Santa Cruz Real Estate Sales Data - April 2008
May 10, 2008
Well, the numbers are in, and we’re looking better. For those of you who are really interested in knowing what’s going on with real estate sales in Santa Cruz county, I want to remind you that I have a great page on my web site that gives you all kinds of ways to look at Santa Cruz Real Estate Sales Data. Also, I offer a monthly Santa Cruz Real Estate newsletter which offers an analysis of what the numbers mean, and this month’s edition just hit the inboxes of subscribers.
OK, maybe the numbers aren’t grrrrrrrreat! like our friend Tony the Tiger would say. But they’re certainly better than what we’ve seen lately. What’s the scoop? For Santa Cruz county as a whole, sales and prices of single-family homes rebounded nicely in April compared to March. County-wide, there were 103 sales in April ‘08, compared to just 70 in March ‘08. Also, the median price of those homes rose 6.1% from March.
Comparing one month to the month before it isn’t a terribly useful exercise, however. After all, we are approaching the peak selling season, so it’s no surprise that sales numbers are up. However, it’s a very good thing that sales numbers aren’t down - that would be most unwelcome news.
It is, perhaps, more interesting to compare April ‘08 to April ‘07 - what do we see there? There, we see that the median price (again, county-wide) of single-family residences is down 11.8%, and in April last year, 132 homes were sold - so about 25% fewer homes were sold this April. The numbers are considerably worse for condos, but so few condos were sold (just 19 county wide) that it’s difficult to really gauge what’s going on in that market price-wise.
One thing I’d like to point out here is what’s happening in Watsonville. There is an enormous amount of pending home sales in Watsonville - homes that are under contract, but the sales have yet to close. Many/most of these homes are foreclosure properties - there are some staggering bargains to be had. It will be interesting to see what happens to the sales numbers and median prices when these sales close.
I really encourage you to subscribe to my newsletter. I’ve got an interesting article in there this month about the problem with the foreclosure numbers - things are perhaps not so bad as they seem. Of course, if you are one of the many unfortunate homeowners contributing to the swelling statistics of foreclosure numbers, if things get really bad, you can always just walk away.
Posted by SantaCruzBroker at 8:30am
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Santa Cruz Real Estate Market Data - Revisited and Revamped!
April 14, 2008
I can’t tell you how many times a day people write to me and call me just begging to know the latest real estate sales data for Santa Cruz county. It happens so often that some days, it feels like all I do is field calls about how many condos sold in the San Lorenzo Valley in Q1 ‘08.
OK, I’m being facetious. In fact, that hardly ever happens. More often than not, when people call me out of the blue it’s because they either a) want money or b) want to buy a house, not necessarily in that order.
The fact is, though, that many people in our beautiful area do, from time to time, have more than a passing interest in the real estate sales data in the Santa Cruz area. And for those of you who do, I have something I’d like to show you.
In order to legitimately call SantaCruzHomeBroker.com the best site on the internet for information about Santa Cruz Real Estate, I feel that it’s important to have as much information about the local real estate market as possible. For this reason, I have had for some time a set of pages with sales data.
I’ll come clean. I don’t laboriously compile this data and make it available for you. That’s what Gary Ganges does, and he’s very good at it. Instead, I pay a small company who does it for me, and they do a far better job than I could ever do. What I do is I integrate that sales data into my web site. And, this nice small company has recently upgraded their offering considerably. Of course, they have also upgraded their pricing considerably as well - not too happy about that part, but truth be told, I spare no expense to bring you the best Santa Cruz Real Estate web site in creation.
From the looks of it, though, the upgrades appear to be worth every penny - nice and heavy on the use of Flash, so it must be good! Check it out:
Santa Cruz Real Estate Market Data
Spend a few minutes checking it out. One that I’d like to highlight is that you can now set up the system to send you your own custom market data report. You just configure the report how you want it - you choose the county, city, property type, date range, etc. - and then click “View Report.” Next, you can click “Save Report.” You will need to create an account to save your report and have it sent to you - but don’t worry that I’ll spam you mercilessly to death after that, because I won’t.
Posted by SantaCruzBroker at 7:04pm
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February 2008 Santa Cruz Real Estate Sales
March 14, 2008
Oy vey. Ooof. What’s a good thing to say when you’ve just managed to crawl out from under a ton of bricks that got dropped on your head? I have been slammed. Slammed, I tell you! But you probably won’t find that nearly as interesting as I do. A lot’s been happening…
Like what’s up with that Eliot Spitzer guy, anyway? There’s a guy you think would know better. You’d think. It just goes to show, the world is just full of surprises.
One thing that’s going to come as a surprise to some folks is the February real estate sales data here in Santa Cruz county. The bottom line? Business is up. That’s good news, but if you think about it, you’d realize it couldn’t actually get much worse, and even with this improvement, we’re really just kind of skipping along the bottom. If you don’t already, I invite you to subscribe to my Santa Cruz real estate newsletter, which comes out once a month, or just cruise over to my page of Santa Cruz Real Estate Market Data, which is updated monthly.
In case you’re too lazy to do either, let me summarize it into a tasty new chunklet: Santa Cruz County home sales rose 9.1% in February, woo hoo! That’s compared to January, of course. Year over year, home sales are off 46.7% from February of 2006. And, of course, I don’t have the hard data handy to back this up, but I’m going to go out on a limb and say that I’d bet most Februarys have at least 9.1% more sales than the Januarys that precede them. So although this 9.1% sales increase is good news, mostly it’s good because if it were a decrease, that would have spelled some serious trouble.
That 9.1% is the sales volume - that is, the number of units (single-family residences - yes, your home is just a unit, like a Big Mac or a jar of Ponds Cold Cream) sold was 9.1% higher in February than in January. But if you already own a home, you may be more interested in knowing about home prices- is your home worth more, or less? Good news, good news - median home prices rose a rockin’ 11.9% from January! But don’t pop the champagne corks quite yet - prices are down, county-wide, 5.2% from February 2006.
Of course, all markets are local, so it doesn’t do a whole lot of good, really, to look at the county as a whole. But we’re Americans (a lot of us, anyway), and we like those tasty news chunklets, so probably you’d be satisfied with just knowing that one glib statistic. But if you demand more - if you are, say, a reader of The Economist - you might want to know, say, how Soquel is doing? The median price in Soquel is up a whopping 4.2%! Whereas if you’re in Watsonville, alas, the median price is down 28.7% from February in 2006. But that’s good, the rate of decline is slowing there - it was down about 40% for all of 2007.
I hope to get back to a more regular update schedule here on the blog - I need to learn to walk around the dangling net with the ton of bricks snared inside. Note to self.
Posted by SantaCruzBroker at 11:26am
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Santa Cruz and Mega Region Real Estate
March 07, 2008
My brother never tires of sending me links to articles about why real estate is such a rip-off, that it’s much smarter to rent and invest in the stock market. But today, he sent me a link to an article that talks about why it is that Bay Area real estate prices (and, by extension, Santa Cruz real estate prices) defy the normal rules that most other markets play by
[From Think globally, live locally]
…that despite all the predictions about virtual offices and globalization rendering geography irrelevant, where you live still largely determines your destiny. Though theoretically we should be able to work just as efficiently from, as he puts it, “a ski chalet in Aspen or a house in Provence as an office in Chicago,” the facts suggest that the rise of a handful of global megaregions — centers of both creative innovation and economic productivity — has made place more central to people’s lives than ever.
Yeah, I know - Santa Cruz isn’t a mega-region. It’s a funky little quasi-hippie beach town with a behemoth of a University that sucks up a lot of resources and clogs our rental market with students who abuse the property and cause no end of hassle for the neighbors what with their endless parties and pot smoking and Che Guevara posters clearly visible through the windows.
But, the reality is, we are right on the outskirts of a mega region. Silicon Valley. We are where a lot of folks who live in the valley would like to live, were it not for Highway 17. There is no doubt that Santa Cruz is an extremity of this mega-region known as the San Francisco Bay Area/Silicon Valley - and I invite you to consider the possibility that this is not a bad thing. It is, after all, one of the great bastions of hope for the US Economy, an international success story with few rivals in the world.
Real Estate is a long term investment. Forget about a quick flip, unless it’s something you really understand and are sure you are buying at the right price to do it successfully and profitably. But if you are in it for the long term, I still believe (regardless of what my brother says) that it’s a smart thing to hold real estate in Santa Cruz. Or even San Jose.
Posted by SantaCruzBroker at 5:42pm
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Real High Stakes Poker, Round Two
February 25, 2008
I had an escrow close last week, but we were barely able to keep the deal together. I alluded to this deal in my earlier posting about Real HIgh Stakes Poker a few weeks ago. It may not surprise you to read that a deal which was hard to put together was hard to keep together, but listen to this…
We were well on our way to closing. The seller had actually already signed the documents she needed to, all that was left for the buyers to go to their friendly neighborhood First American Title Company office and do their signatures, and then we’d just sit around and wait for those fat commission checks to come rolling in. Then, late one evening, my phone rings. It’s the buyer’s agent. It seems we had a problem.
“A new material fact has just come to light,” she began. “It significantly affects the value of the property.” Now, the buyers had already released their physical contingencies. They had already signed off on the property, saying that after having had ten days to investigate it, everything was kosher. But now, on the eve of the day when they sign their loan and title documents, a new material fact had apparently come to light. Wouldn’t you know it.
“Oh?” I asked, “What’s that?” The agent replied, “Well, in the MLS, you listed the property as 1690 square feet. When the appraiser measured it, he came up with only 1505 square feet.” It seems that the buyers had gone ballistic, had threatened to file a lawsuit, to sue us for misrepresentation or fraud or something…but that the buyer’s agent had calmed them down to the point where all they wanted was a discount of $15,000.
Well, that’s a bummer. The truth is, I had no idea how many square feet the house is. I had read several different figures from a variety of different sources, and come up with 1690. It “felt” like about 1690 to me, too. Also, the carpet guys and the hardwood floor guys, guys who measure houses all day long, none of them ever said anything to me like, “Hey, you really think this house is 1690 square feet? It feels smaller than that to me.”
However, right in the agent’s private comments on the MLS, it said quite clearly: “SF Approx.” Not only that, but the buyers had submitted a Buyer’s Inspection Advisory along with their offer, a signed document which reads, in part:
YOU ARE ADVISED TO CONDUCT INVESTIGATIONS OF THE ENTIRE PROPERTY, INCLUDING, BUT NOT LIMITED TO THE FOLLOWING:
…
2. SQUARE FOOTAGE, AGE, BOUNDARIES: Square footage, room dimensions, lot size, age of improvements and boundaries. Any numerical statements regarding these items are APPROXIMATIONS ONLY and have not been verified by Seller and cannot be verified by Brokers.
You see, the seller really isn’t on the hook to provide a precisely accurate measurement of anything. And, what’s more, if you take three different appraisers and have each measure the house, each one would probably come up with a slightly different figure.
Now, this measurement of 1505 square feet came from the appraisal. The buyer (or his agent, or lender) orders the appraisal, and the buyer pays for it. The buyer is entitled to see it, it is his property. The buyer has a specific contingency on the contract called the appraisal contingency - if there’s anything in the appraisal that does not satisfy the buyer, the buyer can back out of the contract. However, the buyer had specifically released his appraisal contingency as well. Why, if this square footage was so important to the buyer, did he not bother to read his appraisal which he paid for, before releasing the contingency?
And perhaps the biggest weakness in the buyer’s ploy to get a $15,000 discount was that even at 1505 square feet, the home had appraised for at least the purchase price. So how, then, is a $15,000 price deduction justified?
The answer is that it’s not justified. To my eyes, this was a last-minute ploy to chisel some more cash out of the seller. Not such a bad ploy, really, but a bit unfortunate. It would have been more effective to use this before releasing the physical and appraisal contingencies, because as I said, the seller had already signed off and was thinking that it was basically a done deal. Pulling something like this at the last minute kind of left a sour taste in everyone’s mouth.
The buyers had sent over an addendum, asking for the $15,000. After consulting with my client, I informed the buyer’s agent that it wasn’t going to happen, no way would my client be signing that addendum, and that she needed to talk some sense into her client.
Alas, the word came back from the buyer the next morning, in the form of a cancellation of contract form. I shipped that off to my client the seller, and in a few hours I had it back, and forwarded it on to the buyer’s agent, saying, “OK, here’s the cancellation of contract. I’m going to let you send it in to the escrow company, if that’s really what your client wants to do.”
Heh. I had a feeling that’s not what the buyer really wanted to do. I think the buyer really wanted to buy the house (it was a good house, good location, good price). And, sure ’nuff, a few hours later I got a phone call from the buyer’s agent. “Seb, we’re gonna hold off on sending that cancellation to escrow. I’ll let you know later on in the day.”
Well, a whole lot more drama ensued, which I won’t go in to. In the end, the buyer’s agent chipped in $2,500 of her commission, and we had to chip in $2,500 of our commission - except that our client, bless her heart, signed a separate agreement and wrote my brokerage a check after the close of escrow, giving us the $2,500 back.
What a crazy business. Ya win some, ya lose some. After all the hard glares across the poker table I’m glad we won this one.
Posted by SantaCruzBroker at 7:44pm
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