiable
https://www.redfin.com/city/19457/CA/Sunnyvale/filter/min-lo...
2,5M, with respect to the existing market, doesn't appear to be out of the norm.
The idea being Sunnyvale can justify that with salaries and the employers in the area