The Santa Cruz real estate market is making headlines again. A few weeks ago, the news was that the median home price in Santa Cruz county had dipped below $800,000 for the first time in 15 months. But a fresh look at MLS data reveals that the Santa Cruz median home price hit $920K in March 2018. This is believed to be the highest median home price ever recorded in Santa Cruz county.
Here’s a quick break-down of the March 2018 Santa Cruz Real Estate Market data:
- $920,500 median single family home price (+12.3% vs. $820,000 a year ago)
- 132 Homes sold (+16.8% vs. 113 year ago)
- 37 Days on Market Average (-27.5% vs 51 DOM a year ago)
- $647/sf Average (+29.4% vs. $500/sf average a year ago)
- 210 New Listings hit the market (+2% vs. 206 a year ago)
When the news hit a month ago that the January median price had dipped below $800K for the first time in over a year, I cautioned people that one month does not make a trend, it could easily be an outlier. Likewise, March’s $920K number could also be an outlier. Certainly, we are seeing a considerable amount of volatility in the market.
Santa Cruz is 6th Hottest Housing Market in the USA
Last month we reported on the 20 hottest housing markets in the entire United States. Last month, Santa Cruz came in at #11. This month, Santa Cruz is 6th hottest real estate market in USA. This is according to a new article in Realtor Magazine. Once again, San Francisco as ranked as the #1 hottest market in the entire USA, and 11 of the 20 hottest housing markets in the USA are in California.
What’s making Santa Cruz and these other California markets so hot? “Never in history have there been more eyes on fewer homes than today,” says Javier Vivas, director of economic research at realtor.com®. Or, put another way: it’s the law of supply and demand. We are still experiencing painfully low supply and crushing demand for homes in the state. You can feel the heat by looking at that drop in days on market for Santa Cruz county, with homes selling 27.5% faster in March this year compared to a year ago.
The Bottom Line
The Santa Cruz real estate market continues to heavily favor sellers, with Zillow rating the market as 9.4 out of 10 (or “very healthy”). Homes in Santa Cruz are increasingly being sold to well-paid Silicon Valley employees, seeking better schools, cooler climate, and lower home prices than they find in Santa Clara county. Would-be buyers in Santa Cruz are likewise being pushed further south and east, spilling into the housing markets of north Monterey county such as Salinas, Prunedale, Castroville, Marina, and Seaside.
While the market continues to climb, the January drop in prices below $800K should sound a note of caution for home sellers. The market does appear to be primed and ready for a hot Spring and Summer selling season, and 2018 looks to be another record-setting year. The big question is, will 2019 be any better?