Santa Cruz County Market Update – August 2022
Below is the Santa Cruz County Market Statistics for the month of August ’22. Here are the highlights:
– Active Inventory started its yearly decline after peaking in July. Active inventory is down 4.04% from the month prior.
– The median SFH sales price increased to $1.30M from $1.25M the month prior. August ’22 median home price is up 3.8% to August ’21.
– Number of Sales increased by 22.7% from July but is down 32.7% from August ’21.
– Days on Market in August ’21 was 17. Days on Market in August ’22 was 29.
Shift happens quickly. Inflation and the government’s desire to combat it have certainly had an impact on the Real Estate market. While the market is different than last year, it doesn’t mean it’s not strong. The intense demand and consistent up-bids that occurred post-April ’20 were certainly not sustainable long-term and it took interest rates to pause the frenzy. That said, if you compare last year to this, the Median home price is actually up year-over-year. Homes are taking longer to sell and the price-to-list ratio is flirting below 100%. The price per sq/ft is up 3.1% compared to last August. On the supply side, new listings way underperformed historical August averages. The 176 new SFH listings in August were the second lowest in 12+ years (behind only August of 2020). The main culprits for low supply are higher interest rates and taxes (property taxes and capital gains tax). Each discourages house swapping. On the demand side, we seem to have found a level. The median home price bounced between $1.25M and $1.3M throughout the month. Buyer expectations have started to adjust to the times and when synergy occurs between expectations and reality, prospective buyers become real buyers. While some promising deflation signs occurred last month, this month’s data forced adjusted expectations. It’s safe to assume that raised rates will continue through the end of the year.