Santa Cruz Home Inventory

Santa Cruz County Inventory

May 12^th 2009

These are interesting times in Santa Cruz County with regards to real estate. This is the time of year that Buyers get real active in finding the right property to purchase. Our high season for local real estate happens like the farming season for our fruits and vegetables, from May to September is our busiest time of the year. But this season we have a different pattern as compared to previous seasons.

If you look at the graft below, you will see a snapshot of the housing inventory of Santa Cruz County and there are several market trends that it reveals. This graft shows the number of all active and pending homes in each price range across Santa Cruz County.

First, as you can see at the lower end of the market there are a lot more pending homes verses actives. With lower inventories, if you're a Buyer in this market, you are facing multiple bidders. These properties are for the most part bank owned or short sale properties and most of the potential buyers are first homebuyers or investors. In summary, we have more buyers than available inventory in this market segment.

In the middle and upper segments of the market, you can see we have the opposite situation. We have a lot inventory and fewer buyers. Unless it's a prime beach property that is priced below market, we are not seeing multiple bids. The seasonal demand for beach homes is still a strong driving force and therefore one of the bigger demands in this market segment. In comparison, country homes are being harder hit with much lower demand and higher inventory. Thus Buyers are in a very strong position in this market segment and this pattern will continue through out the year.

So what are the market trends we are seeing:

1. This is still a strong Buyers market, but Buyers will face more competition at the lower end of the market.
2. Beach homes will be in greater demand this spring and summer season with lower prices.
3. Country home inventory is much greater than market demand, making it great time to buy a country home.
4. Bank owned properties and short sales will still be have a major impact on the market for some time to come. (Especially at the lower end of the market)
5. With so much activity and demand at the lower end of the market, the median price of homes will continue to be lower as compared to past years.
6. Overall still one of the strongest buyer markets with near all time low interest rates and growing inventory.

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