A Conversation with Pete Cullen, Realtor GRI, E-Pro with Bailey Properties in Aptos, California

Since 1972 I have had the extreme good fortune of being able to call Santa Cruz, California my home. I moved to Santa Cruz in ’72 to attend Cabrillo College, our local community college. I have lived here ever since and love it!

 

 

 

The town of Santa Cruz is located on the Monterey Bay 70 miles south of San Francisco and 40 miles north of Monterey and Carmel on State Highway 1, the Pacific Coast Highway. To the northeast is Los Gatos and the Silicon Valley, a 30 minute drive through the Santa Cruz mountains on Highway 17.

 

Highway 17 cuts through the Santa Cruz mountains on its way to Silicon Valley. This road offers great views into the valleys below as well as a serene drive through the area’s famous redwoods.

 

 

History

Santa Cruz has a rich and varied history dating back to the days of the California missions. Mission Holy Cross, around which Santa Cruz was founded, was established in 1791 and is the site of the oldest continental house of worship in our community. The mission was founded by the Franciscan Friars, and their history can be viewed to this day within the original mission buildings.

 

Here Mission Santa Cruz is visible with the city that has since sprung out around it radiating out behind.

 

 

 

Our Town

What people think of and identify as Santa Cruz is really much more than Santa Cruz City proper. While the city of Santa Cruz, with its current population of 60,000 residents, is home to our county seat, government center, city hall, and university, and defines our area, the County of Santa Cruz (with a population of 250,000) includes many smaller cities and unincorporated areas that locals and visitors alike would consider Santa Cruz. These unincorporated areas include the Harbor neighborhood, Live Oak, Pleasure Point, Aptos-Rio Del Mar, Seacliff and Seascape and the unincorporated cities of Capitola, Scotts Valley, and Watsonville. In the broadest sense, all of these areas are part of Santa Cruz and share a common lifestyle.

 

 

Agriculture

Historically, Santa Cruz has been many things to many people. The area is blessed with many natural resources and spectacular beauty. Early residents made their livelihoods ranching, farming, logging and fishing. Most of the ancient old growth redwoods that originally blanketed the Santa Cruz Mountains were logged for timber to rebuild San Francisco following the great earthquake and fire of 1906. Today we are fortunate to enjoy the next generation of redwood forests at local parks, such as Big Basin, Henry Cowell, and the Forest of Nisene Marks, where remnants of the original logging camps exist to this day. These parks and the many others that dot our local maps provide ample opportunities for hiking, camping, fishing, horseback riding and mountain biking.

 

The People

Santa Cruz enjoys the benefits of a diverse population, from seniors to students, agricultural workers to high tech “geeks.” There really is something for everyone in our community. Every year sees an influx of new students into the University of California, Santa Cruz campus, arguably the most beautiful of all the UCs. Many of these students end up staying and calling Santa Cruz home. Santa Cruz is also a popular second home getaway for folks from the Central Valley and the greater Bay Area. Seasonal vacation rentals house visitors during the busy summer season.

Santa Cruz Attractions

There are many things that make Santa Cruz unique. We are home to some of the best surf spots on the California coast. Jack O’Neill, the inventor of the wetsuit, calls Santa Cruz’s Pleasure Point home, and the Monterey Bay offers world class sailing, fishing, and kite surfing. The Santa Cruz Beach Boardwalk boasts the “Big Dipper,” one of the oldest operating roller coasters anywhere. On a quirkier note, we have the Mystery Spot in the Santa Cruz mountain foothills, as well as the Scotts Valley home of film director Alfred Hitchcock.

 

 

Education

Overall, Santa Cruz has an excellent school system. Some schools, such as Valencia Elementary, Rio Del Mar Elementary, Pacific Collegiate and of course UCSC (which has awarded 77,340 degrees since 1967) and Cabrillo, really stand out. Economically, Santa Cruz is very fortunate. We are a bedroom community for Silicon Valley. We have a large tourism industry, as well as a strong agricultural base. We have a number of excellent restaurants and a thriving local food scene, with numerous farmers’ markets and lots of great fresh, locally-grown organic produce. Santa Cruz is also fortunate to have a healthy arts scene, highlighted every year with the Open Studios Tour. And then, of course, there are the wineries, comprising the Santa Cruz Mountains Winegrowers Association. Every year, art and wine are celebrated together at annual events such as the Capitola and Scotts Valley Art and Wine Festivals.

Economy and Prices

While many parts of the local community continue to thrive economically, Santa Cruz has not been immune to the downward pressure on prices that has affected the real estate market nationwide. In some parts of the community, such as Watsonville and the San Lorenzo Valley, home values have dropped 60 percent and more since the peak of the housing bubble. Other local neighborhoods have fared better, with Capitola and Westside Santa Cruz experiencing price drops in the 35 to 45 percent range. Higher end beach properties, which have been slower in their price slide, have also dropped up to 50 percent off their peak market values. The good news is that with interest rates at historic lows homeownership is once again within reach for buyers looking to call Santa Cruz home.

 

Bottom Out

The question that always seems to come up is, have prices bottomed out? Based on my conversations with other local Realtors and industry experts the consensus is that we are currently “skipping” or “bouncing” along the bottom. With short sales and “REOs” or banked owned properties still comprising a large segment of our market at just over 40 percent, prices are not likely to start going up significantly for at least the next 3-5 years, or until the glut of distressed properties has sold. At some point we will get through this glut of foreclosure inventory and return to a more balanced and “normal” market.

 

Meanwhile, investors and first-time home buyers are picking up some great properties at relatively reasonable prices. With the median price in Santa Cruz at $460,000 for single family residences and $252,000 for condos and town homes, getting into home ownership in Santa Cruz is more affordable than it has been since the peak of the housing bubble. While these prices are higher than in many parts of the country it points out the “desirability factor” of living in this unique and beautiful area. Santa Cruz real estate is truly a finite resource with the Monterey Bay on one side and the Santa Cruz Mountains on the other. They just aren’t making any more land here and building and development are slow with numerous county regulations to navigate.

Preparing to Buy

If one is thinking of buying a home in Santa Cruz and doesn’t know the area, working with an experienced and knowledgeable local Realtor is key. With its eclectic mix of neighborhoods and geography, it really helps to spend a day or two getting to know the area before deciding on a place to call home. First time home buyers and those who have not purchased a home recently would do well to consult with a reputable mortgage professional who can help guide them through the qualification process and explain interest rates, down payment amounts and the many benefits of home ownership. It is interesting how often I hear “no one is lending” and “you can’t get financing.” The reality is there are many great loan products available at great interest rates for qualified buyers. Lending guidelines have certainly gotten more stringent but for buyers with good credit and steady employment loans are available.

 

 

For home sellers in Santa Cruz, as in many other parts of the country, these can be difficult and challenging times. For those who bought at or near the peak, a short sale may be their only option. My advice to sellers in this situation is to seek the advice of a good real estate attorney and CPA who can best explain the process as it applies to their unique history. For sellers who have owned their property for a longer time and bought before the rapid appreciation preceding and defining the real estate bubble now can be a good time to sell. There is not a lot of quality inventory on the market and many Buyers and their agents are looking for “normal” or “organic” sales that don’t involve distressed properties. As always, price, condition and location will determine how quickly a home will sell in any market.

 

About Pete:

Pete Cullen is a Realtor at Bailey Properties in Aptos. He has been practicing real estate since 2003 and has earned the GRI and e-Pro designations prior to working as a Realtor. Pete was a general contractor and has worked as a builder for over 40 years. Pete continues to work actively with local developers.

Pete is a graduate of UCSC, is vice president on the board of directors of the Friends of the Santa Cruz Public Libraries, is a member of the Santa Cruz Longboard Union and is a former CASA volunteer. Pete’s interests outside of work include surfing, mountain biking, golf, singing in the choir at St. Joseph’s in Capitola, writing poetry and wine tasting. You can find out more about Pete at www.petecullen.com, check out his blog at activerain.com, or call (831) 818-1662 for more information on Santa Cruz.