MAY/JUNE 2011

Inside This Issue

Susan Strouse, B.S., M.A.
Strouse Realty Group American Dream Realty 5522 Scotts Valley Dr. Scotts Valley, CA 95066 (831) 338-6481 Susan@StrouseRealtyGroup.com http://www.StrouseRealtyGroup.com
DRE #01228878

> LOCAL MARKET TRENDS ..................... 1 > MORTGAGE RATE OUTLOOK ............... 2 > HOME STATISTICS .............................. 2 > FORECLOSURE STATS ........................ 3 > CONDO STATISTICS ............................ 3 > ANNUAL TABLES ................................. 4

The Real Estate Report
local market trends
SANTA CRUZ COUNTY
Trends at a Glance

Home Sales Up Fourth Month in a Row
Although sales of single-family, re-sale homes unexpectedly fell compared to March, a very unusual event, they were up in April, year-over-year, for the fourth month in a row by a healthy 33%. The median price for single-family, re-sale homes in Santa Cruz County was down 14.7% year-overyear, while the average price declined 11.3%.

MORE STATISTICS…
Year-over-year, home inventory was down for the first month since last March: -0.6%. The sales price to list price ratio turned around last month and dropped one point to 96.8%. Pending sales were off for the ninth month in a row: 14.7%. All these statistics are year-over-year.

(Single-family Homes) Apr 11 Mar 11 Apr 10 Median Price: $ 470,500 $ 480,000 $ 551,500 Av erage Price: $ 523,754 $ 534,374 $ 590,673 Units Sold: 133 167 100 Inv entory : 637 580 641 Sale/List Price Ratio: 96.8% 97.8% 97.1% Day s on Market: 89 101 65 Day s of Inv entory 139 104 186

SALES MOMENTUM…
although still negative, started trending upward last month and is now at –5, a gain of 4 points. Our momentum stats are calculated using a 12month moving average to eliminate seasonality. By comparing this year’s 12-month moving average to last year’s, we get a percentage showing market momentum.

IN THE CONDO MARKET…
the median price was down 11.9% year-over-year. Condos sales were flat year-over-year. Pending sales were down for the eighth month in a row year-over-year: 24.2%. Inventory, on the other hand, increased for the eleventh month in a row: up 38% year-over-year. Remember, the real estate market is a matter of neighborhoods and houses. No two are the same. For complete information on a particular neighborhood or property, call.

PENDING MOMENTUM…
a harbinger of future sales, while still positive, has been trending downward. Last month the number was –3, a decline from +1 the month before.

PRICING MOMENTUM…
after peaking at +12% last August, has also been trending downward and is now at –3.

Santa Cruz County Homes: Sales Momentum
60.0% 40.0% 20.0% 0.0% 0 FMAMJ JA SOND0 FMAMJ JA SOND0 FMAMJ JA SOND0 FMAMJ JA SOND1 FMAMJ JA SOND1 FMA -20.0% 6 7 8 9 0 1 -40.0% -60.0% Sales Pending Median © 2011 rereport.com

Susan Strouse, B.S., M.A. | Susan@StrouseRealtyGroup.com | (831) 338-6481

The Real Estate Report

Mortgage Rate Outlook
30-Year Fixed Mortgage Rates
04-11 01-11 10-10 07-10 04-10 01-10 10-09 07-09 04-09 01-09 10-08 07-08 04-08 01-08 10-07 07-07 04-07 01-07 10-06 07-06 04-06 01-06 10-05 07-05 04-05 01-05 3.0%

Apr 29, 2011 -- Mortgage rates, seemingly as unconcerned about inflation as the Fed appears to be, found new reasons to drift downward, and there may be reason to believe that we could see more of this as Summer approaches.

4.0%

5.0%

6.0%

7.0%

8.0%

Growth is already weaker and inflation rising. The initial estimate of GDP growth for the first quarter of this year came in at 1.75%, a considerable downshift from the 3.11% clip seen in the fourth quarter of 2010. PCE inflation for the quarter climbed to 3.5% from 1.7% in 4Q10, and "core" PCE moved from HSH.com's overall mortgage tracker -- our weekly 0.4% to 1.5% over the same three-month period. In Fixed-Rate Mortgage Indicator (FRMI) -- found that his press session, Mr. Bernanke took some pains to the overall average rate for 30-year fixed-rate mortexpress that the Fed believes these inflation trends gages declined by three basis points (.03%) to 5.06% are "transitory"; rising food and gasoline prices may A key component of the first-time homebuyer market, indeed foster slower growth, and such slowing would FHA-backed 30-year fixed-rate mortgages fell by just eventually serve to cool price pressures, but would two basis points, falling to 4.72% for the week. Hybrid carry unwanted implications for the economy as well. 5/1 ARMs averaged 3.66% this week, down fiveThe Fed again characterized the housing sector as hundredths of a percent from last week's average. "depressed". Even outstanding mortgage rates are The Fed released their new forecast for GDP growth failing to overcome poor economic conditions which and inflation for the coming year. The new forecasts are perpetuating a lack of demand. Plus, home prices call for slower economic growth (centering around a are still softening in many areas, and that removes 3.2% annual pace, down from about 3.7% in the the urgency for a potential homebuyer to move quickJanuary forecast). Inflation expectations were ly. Sales of new homes did move higher in March, ratcheted up considerably; the Personal Consumpbut the 300,000 annualized rate of sale remains tion Expenditure (PCE) inflation (the Fed's preferred among the weakest on record. At the moment, there gauge) increased from a January forecast of about are about 7.3 months of available supply, with 1.5% to a new 2.4% expectation. Essentially, growth 183,000 units built and ready to sell. In the face of is expected to be weaker and inflation higher. such soft demand, builders won't or can't build more "on spec" in hopes of finding future buyers.

0 FMAMJ JA SOND0 FMAMJ JA SOND0 FMAMJ JA SOND1 FMAMJ JA SOND1 FMA 7 8 9 0 1

Santa Cruz County - April 2011
Single-Family Homes
Cities County Aptos Capitola Rio del Mar Seacliff San Lorenzo Vly Soquel Scotts Valley Santa Cruz East County West County Watsonv ille $ $ $ $ $ $ $ $ $ $ $ $

% Change from Year Before

Susan Strouse, B.S., M.A.
Strouse Realty Group American Dream Realty 5522 Scotts Valley Dr. Scotts Valley, CA 95066 (831) 338-6481 Susan@StrouseRealtyGroup.com http://www.StrouseRealtyGroup.com
DRE #01228878

Prices Prices Median Average Sales Pend Inven DOI SP/LP Med Ave Sales Pend2 Inven 470,500 $ 523,754 133 297 637 139 96.8% -14.7% -11.3% 33.0% -14.7% -0.6% 516,000 $ 498,000 4 12 36 261 90.9% -10.3% -3.9% 33.3% -25.0% -28.0% 604,250 $ 576,875 4 7 23 167 95.4% -9.8% -3.1% -20.0% 250.0% 9.5% 735,000 $ 754,135 13 16 56 125 97.7% 8.2% 20.4% 160.0% 6.7% -24.3% 491,000 $ 617,000 3 4 16 155 96.1% -34.9% -18.8% 0.0% -33.3% 14.3% 331,000 $ 326,560 26 48 89 99 96.3% -19.4% -19.7% 85.7% -28.4% 6.0% 436,000 $ 423,667 3 19 38 367 95.8% -45.5% -48.6% -40.0% 18.8% 26.7% 656,500 $ 670,850 10 29 68 197 94.5% -22.4% -28.7% 25.0% 7.4% -9.3% 613,000 $ 683,709 36 75 150 121 96.9% -1.5% -6.1% 38.5% 4.2% 6.4% 290,000 $ 383,415 13 32 72 161 100.8% -2.0% -3.8% -7.1% -17.9% 22.0% 405,000 $ 405,000 1 7 17 493 101.4% -27.7% -27.7% 0.0% 40.0% 6.3% 320,000 $ 291,588 17 41 28 48 97.1% -8.6% -8.8% 30.8% -21.2% 115.4%

Page 2

Single-family Hom e Sales

Median & Average Prices

The chart above shows the National monthly average for 30-year fixed rate mortgages as compiled by HSH.com. The average includes mortgages of all sizes, including conforming, "expanded conforming," and jumbo.

Santa Cruz County Homes - Prices & Sales
(3-month moving average—prices in $000's) $1,000 $900 $800 $700 $600 $500 $400 $300 $200 $100 200 180 160 140 120 100 80 60 40 20 0

Santa Cruz County Homes: Year-Over-Year Median Price Change
40.0% 30.0% 20.0% 10.0% 0.0% -10.0% 0 F MA M J J A S O N D 0 F MA M J J A S O N D 0 F MA M J J A S O N D 1 F MA M J J A S O N D 1 F MA 8 9 0 1 -20.0% 7 -30.0% -40.0% -50.0%

Susan Strouse, B.S., M.A.
Strouse Realty Group American Dream Realty 5522 Scotts Valley Dr. Scotts Valley, CA 95066 (831) 338-6481 Susan@StrouseRealtyGroup.com http://www.StrouseRealtyGroup.com
DRE #01228878

FORECLOSURE STATISTICS
Notices of default, the first step in the foreclosure process, in Santa Cruz County decreased 32.1% in March from the year before. Notices were up 14.7% from February. Notices of sale, which set the date and time of an auction, and serve as the homeowner's final notice before sale, were down 22.3% year-over-year, and down 16.9% from January. After the filing of a Notice of Trustee Sale, there are only three possible outcomes. First, the sale can be cancelled for reasons that include a successful loan modification or short sale, a filing error, or a legal requirement to re-file the notice after extended postponements. Alternatively, if the property is taken to sale, the bank will place the opening bid. If a third party, typically an investor, bids more than the bank's opening bid, the property will be sold to the third party; if not, it will go back to the bank and become part of that bank's REO inventory. In January, cancellations were up 11.7% year-overyear, and up 11.7% from February. Properties going back to the bank rose in March from February by 22.6%. Year-over-year, properties going back to the back also rose 22.6%. The total number of homes that have had a notice of default filed declined by 20.1% in March compared to March 2010. They were down 2.7% from February. The total number of homes scheduled for sale decreased by 6.3% from February, and, were down 3.9% year-over-year. Unfortunately, the total number of homes owned by the banks was up 24.8% year-over-year. Ouch!

Santa Cruz County Condos- Prices & Sales
(3-month moving average—prices in $000's) $700 s e c$600 i r P e$500 g a r e$400 v A &$300 n a i d$200 e M $100 0 FMAMJ J ASOND 0 FMAMJ J ASOND 0 FMAMJ J ASOND 1 FMAMJ J ASOND 1 F 7 8 9 0 1 45 40 35 30 25 20 15 10 5 0

Table Definitions _______________ Median Price
s e l a S o d n o C The price at which 50% of prices were higher and 50%were lower.

Average Price
Add all prices and divide by the number of sales.

SP/LP
Sales price to list price ratio or the price paid for the property divided by the asking price.

Santa Cruz County - April 2011
Condos/Townhomes
Cities County Aptos Capitola Rio del Mar Scotts Valley Santa Cruz Watsonv ille $ $ $ $ $ $ $

DOI
% Change from Year Before
Days of Inventory, or how many days it would take to sell all the property for sale at the current rate of sales.

Prices Prices Median Average Sales Pend Inven DOI SP/LP Med Ave Sales Pend2 Inven 292,500 $ 320,496 35 69 207 172 97.7% -11.9% -10.7% 0.0% -24.2% 38.0% 274,750 $ 274,750 2 2 4 58 98.2% -21.5% -21.5% 0.0% -50.0% 33.3% 271,500 $ 351,080 5 7 10 58 99.3% -12.4% 13.3% 150.0% -36.4% -37.5% 447,500 $ 447,500 2 3 36 522 96.5% 12.2% -20.0% -60.0% 0.0% 38.5% 347,450 $ 344,975 4 11 5 36 99.0% -5.8% -2.2% 33.3% 120.0% -28.6% 351,500 $ 395,245 10 20 66 191 96.0% 0.4% -2.7% 11.1% -16.7% 26.9% 200,000 $ 201,846 9 15 19 61 99.8% -7.0% -4.2% 12.5% -28.6% 111.1%

Pend
Property under contract to sell that hasn’t closed escrow.

Inven
Number of properties actively for sale as of the last day of the month.

Page 3

THE REAL ESTATE REPORT
Santa Cruz County

Susan Strouse, B.S., M.A.
American Dream Realty
5522 Scotts Valley Dr. Scotts Valley, CA 95066

(831) 338-6481 Susan@StrouseRealtyGroup.com http://www.StrouseRealtyGroup.com

Go online to see the full report with the city by city breakdown:

http://www.StrouseRealtyGroup.com

Santa Cruz County Foreclosures
Total Inventories
1,000 900 800 700 600 500 400 300 200 100 10 F M Preforeclosure A M J J 10 Scheduled for Sale S O N D 11 Bank Owned

This Real Estate Report is published and copyrighted by http://rereport.com. Information contained herein is deemed accurate and correct, but no warranty is implied or given.

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