Keeping you up to date with Santa Cruz Real Estate

Weekly Market Update

• The hottest zip code in the county this week in terms of the Market Action Index (ratio of inventory/homes selling) is Soquel (95073) with an index of 49 and a median list price of $1,989,500.
• 22 properties sold in the county this week with an average sale price of $1,611,023.
• There are 478 active for sale properties on the market here in Santa Cruz County. (it was 500 last week). This is the first week in a few months that we have seen a significant change in inventory.
• There are parallels between labor and housing markets: Both markets are experiencing a "Great Stay," where people are hesitant to change jobs or sell homes due to economic uncertainty and favorable existing conditions.
• Countywide, the housing market was largely flat through the summer, with 131 home sales in July and 132 in August, before dropping 25% in September to 99 home sales, according to data from the Santa Cruz County Association of Realtors.

Local News

Carmageddon: As West Cliff repairs continue, crews call scale of work ‘unprecedented’

Major projects underway to repair storm damage on West Cliff Drive in Santa Cruz represent an “unprecedented” level of work on the scenic coastal road, Santa Cruz city officials said during a tour of the project Wednesday. They’re hopeful some of the projects will be complete by the end of the year.

During the tour, Assistant Director of Public Works Kevin Crossley discussed and explained work on a stretch of West Cliff Drive between Columbia Street and Woodrow Avenue that has been closed to two-way traffic for more than 18 months. He talked about a sinkhole that opened up in the area earlier this year, and the intent of a Bethany Curve culvert repair. 

Crossley said that the stretch between Columbia Street and Woodrow Avenue is in the final stages of a year’s worth of work. The city aims to install a new railing along the ocean side of the pedestrian path next week. However, the sinkhole that opened up in that same section of road earlier this year has complicated the project, something Crossley said is “going to keep us busy through the remainder of the year.”

Market Matters

The Great Stay: Why Homeowners Are Staying Put

The labor market and the housing market highlights a shared hesitancy and caution in both sectors, particularly in the post-pandemic era. Let's break down a few of the key dynamics:

1. Labor Market: Stagnation Despite Low Unemployment

• The low unemployment rate typically suggests a tight labor market, which usually empowers workers to switch jobs or negotiate better pay and conditions. Yet, despite low unemployment, workers appear more cautious about quitting their jobs.
• Hiring Caution: Companies seem to be hiring more cautiously, possibly due to economic uncertainty (inflation, supply chain disruptions, or fears of a downturn). This leads to fewer opportunities for workers to comfortably switch roles.
• Fear of Quitting: Workers may be reluctant to quit even if they dislike their current jobs, as the pace of hiring is slower, making it riskier to move in search of a new position.

1. Housing Market: Similar Caution

• In the housing market, similar hesitancy is apparent. People who may have once considered moving or upgrading their homes are reluctant to make big changes due to high mortgage rates, affordability issues, and economic uncertainty.
• Reluctance to Sell: Homeowners with low fixed-rate mortgages may be reluctant to sell because buying a new home would likely mean taking on a mortgage at a higher interest rate. As a result, they stay put, which reduces inventory.
• Reluctance to Buy: Potential buyers face higher monthly payments due to rising interest rates, limiting their purchasing power and pushing many to wait for rates or prices to drop.

In both cases, the market seems "stuck." For the labor market, companies don’t want to over-hire, and employees don’t want to leave their jobs. Similarly, in the housing market, sellers don’t want to move due to higher costs, and buyers are waiting for a more favorable time to purchase. This results in a lack of mobility in both markets, where fewer transactions are happening than might be expected in normal times.

Summarized from Mike Simonsen's October 15, 2024 Article (Same Title)

Other Headlines

-Mortgage Rates Back Near 6.5%: The average 30-year conforming rate bottomed out at 6.24% on Sept. 27. That was the lowest figure since February 2023. But after muddling along for another week, rates rose again and stood at 6.49% on Wednesday. The average 15-year conforming rate jumped even more sharply during this time, going from 5.58% to 6.02%.

-Lower Energy Costs Drive Lower U.S. Construction Input Prices in September: According to new analysis by the Associated Builders and Contractors based on data from the U.S. Bureau of Labor Statistics' Producer Price Index, U.S. construction input prices fell by 0.9% in September 2024 compared to the previous month, Nonresidential construction input prices also dropped by 0.9% during the same period.

-Number of U.S. Home Sales Hit 30 Year Low in 2024: According to a recent Redfin report, only 25 out of every 1,000 U.S. homes changed ownership in the first eight months of 2024, marking the lowest housing turnover rate in 30 years. Redfin's analysis, which focused on turnover as an indicator of housing availability, compared data across various metro areas, home types, and neighborhoods from 2012 to 2024. This year's turnover rate is the lowest since at least the early 1990s.

Local Market Data

ALTOS Research Market Report

ALTOS RESEARCH MARKET REPORT IS AN INTERACTIVE, REAL-TIME REPORT. IT DISPLAYS THE CURRENT ACTIVITY FOR ANY MARKET YOU WISH.

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US Market Summary

My Listings

Coming Soon: 1485 Dougmar Drive, Santa Cruz- This 2,000 sqft 3 bedroom, 2 bath home was purchased by my client off market and has gone through extensive remodeling and will be on the market shortly. Improvements include: new roof, new flooring, new doors, new windows, new on-demand water heater, new bathrooms, new kitchen, new lighting throughout, landscaping, fresh paint, and much more.

4930 Cliff Drive, Capitola

This luxurious oceanfront property in the heart of Capitola is the most affordable oceanfront single family home in Santa Cruz County! This one-of-a kind home is one of only four single family homes located oceanside above the wharf and at the perfect angle to give you panoramic views of the entire Monterey Bay. On clear days you can even see all the way to the point at Big Sur. Spectacular views and easy access to the best parts of Capitola are just a few features that make this home so amazing. Add to that meticulous maintenance, tasteful renovations, and a layout that really maximizes the view and you have a home that is truly a masterpiece.

3 Bedrooms, 2 Bathrooms, 1,288sqft

Listed at $3,999,000

1460 Lockhart Gulch Rd, Scotts Valley

This 1 bedroom home is 730 sqft with a 300 sqft additional dwelling unit that includes a full bath and kitchenette. This home is well maintained and updated with hardwood floors, granite countertops, high ceilings, and two fireplaces. Outside is a partial wrap around deck with a hot tub. It also includes a 24 hour backup battery in case of power outages. It's vicinity near Mission Springs in Scotts Valley puts you in a great commuting location to Silicon Valley

1 Bedrooms, 1 Bathrooms, 730sqft w/ 300sqft ADU

Listing at $749,000

Events in Santa Cruz This Weekend

Santa Cruz Wharf: 13 Days of Halloween

Enjoy 13 days of frightful fun on the Santa Cruz Wharf!

Take part in the Great Pumpkin BINGO Hunt, snap a photo at our scenic photo booth, and enjoy festive Wharf specials ALL 13 days! It all kicks off October 19!

• The Great Pumpkin BINGO Hunt – All 13 Days
• Join the the Great Pumpkin BINGO Hunt!
• Take your Bingo Card to the Wharf any day during the 13 Days of Halloween on the Wharf.
• Find hidden pumpkins on the Wharf. Match their ghoulish image on your bingo card and stamp your card.
• Can you find them all?
• Photo Booth on the Wharf Stage – All 13 Days: Snap a festive photo with your family with the scenic Monterey Bay and Lighthouse as your backdrop.
• Wharf Specials – All 13 Days –  Enjoy fabulous, unique specials from restaurants and gift shops perfectly catered to the Halloween theme.
• Trick-o-Treating on the Wharf – October 31, 3:00 – 6:00 pm. Bring the family to show off your creative costumes and trick-o-treat at Wharf businesses.

October 19 @ 8:00 am - October 31 @ 8:00 pm PDT

Santa Cruz Wharf

21 Municipal Wharf

Santa Cruz, CA 95060

Harvest Festival

Enjoy living history demonstrations, crafts, games, live music, food and more! The event is free to attend. Parking is $10 and helps Friends of Santa Cruz State Parks support the park.

Oct 19 at 11:00AM - 3:00PM

1401 Coast Road

Santa Cruz

95060