Santa Cruz-Watsonville, CA Federal Housing Finance Agency Home Price Index (FHFA HPI)

The Santa Cruz-Watsonville, CA, Federal Housing Finance Agency (FHFA) house price index (HPI) is a weighted, repeat-sales index measuring average price changes in single-family houses in the Santa Cruz-Watsonville metropolitan area. The HPI covers sales of both new and existing homes.

As of December 2020, the Santa Cruz-Watsonville HPI was up 7.1% from a year ago. This is slightly higher than the national HPI growth rate of 6.8%. Home prices in the Santa Cruz-Watsonville metro area have been rising steadily for the past few years and are now at an all-time high.

The main driver of rising home prices in the Santa Cruz-Watsonville metro area is strong demand from buyers. The population of the metro area has been growing steadily for many years, and there has been an influx of new residents from other parts of California and other states due to the region’s strong job market and attractive lifestyle. The combination of population growth and increased demand has put upward pressure on home prices.

In addition to strong demand, another factor that has contributed to rising home prices in the Santa Cruz-Watsonville metro area is limited supply. The number of homes available for sale has not kept pace with population growth and increased demand, resulting in tight housing market conditions. Competition among buyers is driving up prices for available homes.

Looking ahead, it is expected that home prices will continue to rise in the Santa Cruz-Watsonville metro area as long as population growth and job market conditions remain strong. However, if there is a significant increase in interest rates or economic uncertainty, it could lead to a slowdown or reversal in price gains.