A Recap of 2023 Real Estate Trends
In 2023, Santa Cruz County's real estate market faced challenges, recording the lowest number of single-family home sales in over two decades. Despite this, the market maintained relative stability. Rising rates did however put a damper on activity, driving down buyer demand and pushing the median home price 5.6% below the all-time highs of 2022.
Unpacking the Numbers: Steady Prices and Fewer Sales
Throughout 2023, the median sales price hovered around $1,230,000, reflecting a year-over-year decline of 5.6%. The number of sales also decreased by 19%, following a 40% reduction in 2022. Notably, Santa Cruz County experienced its lowest recorded number of sales in history, attributed to the impact of high interest rates. Many would-be buyers remained on the sidelines and sellers found themselves locked in with low interest rates.
Glimpse into 2024: Optimism Amidst Interest Rate Declines
The good news for 2024 is the gradual decline in mortgage interest rates since late October 2023. Industry experts anticipate rates dropping further, possibly reaching as low as 5.75% later this year. As we enter an election season, market volatility may occur, providing opportunities for buyers to capitalize on motivated sellers, especially during the fall.
Going Into 2024
Despite potential market fluctuations, a positive start to 2024 is anticipated. With rates down over 1%, considerable pent-up demand, and increased activity from both buyers and sellers, the real estate market shows signs of improvement.
Looking at January's numbers in Santa Cruz County, positive trends emerge:
- New listings have significantly increased compared to the previous January, November, and December.
- Homes are selling six days faster on average year-over-year.
- More homes went under contract, indicating an uptick in demand.
- Fewer homes expired or were canceled month-over-month.
- Months of inventory hover just over 3 months, signaling more of a balance between a buyer's and seller's market.
- Homes are selling at 97.4% of their list price, a notable increase compared to Q4 of 2023.
- Fewer price reductions both month-over-month and year-over-year.
Navigating 2024 with Confidence
No matter the challenges or opportunities that 2024 brings, I remain dedicated to serving my clients and community, surpassing expectations, and providing excellence at every level.
Let's connect soon and chat about your real estate new years resolutions!