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Keeping you up to date with Santa Cruz Real Estate
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Weekly Market Update
- The hottest zip code in the county this week in terms of the Market Action Index (ratio of inventory/homes selling) remains Soquel (95073) with an index of 51 and a median list price of $2,250,000.
- 33 properties sold in the county this week with an average sale price of $1,603,834.
- There are 472 active for sale properties on the market here in Santa Cruz County. (it was 480 last week). Inventory in the county has stabilized over the last few weeks and will likely decrease until next spring as we head into the holidays.
- Despite affordability challenges, weekly pending sales have held up better than in 2022 and 2023. Although home sales are not robust, they are showing slight improvement year-over-year.
- The stable sale-to-ask price ratio and minimal increase in price reductions suggest sellers are holding firm despite fewer immediate sales. With rates not fluctuating as drastically as in 2022, the market remains steady, with fewer price adjustments indicating sellers’ confidence in market stability.
- Post election it is likely we see a notable increase in market activity as election years always cause a pause in market activity.
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Capitola City Council Aims for Capitola Mall Redevelopment
Two city council members expressed frustration with the mall’s majority owner, Merlone Geier Partners, which has stated that a mall overhaul with new homes and shops remains financially infeasible.
“I’ve been on this council for eight years, and the question people most ask me about is, ‘What’s going on with the mall? Why haven’t we seen anything done with it? Why is this taking so long?’” said Capitola Mayor Kristen Brown. “And every year there’s a new reason that I have to tell them.”
She said the council has repeatedly given Merlone Geier what it has asked for, yet the firm has not moved forward with a project. “The community has waited nearly 10 years, and what we’re hearing just continues to be, ‘Sorry, that doesn’t work for us,’” Brown said during the council meeting.
“I’m disappointed in where we are today with the developer. We have bent over backwards as a council,” said Capitola Vice Mayor Yvette Brooks.
The mall’s redevelopment into hundreds of new homes is part of the city’s state-mandated Housing Element of the city’s General Plan. Capitola must permit 1,336 new housing units by 2031, and more than half of those units are to be rented below market rate for very-low and low-income residents. State authorities set income limits annually.
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The Unexpected Strength of Home Prices this Year
Despite high mortgage rates and weak demand, home prices have remained surprisingly resilient. Nationally, home prices are expected to end 2024 higher than last year, with some momentum going into 2025.
- Rising Mortgage Payments: Although home prices are higher than last year, the cost of owning a median-priced home has recently increased, with mortgage payments jumping 1.5% this week. Payments remain 6% cheaper than last year at this time, as last year saw exceptionally high costs.
- Inventory Stability: Inventory remains steady, with a slight recent decline. New listings have risen slightly compared to last year, but inventory growth has slowed. This year’s inventory build-up contrasts with last year’s rapid increase when rates spiked.
- Sustained Sales Rates: Despite affordability challenges, weekly pending sales have held up better than in 2022 and 2023. Although home sales are not robust, they are showing slight improvement year-over-year.
- Minimal Price Reductions: Price cuts remain stable, defying expectations given the high inventory and extended time on market. With price cuts stable and some sellers holding strong or withdrawing listings, prices have remained firm through the year.
Mike Simonsen, Altos Research October 28, 2024
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-Mortgage Rates Hit 7% One Week Before U.S. Presidential Election: According to national property broker Redfin, a U.S. homebuyer on a $3,000 monthly budget has lost $33,250 in purchasing power over the last six weeks, with the daily average 30-year fixed mortgage rate rising to 7% on October 28, 2024.
-Commercial Real Estate Foreclosures Soar By 48% Nationwide While California Sees A 238% Surge:Commercial real estate foreclosures are surging across the U.S., with foreclosures climbing 48% in September year-over-year. California's numbers are especially striking, with a massive 238% increase, per ATTOM's recent report, as detailed by Business Insider. This spike points to growing pressures in the sector. This trend is likely influenced by rising interest rates and lingering effects from post-pandemic shifts in demand, particularly for office spaces.
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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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The Surprising Resilience of Home Prices in 2024
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Home Prices Defy Expectations: Despite high mortgage rates and a rise in unsold homes, home prices have held strong, contrary to many forecasts. Analysts expected prices to dip in the year's second half, but instead, they are up 6% from last year, showing significant resilience in the housing market.
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Rising Mortgage Costs Impact Affordability: With recent spikes in mortgage rates, the cost of homeownership is rising, making affordability a challenge. Median mortgage payments increased by 1.5% this week, though payments are still about 6% cheaper than they were this time last year.
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Inventory Trends: Inventory slightly decreased this week to around 738,000 homes, marking what could be the peak for the year. Inventory remains about 21% below 2019 levels, with recent storms impacting supply in Florida. High mortgage rates may limit inventory growth, while lower rates could drive demand and reduce supply.
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Stable Market and Sales Activity: Though not strong, home sales have shown improvement over the last two years. New listings and immediate sales are slower than during the pandemic, and homes now stay on the market 24% longer than last year. Pending sales remain steady, reflecting a more stable market compared to recent years.
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Price Stability and Seller Strength: The stable sale-to-ask price ratio and minimal increase in price reductions suggest sellers are holding firm despite fewer immediate sales. With rates not fluctuating as drastically as in 2022, the market remains steady, with fewer price adjustments indicating sellers’ confidence in market stability.
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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. | |
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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
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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 $699,000
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Events in Santa Cruz This Weekend | |
West Cliff Day of Dead Outdoor Market
Come enjoy our West Cliff Day of Dead Outdoor Market with unique artisans and food trucks while taking in the spectacular view of the ocean.
This one of a kind market will be held in Light House parking lots along West Cliff Drive in Santa Cruz. This is always a popular spot for locals and tourists, as it over looks the famous Steamers Lane surf spot .
The market will feature hand crafted gifts and admission is FREE!
We will also be giving away free tokens every hour to rando shoppers. The tokens can be used towards any vendor of your choice. So come down and get your free gift
Nov 2 at 9:00AM - 4:00PM
701 West Cliff Drive
Santa Cruz, 95060 United States
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At Collins Properties we value relationships over transactions. It doesn't matter to me when you buy or sell. My goal is to help you when the time comes.
My Message to You:
This email is created personally by me every single week and hopefully provides value for you. Your info will NEVER be sold or given away for any reason. Thank you for reading this market update. This is created by yours truly and is not some "canned" data you get elsewhere.
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If you have any questions or would like to schedule a viewing, are in need of renovation guidance, would like to sell your home, or are just in need of a good plumber, feel free to call or email me anytime...seriously
Jesse Collins
831-227-9987
Email Me
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