Best Santa Cruz Communities for Investment Properties

Posted by Lauren Spencer on Wednesday, March 13th, 2019 at 2:35pm.

If you're looking for an investment property in Santa Cruz, then you're looking in the right place. Whether you're looking for a rental, or vacation property, or second home, the Santa Cruz real estate market has a lot of opportunities for building your wealth.

However, as with any property investment, the costs and risks are significant, so you'll want to make the decision carefully and based on the best information available. Still on board?

Here we'll discuss some of the factors to consider when looking for an investment property in Santa Cruz, as well as the best areas to go for.

Click here to jump directly to the list of recommended investment communities around Santa Cruz, or keep reading for more information on buying investment property.

Buying Investment Property Around Santa Cruz

As mentioned, there are a lot of reasons why buying an investment property in Santa Cruz is a good idea...

Santa Cruz is a popular bedroom community, university town, and a holiday destination. In any other place, just one of these would be enough to sustain a healthy rental market, but in Santa Cruz you get all three. Combine that with a history of rising property values and you have a recipe for wealth creation.

So, Santa Cruz as a whole is great, but what should you look for in an individual property? Well, there are the tried and tested methods for getting great return-on-investment from real estate:

  1. Buy a cheap property in a good area
  2. Buy a good property in a cheap area (one that shows promise)
  3. Buy where property values have been steadily increasing for a long time

Any one of these strategies could put you on the path to success, but apart from that, there are some other things to consider when investing in Santa Cruz real estate:

  • Generally, smaller and newer homes are better as these present fewer risks
  • If you're managing the property yourself, keep it close to your primary residence for convenience
  • Consider long-term rentals to exploit the low supply and high demand, and to avoid furnishing costs and anti-short-term-rental laws
  • And finally, ask yourself: is this somewhere that I'd want to live?

Now you're probably wondering about the best areas for property investment in Santa Cruz. We are here to help, so here's a list:

Santa Cruz Investment Communities


This small community is the gateway to the San Lorenzo Valley, beloved by tourists and residents for its history and many outdoor attractions.

Residents in Felton have a good head start for commuting north towards San Jose and Silicon Valley, and are less than 10 miles from the University of California Santa Cruz campus to the south.

Beautiful surroundings and tourism are guaranteed to keep this area desirable for many years to come.

Scotts Valley

Scotts Valley is similar to Felton, lying in a valley north of Santa Cruz, but it's much smaller and offers a more direct route to both San Jose and downtown Santa Cruz. A diverse mix of affordable property types, excellent amenities, and fantastic shopping make Scotts Valley a great place to live and a great place to invest.

Santa Cruz Beachfront

Taking into account the beachfront communities of Westcliff, Seabright, and even all the way to Pleasure Point, it doesn't get better for vacation rentals in Santa Cruz than this.

Santa Cruz's beach and beach-side attractions are famous in California and attract tourists from far and wide. The Santa Cruz Boardwalk and Wharf are both highlights, as are the many fashionable eateries and boutique stores that line the streets.

While these properties may some of the most expensive real estate in Santa Cruz, there's definitely a reason for that, since the demand is real and consistent.

West Santa Cruz

In the shadow of the University of California Santa Cruz campus, the homes for sale in west Santa Cruz are a haven for students and those who work at the university.

As such, there will probably always be a demand for rentals here. Combine that with the awesome views and easy access to beautiful parks, the downtown area, and shoreline drives, and you'll find a great place to live in west Santa Cruz for anyone.

Investing in Santa Cruz Real Estate

Ultimately, your choice to invest in Santa Cruz residential properties will depend on your needs and capacities. Can you afford the time and money to be a landlord? If you plan on using the property as a vacation home, what are your vacation schedules and activities?

If you're already a Santa Cruz resident, then you already have the advantage of local knowledge and being able to manage a property yourself. But, either way, it pays to get some professional advice and experience on your side, which is why it's key to find a real estate agent who can help you make the right property investment decisions.

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