Hey everyone – what about this weather we’ve been having? Stunning doesn’t begin to describe it. OK, well, it begins to describe it, but it doesn’t get very far. I see that it’s been another 8 days since my last blog entry, and I feel muy avergonzado. I guess the weather has just been too nice, or I’ve been too busy, or something! My head has been elsewhere, but now…now I’m back!
I don’t know if you saw this, but last week, the Good Times Magazine had on its cover: Unreal Estate – a story about how purchasing a home in Santa Cruz for most people is “a dream deferred.” Naturally, this is the sort of article that really grabs my attention, and had I know in advance they were putting out an issue like this, I would have probably bought some extra advertising in that week’s issue! I need to talk to my Good Times ad rep about this…! (are you reading this, Rya? If so let me know and drinks are on me!).
The Good Times usually writes some pretty insightful articles, so I was very much looking foward to reading what they had to say about unreachable real estate. Alas, there was precious little insight to be had in the article. It turned out to be a story about the angst people suffer from regarding how they’ll “never” be able to buy a home in Santa Cruz, or that if they were to do so, it would decrease the quality of their lifestyles (no more surfing trips to Costa Rica for a while, that kind of thing).
I dunno, I was kind of expecting more. Some numbers, maybe? I mean, the price of real estate has been a sore point amongst locals here for years and years. Why didn’t everyone buy in 1998, 2000, 2002, when real estate was much cheaper than it is today? Well, there’s price, and there’s affordability. Back then, while the real estate cost less, the loan programs weren’t as, errr, creative as they are today, and big down payment amounts and high interest rates made the homes unaffordable, even if prices were much lower. Today, with $0 down, low rates, interest only mortgages and such, the barriers to getting into a property are less, but payments are higher than before, because the loan amounts are so much larger. What I would like to see, though, is some reporting about how things were, say, 10 years ago – what % of income went to housing payments, etc. I think, perhaps, people are yearning for a golden time that hasn’t really existed for several decades.
I’ve been talking to a lot of people lately (more so than usual!) about what’s to do be done about rising real estate prices. The fact is, Santa Cruz County is pretty anti-growth. It’s a winning policy – we are only one of two counties that has had a *decrease* in population in the past 5 years. And why are folks leaving? The high price of housing, coupled with relatively few jobs. Of course! And how is it that prices keep rising, as the population declines? After all, the law of supply-and-demand dictates that if there’s less demand for a commodity, prices should drop. So just how is it that prices keep rising?
Santa Cruz’s slow/no-growth policy has meant that the housing stock in the county has not kept pace with the growth of the state of California as a whole. Actually, it hasn’t kept pace with the nation’s or the world’s growth. And, sadly, all evidence to the contrary – Santa Cruz does not exist in a vacuum, in a different world, from everyone else. And, alas, everyone else is permitted to buy property in Santa Cruz. Everyone else (those “over the hill” folks, primarily) really likes Santa Cruz for the same reasons we like it…and THEY have those nice high-paying techie jobs which we can’t seem to attract in great numbers of here…
Sigh. It seems to me that the only way to get out of this situation is through growth – smart, well-managed, forward-thinking growth. Do we have that in us as a community? Not that I’ve seen – we are really good at burying our heads in the sand. The price we pay for this is reflected in outrageous housing costs – and that looks like a price we are ready to accept as a community.
Top Posts & Pages
- The Anchoring Effect and Asking Price in Real Estate
- Property Tax Rates for Santa Cruz Real Estate
- Redman House Apple Annual 2008
- The Endowment Effect in Real Estate
- Multiple Offers on Santa Cruz Real Estate
- How to Sell Your House for More Than It's Worth
- The Worst Kitchen Layout Ever
- 7 Tips for Selling a Home with a Solar Power System