Capitola and Santa Cruz Housing Markets Show Stability

This graph shows both Santa Cruz and Capitola homes - single-family and attached - with at least 2 bedrooms and 2 baths.  We see the Median For Sale versus the Median Sold prices and find that we - like a lot of the rest of the country – have experienced a 24% drop in Median Prices.

This does not mean your home dropped 24%, it means that the price of the homes in the middle of all homes sold has gone down by that much.  This is more a reflection of which segment of the market is selling rather than an individual home’s value.

To be fair, though, values have slipped.  The million dollar home of three years ago could easily be the $800,000 home of today.

But let’s take a look at some reassuring signs.  This is where the “stability” comes in.

When a market shows declining values, we find several things:

Asking prices are way above the eventual sales prices.

Homes tend to sit on the market longer.

There are more homes coming on the market than the sales rate can absorb.

If we adjust for seasonal effects (that is, don’t look at the previous quarter as much as you look at the corresponding quarter from the previous years – Q1 to Q1, Q2 to Q2, etc.) see some very encouraging signs.

See Capitola Homes currently for sale

See Capitola Condos currently for sale

See Santa Cruz Homes for sale over $800,000

See Santa Cruz Homes for sale under $800,000

While (from the graph above) we do not see sales prices as close to asking as we have seen in the first quarter of ’07 or ’08, we do not see much of a change from last year.  This is good!  Let’s hope this is the trough that marks the markets return upward.

As far as the average Days on the Market within these parameters, these numbers have improved dramatically!  The long term average market itme for this area is around 60 days, and that is exactly what we have today.  In the first-quarter of 2007, the average was about 68 days, and in ’08 and ’09 the average got as high as 80-90 days-on-the-market!  This is a big improvement.

Some other signs of stability:

Homes under contract are at the 2007 levels and substantially higher than 2008 and 2009.

Expired listings are down  

The For Sale to Sold homes ratio is roughly the same as 2007, but a marked improvement over ’08 and ’09.

Finally, the best news of all is the Supply vs. Demand data.  While it is slightly worse than 2007, it is much better loking than in the first-quarter(s) of 2008 and 2009!

This is probably the most important indicator of future Real Estate values, because herein lies the reason people will pay more for a home today than they would a year ago – more buyers are looking for fewer homes!  This affects all of the factors I mentioned earlier in this article.

In this environment, homes sell sooner, they sell for more money, and they sell at or even above the listing price.

Let’s enjoy this good news and remember why we live here!  Go and enjoy the waves and the sand between your toes.  If these trends continue, we will all breathe a little easier knowing that sunnier market conditions are ahead!

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