Santa Cruz County Year in Review

[Dax Nollenberger]

What the crazy year 2021 was in the real estate market. Despite continued pandemic disruptions, the Santa Cruz County real estate market thrived. The median home price, for the first time, averaged over $1MM. In fact, the median home price for 2021 was $1.2MM. Up 23.08% from last year. For average home prices, the story was the same. In 2021, the average home price was $1.324MM, 17.89% higher than the year before. Days on Market was also a record low (23). Months of inventory, which is a measure of how quickly supply would run out if no more homes came on the market, was 1.14 months (another record low). 

What's even more shocking, there were a total of 2363 listings in 2021, a record low. For comparison, there were 10358 in 2011! As for demand, it's never been higher. The number of sales hit a 10 year high of 2086. 

In Layman's terms, record lack of supply and high demand! 

What happens in 2022? 

My opinion, much of the same. We have seen an 11+ year decline in supply and an increase in demand. There are too many barriers to new supply. Regulations, zoning, capital gains on appreciated homes, lack of land, lack of labor, increasing labor costs, and increasing material costs all contribute to a lack of supply. 

What do you think happens in 2022?