We are initiating coverage of the Santa Cruz real estate market to include East Santa Cruz (MLS are 42), West Santa Cruz (MLS are 43) and Live Oak (MLS area 45). Each month, we will look at the activity here and discuss developing trends.
In general, the northern California real estate market has been moving toward a more balanced state. For the past few years, sellers have had the upper hand, as buyers aggressively bid on properties, driving prices rapidly higher. The current market is more normal, with buyers being more discerning and willing to take their time.
Santa Cruz prices did not escalate as rapidly during 2015 as some other parts of northern California but the price increases have been fairly steady. Over the past eight months, year-over-year increases in the median sales price have averaged 7% a month, compared to 8% during the same period in 2015. The price per square foot has risen faster this year, however, (11%) than last (4%). Homes have consistently sold for about their list price, on average since the beginning of 2015.
Inventory has been rising steadily this year, from a low of 78 homes at the end of December to 145 at the end of August. Sales have been up and down during that period and have averaged about 34 a month.
Median Sales Price
August’s median sales price was $885,000, 3% higher than July’s $860,000 and 5.6% higher than August 2015’s $849,500. The average homes sold for 99.6% of the list price in August, the first time since this year the ratio was below 100%. It was 100% in July and 101% in August 2015. The price per square foot fell $12 to $646 in August, which was still $55 higher than a year ago.
There has not been a consistent trend in closed sales this year. 58 sales closed in August, the most since July 2015. 31 sales closed in July of this year and 40 in August 2015.
For Sale vs. Pending
Inventory increased 15 units in August, form 130 in July to 145 in August. That was 22 fewer homes than were on the market a year ago. Pending sales increased from 31 in July to 43 in August, compared to 40 a year earlier. Inventory relative to pending sales fell from 4.2 months at the end of July to 3.4 months at the end of August. A 4.2 month supply was on the market at the end of August 2015.
Days to Sell
The sales that closed in August were listed for an average of 32 days, compared to 25 in July and 37 a year ago.
Analysis by Price Range
We will look at the market in three separate segments (homes priced under $800,000, $800,000 to $1,199,999 and $1.2 million-plus). 29% of Santa Cruz’s inventory and 43% of its pending sales have been for homes priced below $2 million during 2016. 41% of inventory and 40% of pending sales have been in the $800,000 to $1.2 million price range. 31% of inventory has been priced at $1.2 million-plus. However, only 16% of pending sales have been in this segment.
At the end of August, 36 homes priced under $800,000 were actively listed, making up 25% of the total. That was two more homes than were on the market at the end of July. 13 sales went pending during August, three more than in July. Those 13 sales were 30% of all sales. Supply fell from 4.2 months at the end of July to 3.4 months at the end of August.
$800,000 to $1.2 million
The inventory of homes in the $800,000 to $1,199,999 increased from 48 at the end of July to 57 at the end of August. Pending sales also increased, from 12 in July to 19 in August. This segment accounted for 39% of inventory and 44% of pending sales. A 3.0 month supply was on the market at the end of August, down from 4.0 months at the end of July.
$1.2 million or over
36% of Santa Cruz’s inventory at the end of August was priced at or above $1.2 million, while 26% of pending sales during the month were in this segment. 11 sales went to contract during August, two more than in July. 52 homes were for sale at the end of August, four more than at the end of July. Supply dipped form 5.3 months at the end of July to 4.7 months at the end of August.
Check out these other Real Estate Market Conditions Reports for August 2016: