Santa Cruz Homes – Home Equity Is On the Rise!

Posted by Lauren Spencer on Monday, March 22nd, 2010 at 11:01pm.

The news is everywhere – and it’s good! Those who own or want to own Santa Cruz homes can take a deep breath.  Home equity is on the rise, according to a recent study by, an online real estate valuation researcher.  And, Federal Reserve economists agree. Although home equity isn’t what it was three years ago, it’s on the rise.

The Fed’s most recent “flow of funds” survey indicates that the net equity of national homeowners grew by almost $1 trillion over the first three quarters of 2009, and rose further by $418 billion between June and September of last year. Compared to before the bubble popped, that’s really not that impressive. However, after three straight years of steadily dropping equities, it could signify the long awaited end of the housing crash.

In the housing markets of several cities, negative home equity is dropping; Los Angeles, San Francisco, Miami and Seattle are just a few examples. Good news for those with Santa Cruz homes, but even better news for some of the hardest hit cities, such as Phoenix, AZ, and Fort Myers, FL.

This is the best news yet for those trying to sell their homes, especially with most residential real estate markets' busiest season coming up. Rising home equity means the high possibility of more interested buyers. As well, a few things have been happening over the past couple of months that just might be the beginning of a run on housing sales:

 Median home prices are rising slowly but surely; potential homebuyers are getting a little more serious. Rather than wait for a cheaper house, they’re starting to realize that it might not get any cheaper.

• The housing supply is shrinking. At the peak, we had 11 months worth of back supply. By the end of 2009, we were down to 7.2.

• 30 year fixed mortgages dropped to the lowest point of 4.95% (median), and are now slowly on the rise. Buyers waiting for lower mortgage rates – just like those waiting for lower housing prices – are getting serious about buying now.

Last and most importantly, consumer confidence is growing – something we badly need to get the economy on track.

What’s the moral of the story? If your house is one of the Santa Cruz homes up for sale and you’ve been sick with worry that it might not get taken off the block, take a deep breath. Things are getting better and, if you hang in there, may end up better than you hoped.

If you’re trying to sell your home, I can help. Call me at 831.662.6522 or email me at for more information.


Most recent flow of funds survey

residential real estate markets

30 year fixed mortgages


About Lauren Spencer

Award-Winning Santa Cruz REALTOR®

Lauren Spencer is your local real estate expert, specializing in Santa Cruz real estate and surrounding communities—this is where she lives, works, and plays too. Let her know your questions about the community and county and she'll be happy to fill you in on all you want to know! Lauren Spencer has consistently been voted best local REALTOR in Santa Cruz and is always happy to offer her advice and expertise. Call her at: 800.226.4717.

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