One of the most outstanding coastal communities in San Luis Obispo County, the picture-perfect town of Cayucos, CA, is home to a growing market that’s taking California luxury real estate by storm. The extraordinary and wild oceanside landscape, high-end shopping experiences, and ideal location along the coast make this town an attractive choice for investors looking to join the Cayucos real estate market.
But if you’re interested in buying or selling property here, you likely have questions about how current market trends can affect your real estate experience. Below, we’ll take a deep dive into what 2023 has in store for buyers, sellers, and investors entering the Cayucos market.
Cayucos housing market forecast
Home prices decreasing
As of May 2023, the median sales price for single-family homes in Cayucos was $650,000, a staggering decrease of 33.3% compared to last year. While the market for luxury real estate in the area has remained strong in the last several years, home values have dropped slightly since 2022. Just last year, 52 homes were sold, with an average value sitting at $1,210,000.
However, it’s important to note that the number of homes sold in May 2023 was three, boasting a significant decrease of 40% year-over-year. This could indicate the drastic shift in May’s median sales price, as April 2023 saw an average sales price of $1,015,000.
Rising interest rates
Interest rates for mortgages across the country have risen quite dramatically since late 2022, when the Federal Reserve conducted increases to combat historically high inflation rates. And it’s true that interest rates are on the rise in Cayucos, CA.
As of June 29th, 2023, the country saw the average rate of a 30-year fixed-rate mortgage rise to 6.71%, up from last week’s 6.67%. Current interest rates in California for a 30-year fixed-rate mortgage are averaging at 7.23%.
Experts claim that the latest predictions indicate the Federal Reserve is expected to raise interest rates two more times before the end of 2023. Buyers looking to purchase a home in the Cayucos area should speak with a real estate expert to determine the best way to navigate the market.
Investing indicators will favor landlords
There are several factors to consider when deciding whether or not it is opportune to join the market as a landlord. Some of the most common indicators include a healthy local economy, high demand for rental housing, and a large population of buyers. The Cayucos real estate market boasts a low housing supply that simply can’t keep up with the demand. This, compared with high-interest rates, may lead buyers to rent until they can accrue more funds to purchase a home. This means investing in real estate as a landlord could be a wise decision in 2023.
Negative net population migration
As of 2023, the net population of Cayucos sat at 2,133. Compared to 2019, the net population of the city has declined by about 4.26% per year from a high of 2,700. This trend is in line with current net population trends across California. Nevertheless, a drop in population can be a positive for real estate investors looking to buy property, as there is less competition.
San Luis Obispo County housing market
Let’s turn our attention to the county of San Luis Obispo. From this data, we can better analyze the trends in the Cayucos real estate market and come up with a more comprehensive idea of where the market will go in the upcoming years.
Cayucos foreclosure statistics 2023
Foreclosures have been exceedingly rare in San Luis Obispo County over the last decade, and the same is true for Cayucos. Since June 2022, Cayucos has seen just three foreclosure filings.
Cayucos home price trends 2023
If we look at the patterns in the average price of homes for sale in Cayucos in 2023, there are a few interesting trends to observe. First, the median home price in Cayucos has risen much faster than in San Luis Obispo, which saw an average sales price of $925,000 in April 2023 and a decrease of 6.1% since the same time last year.
What’s more, the number of homes for sale in Cayucos has remained relatively small, at two to three new properties listed per month — a sharp decrease from August 2022’s 10 listings. So far, the Cayucos real estate market has sold 12 residential properties in 2023, whereas 2022 saw a total of 75. As of May 2023, California’s Central Coast region boasts a housing supply of two-point-four months and accounts for only 4% of the state’s total home sales.
Cayucos real estate market: should you invest?
Considering all of 2023’s market trends, we still believe that now is a good time to invest in luxury real estate in Cayucos. Even though home sale prices have dropped a bit since the summer of 2022 and interest rates are high, on average, home values in Cayucos are higher than in San Luis Obispo County as a whole. Demand for beachside real estate is at an all-time high, leading homeowners to gain equity and long-term wealth. Sellers can take advantage of high demand at the negotiation table, and while buyers may boast a higher interest rate, they can always refinance at a lower rate in the future.
Reach out to a local real estate agent today
Navigating the complexities of real estate, especially in a market as competitive as Cayucos, can feel daunting. With the help of a real estate professional, you can feel at ease knowing you’re under the guidance of a skilled, experienced, and knowledgeable expert who can help you make sound decisions.
If you have any questions or comments to share about the Cayucos real estate market, or you’d like to learn more about buying and selling property in the area, get in touch with industry specialist Brittany Hensley today for more information.