Whether you are a first-time home buyer or a seasoned veteran who has bought and sold properties for decades, buying or selling a home can be a complex process. While I have compiled this list of Santa Barbara Home Buying and Selling Tips as a resource for both buyers and sellers just like you, there is nothing that can replace the guidance provided by a knowledgeable and trusted member of the real estate community. As a Santa Barbara Realtor with more than three decades of experience in the Santa Barbara and surrounding markets, it would be my great pleasure to share my vast experiences with you. Perhaps one of the biggest preparations sellers can make when listing their Santa Barbara CA houses for sale is to get their home ready for buyers’ first impressions. Items such as the walkway, front porch and entryway can be crucial in a buyer’s first impression. Be sure to keep these areas free from clutter, updated and fresh. Kitchens and bathrooms are also known to “sell homes.” These are great areas to consider a few upgrades to maximize your return. As part of the Santa Barbara Real Estate Services I offer to sellers, we will walk through your home together to determine if any updates or changes need to be made to emphasize your home’s most marketable qualities. For buyers, it is important to first ask yourself why you want to buy a home: To stop paying rent? To start building equity? To raise a family? To have a place of your own? To entertain business associates? To move up to a bigger home? Next, you should determine the type of home you would like to have. Be specific and be sure to separate the “needs” from the “wants.” Once you have started this process, it will be imperative to speak with a qualified loan consultant regarding a pre-qualification. These Santa Barbara Home Buying and Selling Tips will assist you in being ready to explore communities and tour homes of interest without going on a wild goose chase.
Should you have any questions about these Santa Barbara Home Buying and Selling Tips, I encourage you to contact me. As a local real estate professional who lives, works and plays within the communities I service, it would be my great pleasure to welcome you to our area or to help you find the perfect buyers for your Santa Barbara home. Please do not hesitate to contact me today. I look forward to hearing from you soon and to earning your trust and business. Let’s get started!
Why is Santa Barbara Real Estate so expensive?
The Santa Barbara County South Coast may be the most attractive area in all of California to live due to its coastal setting, weather and no/slow growth policies which have been legally, and more importantly mentally, in place since 1972. With a total population of just over 200,000 coupled with a job base larger than the number of housing units available, the unrelenting demand for residences far outstrips the limited supply. Demand to live on the South Coast comes not only from local South Coast buyers (who account for 69.1% of the sales), but from North County buyers (1.2%), California buyers (14.7%), Western United States buyers (6.4%), Eastern United States buyers (5.8%) and Buyers from Abroad (2.8%). The South Coast’s Median Home price runs over twice the price of California’s Median Home price. Santa Barbara is a world-class destination and a highly desirable place to live; real estate values are driven by lifestyle choices, not just by economics.
What is the Median Home Selling Price?
The Median Price represents the price point at which half the homes sell for more and half sell for less. The Median Price can fluctuate from month to month depending on the price-mix of homes sold.
Current Price Trends
South Coast of Santa Barbara County
For August 2021
Single Family Residence Market
Median Sales Price = $1,700,000
Lowest Sale Price = $785,000
Highest Sale Price = $28,000,000
Median Sales Price = $865,000
Lowest Sale Price = $429,000
Highest Sale Price = $6,400,000
Where can I see Santa Barbara homes for sale?
Just go to “Property Search” to listings currently available in any given price range.
Buying Your Santa Barbara Home
Meet with me to get a general overview of the current market and to discuss what you are looking for in a home. Contact Stan by e-mail at [email protected] or on his direct line at (805) 689-2305.
Since you will be making a serious financial commitment, your next task is to determine your budget for your investment in Santa Barbara Real Estate. If you need a mortgage, you should start the Pre-Approval process with a local lender and determine your comfort level.
Determine the size of Santa Barbara home you will require, or can live with, by identifying the spaces you need for your family’s activities. No house will ever fully live up to your dreams, so you will probably have to make some compromises. Break the process into parts and prioritize those parts. Mentally budget for the parts your really care about!
Select target neighborhoods that meet your needs for commuting, shopping access, quality of schools, availability, style and recreational activities. There is an array of possibilities; during this step we will tour homes in a few Santa Barbara neighborhoods to give you a overall view of the area.
After determining which Santa Barbara neighborhoods and will fit your desires, we will concentrate your home search in the chosen areas. This may entail e-mailing the new listings to you as they come on the market or calling you with the information.
After locating a home acceptable to you, we will prepare an offer to be presented to the Seller. This offer will contain your inspection and financing contingencies.
Upon mutual acceptance of your negotiated offer, an escrow will be opened to handle the paperwork and title insurance needed for you to purchase the property. In California, the escrow company is a neutral third party which follows mutually agreed upon instructions from the Buyer and Seller. Your deposit check, which is usually in the amount of 3% of the purchase price, will be deposited into this escrow account.
The length of escrow is negotiated in the offer and can be long or short, but the usual length is 30-45 days. Usually the Buyer has a 17 day inspection contingency and the Buyer has the right to inspect the property and review any disclosures the Seller can provide. If the Buyer requires a mortgage, the time frame for removing the loan contingency is usually between 17 and 21 days. These time frames are all negotiable.
Assuming that property checks out and you have removed all your contingencies, the balance of your funds is due in escrow the last business day prior to the escrow closing. Property transfers are recorded at 8:00 AM each business day and we usually get confirmation between 10:00 and 2:00, depending on how busy the County Recorder’s office is that particular day. Upon receiving confirmation the Seller usually releases the keys to the Buyer who is then free to occupy their new property.
Santa Barbara South Coast Real Estate Update
September 14, 2021
Direct from the County Recorder’s Office by way of Fidelity National Title, the total number of monthly residential sales on the South Coast of Santa Barbara County was down 2% from 229 in August 2020 to 225 in August 2021. In August 2021 there were 155 House/PUD (Planned Unit Development) sales, down 2.5% from 2020, with a median sales price of $1,700,000 (up 5% from 2020) and an average sales price of $3,156,748 (up 43% from 2020). In August 2021 there were 70 Condominium sales, the same as in 2020, with a median sales price of $865,0000 (up 29% from 2020) and an average sales price of $1,121,709 (up 31% from 2020). There have been a total of 1,580 residential sales in 2021 (up 38% from 2020), with a median sales price of $1,498,000 (up 14% from 2020) and average sales price of $2,488,521 (up 46% from 2020).
In Carpinteria there were a total of 21 sales in August 2021, down from 26 in July. In August 2021 the median sales price of the 13 House/PUD sales was $1,275,000 and the average price was $1,407,308. In August 2021 the median price of the 8 Condominium sales was $690,000 and the average price was $679,125. The lowest priced Carpinteria sale in August 2021 was a Condominium on 8th Street @ $490,000 and the highest was a House on Ocean View Avenue @ $2,900,000.
In Summerland there was one sale in August 2021, the same as in July. In August 2021 the one sale was an ocean front house on Finney Street @ $10,000,000.
In Montecito there were a total of 40 sales in August 2021, up from 21 in July. In August 2021 the median sales price of the 33 House/PUD sales was $4,320,000 and the average price was $6,865,411. In August 2021 the median price of the 7 Condominium sales was $2,100,000 and the average price was $2,945,714. The lowest priced Montecito sale in August 2021 was a Condominium on Jameson Lane @ $1,000,000 and the highest was a tie between two Estates on San Ysidro Road and Park Lane, both which sold for $28,000,000.
In Santa Barbara there were a total of 101 sales in August 2021, up from 92 in July. In August 2021 the median sales price of the 65 House/PUD sales was $1,600,000 and the average price was $1,903,184. In August 2021 the median price of the 36 Condominium sales was $882,000 and the average price was $998,574. The lowest priced Santa Barbara sale in August 2021 was a Condominium on Richland Drive @ $510,000 and the highest was a House on W. Mountain Drive @ $5,005,005.
In Hope Ranch there were a total of 7 sales in August 2021, up from 2 in July. In August 2021 the median sales price of the 7 House sales was $5,000,000 and the average price was $7,991,143. There are no PUD’s or Condominiums in Hope Ranch. The lowest priced Hope Ranch sale in August 2021 was a House on Via Sinuosa @ $3,400,000 and the highest was an Estate on Cuervo Avenue @ $19,900,000.
In Goleta there were a total of 55 sales in August 2021, down from 56 in July. In August 2021 the median sales price of the 36 House/PUD sales was $1,345,000 and the average price was $1,522,149. In August 2021 the median price of the 19 Condominium sales was $865,000 and the average price was $869,368. The lowest priced Goleta sale in August 2021 was a Condominium on Dearborn Place @ $429,000 and the highest was a House on Via Brigitte @ $5,025,000.
The COVID-19 pandemic has not only affected our daily lives, but also how everyone buys and sells real estate. As of June 15th, open houses and Broker Tours are now once again allowed. Many Sellers who had avoided listing their homes due to COVID-19 concerns have now moved forward and listed their properties for sale, but inventory still remains very low. And now the Delta Variant is causing Sellers to be very cautious. Historically low mortgage interest rates and the glut of Buyers are driving real estate values upward along the South Coast of Santa Barbara County.
The limited supply of available properties along the South Coast of Santa Barbara County keeps values higher compared to other areas of California and of the United States. Along the South Coast of Santa Barbara County as of August 1st there were 112 active House/PUD listings (down from 117 in July) and 28 active Condominium listings available (the same as in July). Historically there has been much more inventory available in the higher price ranges than in the lower ranges; as of August 1st, 35.7% (up from 27% in July) of the 117 active House/PUD listings were located in the higher valued Montecito and Hope Ranch areas. Compare these current low totals to the inventory levels from 2007 to 2011 when the total number of active listings ranged between 734 and 1,026. Historically the highest number of active listings along the South Coast was recorded in June of 1992 when there were an astounding 1,297 active listings available.
In all of 2021 there have been only 2 bank-owned sales along the South Coast of Santa Barbara County and as of September 1st there were no bank-owned listings for sale or pending on the South Coast of Santa Barbara County. There was 1 bank-owned sale in January on Cresta Avenue @ $3,040,000 and 1 in February on Las Positas Place @ $981,000. There have been very few distress sales due to homeowner equity rising so quickly which allows them to “bail out” of their financially distressed properties, pay off their mortgage and avoid foreclosure. To check out California’s foreclosure list by County, visit this RealtyTrac link: California Foreclosure Trends by County .
As of June 2021 (the latest monthly data available from CoreLogic), the highest recorded median sales price in any California county was in San Mateo County @ $1,583,500 (up 12.3% from 2020) and the lowest recorded county median sales price was in Siskiyou County @ $279,000 (up 23.2% from 2020). The median sales price in Santa Barbara County was $675,000 (up 7.1% from 2020) while the median sales price in the City of Santa Barbara was $1,605,000 (up 13.1% from 2020). Other than residential fire-lot sales, the lowest median sales price in any California city was recorded in Calipatria in Imperial County @ $46,000 (down 75.1% from 2020) and the highest was in Atherton in San Mateo County @ $6,400,000 (up 16.4% from 2020). You could buy 139 median priced Houses in Calipatria, 9.5 in Santa Barbara County or 4 in the City of Santa Barbara for the same price as 1 House in Atherton. If you care to see a House you can buy in Calipatria for only $145,000, check https://www.realtor.com/realestateandhomes-detail/660-Ironwood-Rd_Calipatria_CA_92233_M19737-29795 . If you care to see a House you can buy in Atherton for $6,995,000, check https://www.realtor.com/realestateandhomes-detail/345-Stockbridge-Ave_Atherton_CA_94027_M11139-28290 .
The Federal Reserve (the Fed) has maintained a near zero rate since early 2020 due to the negative effects on the economy due to COVID-19 and now the Delta Variant. On August 27th Chairman Jerome Powell said in a briefing “We have much ground to cover to reach maximum employment, and time will tell whether we have reached 2 percent inflation on a sustainable basis. If a central bank tightens policy in response to factors that turn out to be temporary … the ill-timed policy move unnecessarily slows hiring and other economic activity and pushes inflation lower than desired. Today, with substantial slack remaining in the labor market and the pandemic continuing, such a mistake could be particularly harmful.” As of September 3rd you could lock in a $600,000 30-year fixed rate loan at 2.8%, up from 2.625% in August. Historically the lowest 30-year mortgage interest rate since 1970 was recorded in February 2021 at 2.65%, which was matched in July 2021. The highest mortgage rate was recorded in 1981 @ 18.63%. As an example, your payment for a $600,000 mortgage in 1981 would have been $9,352/month; as of September 3rd it would be $2,465/month.
Of the 225 sales in August 2021, 169 were over $1,000,000 which equates to 75% of the total sales, up from 70% in July. The South Coast of Santa Barbara is not an inexpensive place to purchase real estate as compared to most areas of the United States, but again many people will pay more to live and invest in Santa Barbara. According to CNN the national average for all cash real estate sales is 25% (up from 15% in 2020); on the South Coast in August 2021, 41% were cash sales, up from 28% in July. See the attached list of the 225 properties sold on the South Coast of Santa Barbara County in August 2021 and/or contact me for information on specific sales.
On August 31st the Conference Board reported that the Consumer Confidence Index was 113.8, down from 125.1 July. In recent years the highest recent Index level recorded was 137.9 in October 2018 and it was more recently as high as 132.6 in February 2020, prior to the negative effects of the COVID-19 pandemic. Historically the highest Consumer Confidence Index level was recorded in September 2000 when the Index stood at 142.5. Lynn Franco, Senior Director of Economic Indicators at The Conference Board stated “Consumer confidence retreated in August to its lowest level since February 2021 (95.2). Concerns about the Delta variant—and, to a lesser degree, rising gas and food prices—resulted in a less favorable view of current economic conditions and short-term growth prospects.” To review the full report: https://conference-board.org/data/consumerconfidence.cfm .
As for the cost of living as of September 2021, Expatistan compiled an index of 199 major metropolitan areas worldwide. Expatistan’s list indicates #5 Mountain View, CA with a 236 Price Index score is the most expensive area in California (a gallon of regular gas costs $2.79) and the least expensive in the USA to be Memphis, TN @ 122 ($2.67/gallon). Of the top 25 most expensive areas worldwide, 6 (up from 5 in August) are in California including: #6 San Francisco @ 227 ($3.99/gallon), #9 Oakland @ 214 ($3.89/gallon), #13 San Jose @ 204 ($3.79/gallon), #18 Los Angeles @ 200 ($3.79/gallon) and #25 San Diego @ 195 ($3.59/gallon). The most expensive area to live in the world is #1 Grand Cayman (Cayman Islands) @ 258 ($5.07/gallon) and the least expensive is #199 Hyderabad (India) @ 50 ($4.44/gallon). Santa Barbara is not on the list as Expatistan does not rate it as a major metropolitan area, but gas prices of $4.09/gallon are a bit higher compared to other coastal California areas. The cost of living list is interesting to check out if you want to compare the cost of living in cities around the world: https://www.expatistan.com/cost-of-living/index .
As of August 28th, Danielle Hale and Sabrina Speianu at realtor.com, wrote about national housing trends @ https://www.realtor.com/research/weekly-housing-trends-view-data-week-july-24-2021/ : “The median listing price grew at 8.6 percent over last year, marking five straight weeks of single-digit price growth after a 50-week streak of double-digit price growth. Despite the slower growth rate, the median home list price remains near its record-high July level of $385,000 at $380,000. Additionally, this rate of growth is still higher than we’ve seen historically. We expect prices to ease as we head into fall, as they have historically, which will mean still-strong pricing for sellers and a window of opportunity for buyers.” Santa Barbara real estate is trending much higher than the national levels and always has.
Historically the highest Year-to-Date median sales price recorded on the Santa Barbara South Coast had been recorded in 2007 at $1,031,500. The median sales price for all of 2020 was $1,200,000. In August 2021 the median sales price was $1,498,000, up 25% from 2020. The median sale price had been hovering near 2007’s historic high for most of 2017, 2018 and 2019, but now new record highs have been set each month of 2021. In August 2021 the average South Coast sales price was $2,488,521.
Based on the Santa Barbara Multiple Listing Service data, as of September 1st, in the City of Santa Barbara there were 46 active House/PUD listings and 51 pending sales, which equates to a very low .9 month supply (up from .63 in August) of listings for Buyers to choose from. Generally a “one month’s supply” would indicate the listings would all be sold within one month. Under 3 months of inventory would be considered a basic Seller’s market where demand is high and inventory is scarce, lower than 2 months supply of inventory indicates a heated Seller’s market and lower than 1 month supply indicates a feverish Seller’s market. Historically a 4 to 5 month supply of available inventory would indicate a fairly well-balanced market between Buyers and Sellers. Typically a 6+ month supply is considered to be a Buyer’s market where inventory is plentiful; Buyers are slower to make decisions and want to compare everything on the market. Based on Santa Barbara Multiple Listing Service data and as of September 1st, Carpinteria/Summerland had a .71 month supply (up from .43 in August), Montecito had a 3.4 month supply (down from 1.9 in August), Goleta had a .48 month supply (up from .35 in August) and Hope Ranch had 3 month supply (up from .8 in July). These inventory statistics indicate that Carpinteria/Summerland, Santa Barbara and Goleta are all in a feverish Seller’s market with less than a month’s worth of available inventory. Montecito and Hope Ranch have moved towards a more balanced market from variations of a Seller’s market. With a combined total of 109 House/PUD pending sales and only 112 active listings on the South Coast of Santa Barbara County, there is only a 1.03 month supply of House/PUD listings from which Buyers can choose. With a combined total of 42 Condominium pending sales and only 28 active listings on the South Coast of Santa Barbara County, there is only a .67 month supply of Condominium listings from which Buyers can choose.
The ramifications of the concerns about the new variants of COVID-19 and how they have and will continue to affect our world, government spending in response to COVID-19, the Federal & State stimulus packages and property insurance scarcity amid rising premiums are concerns to many Sellers and Buyers along the South Coast of Santa Barbara County. Now that Proposition 19 has taken full effect, all older (55+) homeowners can transfer their existing real estate tax base to a new home anywhere in California; hopefully this will bring a few more listings onto the market. Historically low interest rates, and extremely low inventory have boosted real estate values along the South Coast of Santa Barbara County. COVID-19 restrictions have actually made many people realize they have the flexibility to work virtually from anywhere; they move to areas like Santa Barbara because they desire a more comfortable and “safer” lifestyle. This migratory trend has led to a surge in local property values. With a glut of potential Buyers and low inventory, it is now the Buyers who are determining the price of homes. Supply and demand dynamics have and will continue to affect the South Coast of the Santa Barbara Real Estate Market now and for a long time to come.
Feel free to contact me with any questions.
Stan Tabler, CRS, GRI, ABR, GREEN
801 Chapala Street
Santa Barbara, CA 93101
CalBRE Brokers License #00774377 since 1980