Drilling Down and the Three D’s


Continuing the conversation…drilling down on the question lots of locals have been asking lately: Who is it that’s selling homes here and where are they going? And who is buying them and where are they coming from? First, let’s look at the seller side of the equation:

If there is such a thing as an “average seller” these days, the description would go something like this: most are between 60 and 90 years old and qualify as either aging baby- boomers or the aging parent(s) of aging baby- boomers. They reflect a huge demographic shift that’s happening nationwide as more people are living longer and wrestling with questions they never had to consider before.

In order to sell a house, people also have to own one first. And in a place where the median price fluctuates just above or below the $900,000 mark, it’s not surprising that most sellers are folks who’ve been alive long enough to gather the resources necessary to afford one in the first place.

People don’t sell homes on a whim. The process is simply too hard and requires
too much emotional energy to be a “sport”. Homes are people’s biggest asset and the all- important centering places for privacy, safety and comfort in their lives. Selling is almost never an end in itself. It is usually just one step in a much larger life transition sellers are going through.

These days, it’s not unusual to hear agents talk about the “Three Ds” as the driving forces behind the market. That’s real estate shorthand for Death, Divorce and Downsizing – things that definitely qualify as big life transitions, particularly for folks who find themselves heading into the last third of their lives.

I haven’t noticed an increase in divorce-driven home sales but then, people splitting up has always been a steady source of supply for the market. I also haven’t noticed fewer marriages ending recently. As far as death-driven sales? Since more homeowners are living into their 80s and 90s, it stands to reason that a higher percentage of the homes selling are estate sales.

Downsizing is by far the most significant factor for the majority of sellers in Santa Cruz. And before I simplify it too much, it bears repeating that “downsizing” has become a cultural meme for lots of different considerations that people past the age of 60 have: empty nesting, health challenges, retirement planning, tax consequences, estate planning and the desire for less maintenance and fewer stairs (to name a few).

In other words, it’s complicated. That’s who is selling in Santa Cruz these days…next week we’ll talk about where they are going.

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