YOUR GUIDE TO THE MARKET, HOMES & LOCAL LIFE

Guiding you home with Aloha

Opening the Right Doors, Not Just Any Door

Two markets, one county.

Santa Cruz County held its footing again this week. Prices, days on market, and inventory across our neighborhoods are moving in the same steady rhythm they've held for weeks. Aptos, Capitola, and Scotts Valley single family homes are all trading briskly, most in the forty five to a hundred day range, and pending sales continue to close at healthy numbers across the county. If you've been waiting for signs of panic in our local market, you won't find them here. Buyers and sellers who are ready are still getting deals done.

But there's a bigger story unfolding nationally, and it's worth understanding, because it explains a lot of what's happening at the edges of every market, including ours. I caught an interview this week with Compass CEO Robert Reffkin on CNBC, and he put words to something I've been watching for months. There isn't one housing market right now, there are several, and they're moving in opposite directions. Homes priced between a hundred thousand and two hundred fifty thousand dollars are down about ten percent nationally, while homes at a million dollars and above are actually up four percent. The reason comes down to who's buying. The entry level buyer usually needs a mortgage, and with rates now above seven percent, that buyer pool is shrinking fast. The buyer at the top of the market is often paying cash, and with the stock market also at all time highs, that buyer has more purchasing power than ever, rate hikes or not. Nationally, forty two percent of homes on the market have taken a price cut, the highest share in nearly ten years, almost entirely concentrated in that lower, rate sensitive tier.

I got a real, live example of this dynamic just this week. A woman reached out to me about selling her condo in Mountain View, listed at six hundred fifty thousand dollars. As we talked, I learned she already has an agent and is currently on the market, so I pointed her back to keep working with her own agent, and let her know I'm here if that changes. But her situation is a textbook illustration of what Reffkin was describing. She's priced right in that lower band, where rising H O A costs on top of a seven percent plus mortgage rate are quietly pricing out the very buyers who'd normally be competing for a home like hers. It's not that buyers don't want it. It's that the financing math has gotten harder for exactly the people who'd be raising their hand.

The takeaway for Santa Cruz County sellers: know which tier you're in before you price your home. If you're in the entry level range, today's market rewards patience, sharp pricing, and flexibility more than it did a year ago. If you're above that line, buyers are still moving with confidence, and cash is playing a bigger role than most people realize. Either way, understanding which market you're actually in changes the entire conversation.

Loan options worth knowing.

Conforming loan limit increase. Santa Cruz County is now one of ten California counties sitting at the maximum twenty twenty six conforming loan limit, one million, two hundred forty nine thousand, one hundred twenty five dollars, up from one million, two hundred nine thousand, seven hundred fifty. That means more homes in our one to one point five million dollar range can now be financed conventionally instead of tipping into jumbo territory, often the difference between an easier approval and a stricter one.

Five percent down on multifamily. Fannie Mae now allows just five percent down on owner occupied two to four unit properties, down from the previous fifteen to twenty five percent requirement. This opens up house hacking and multi unit ownership to more buyers.

New condo lending rules. Fannie Mae and Freddie Mac eliminated their limited review shortcut for condo financing this year. Condo buildings now require a full financial review, reserves, insurance, budgets, before a loan qualifies. If you own or are considering a condo, ask your H O A about its reserve funding. It can now affect whether buyers can finance your unit.

Worth a conversation with your lender if any of this applies to your situation.

Snapshot of last week in Tahoe

The Spirit of Aloha Real Estate
Opening the Right Doors, Not Just Any Door

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Disclaimer

Market statistics are for single-family homes. Weekly medians can fluctuate depending on which properties are closed. Townhomes and condominiums are not included.

Data sources: MLS Listings Inc. and Altos Research,