Santa Barbara South Coast Real Estate Update
October 15, 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 37% from 271 in September 2020 to 171 in September 2021. In September 2021 there were 122 House/PUD (Planned Unit Development) sales, down 40% from 2020, with a median sales price of $1,790,000 (up 4% from 2020) and an average sales price of $2,599,199 (down 9% from 2020). In September 2021 there were 49 Condominium sales, (down 31% from 2020) with a median sales price of $850,000 (up 22% from 2020) and an average sales price of $1,053,951 (up 15% from 2020). There have been a total of 1,751 residential sales in 2021 (up 24% from 2020), with a median sales price of $1,495,000 (up 27% from 2020) and average sales price of $2,456,087 (up 34% from 2020).
In Carpinteria there were a total of 16 sales in September 2021, up from 8 in August. In September 2021 the median sales price of the 5 House/PUD sales was $1,635,000 and the average price was $3,521,000. In September 2021 the median price of the 11 Condominium sales was $695,000 and the average price was $1,047,589. The lowest priced Carpinteria sale in September 2021 was a Condominium on Hickory Street @ $520,000 and the highest was an oceanfront House on Padaro Lane @ $12,000,000.
In Summerland there were a total of 2 sales in September 2021, up from 1 in August. In September 2021 the median and average sales prices of the 2 House/PUD sales was $2,726,081. In September 2021 there were no Condominium sales in Summerland. The lowest priced Summerland sale in September 2021 was a House on Golden Gate Avenue @ $2,202,162 and the highest was a House on Valencia Road @ $3,250,000.
In Montecito there were a total of 26 sales in September 2021, down from 40 in August. In September 2021 the median sales price of the 24 House/PUD sales was $4,857,741 and the average price was $5,446,855. In September 2021 the median and average sales prices of the 2 Condominium sales was $2,225,000. The lowest priced Montecito sale in September 2021 was a House on Toro Canyon Road @ $1,475,000 and the highest was an Estate on San Ysidro Lane @ $13,250,000.
In Santa Barbara there were a total of 80 sales in September 2021, down from 101 in August. In September 2021 the median sales price of the 62 House/PUD sales was $1,582,500 and the average price was $1,826,204. In September 2021 the median price of the 18 Condominium sales was $892,500 and the average price was $1,047,589. The lowest priced Santa Barbara sale in September 2021 was a Condominium on Micheltorena Street @ $570,000 and the highest was a House on Sea Ranch Drive @ $4,300,000.
In Hope Ranch there were a total of 2 sales in September 2021, down from 7 in August. In September 2021 the median and average sales prices of the 2 House/PUD sales was $3,287,500. There are no Condominiums in Hope Ranch. The lowest priced Hope Ranch sale in September 2021 was a House on Silvestre Road @ $2,650,000 and the highest was a House on Estrella Drive @ $3,925,000.
In Goleta there were a total of 45 sales in September 2021, down from 55 in August. In September 2021 the median sales price of the 27 House/PUD sales was $1,300,000 and the average price was $1,611,889. In September 2021 the median price of the 18 Condominium sales was $792,500 and the average price was $805,694. The lowest priced Goleta sale in September 2021 was a Condominium on Dearborn Place @ $464,000 and the highest was a House on Via Del Rey @ $4,145,000.
Analysis
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 as sale prices have surged, 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 October 1st there were 112 active House/PUD listings (same as in September) and 27 active Condominium listings available (down from 28 in September). Historically there has been much more inventory available in the higher price ranges than in the lower ranges; as of October 1st, 33% (down from 35.7% in August) 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 October 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, check out this link: California Foreclosure Trends by County .
As of August 2021 (the latest monthly data available from CoreLogic), the highest recorded median sales price in any California county was in San Mateo County @ $1,500,000 (up 1.7% from 2020) and the lowest recorded county median sales price was in Kings County @ $290,000 (up 7.4% from 2020). The median sales price in Santa Barbara County was $776,500 (up 12.5% from 2020) while the median sales price in the City of Santa Barbara was $1,600,000 (up 12.5% from 2020). Other than residential fire-lot sales, the lowest median sales price in any California city was recorded in Inyokern in Kern County @ $72,250 (down 63.9% from 2020) and the highest was in Atherton in San Mateo County @ $6,500,000 (down 6.1% from 2020). You could buy 90 median priced Houses in Inyokern, 8.8 in Santa Barbara County or 4.1 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 Inyokern for only $98,000, check https://www.realtor.com/realestateandhomes-detail/6621-Valley-Ave_Inyokern_CA_93527_M93388-19219 . If you care to see a House you can buy in Atherton for $6,495,000, check https://www.realtor.com/realestateandhomes-detail/497-Stockbridge-Ave_Atherton_CA_94027_M25441-69269 .
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 $661,000 30-year fixed rate loan at 3%, up from 2.8% in September. 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 a comparison, your payment for a $661,000 mortgage in 1981 would have been $10,302/month; as of October 8th it would be $2,787/month.
Of the 171 sales in September 2021, 124 were over $1,000,000 which equates to 72.5% of the total sales, down from 75% in August. 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 September 2021, 29% were cash sales, down from 41% in September. See the attached list of the 171 properties sold on the South Coast of Santa Barbara County in September 2021 and/or contact me for information on specific sales.
On September 28th the Conference Board reported that the Consumer Confidence Index was 109.3, down from 115.2 August. 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. “Consumer confidence dropped in September as the spread of the Delta variant continued to dampen optimism,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “Concerns about the state of the economy and short-term growth prospects deepened, while spending intentions for homes, autos, and major appliances all retreated again. Short-term inflation concerns eased somewhat, but remain elevated. Consumer confidence is still high by historical levels—enough to support further growth in the near-term—but the Index has now fallen 19.6 points from the recent peak of 128.9 reached in June. These back-to-back declines suggest consumers have grown more cautious and are likely to curtail spending going forward.” To review the full report: https://conference-board.org/data/consumerconfidence.cfm .
As for the worldwide cost of living as of October 2021, Expatistan compiled an index of 194 major metropolitan areas. Expatistan’s list indicates #5 Mountain View, CA with a 243 Price Index score is the most expensive area in California (a gallon of regular gas costs $3.89) and the least expensive in the USA to be Memphis, TN @ 109 ($2.64/gallon). Of the top 25 most expensive areas worldwide, 5 (same number as in August) are in California including: #7 San Francisco @ 232 ($3.77/gallon cash), #10 Oakland @ 221 ($3.89/gallon cash), #17 Los Angeles @ 206 ($3.82/gallon) and #25 San Diego @ 101 ($3.49/gallon). The most expensive area to live in the world is #1 Grand Cayman (Cayman Islands) @ 265 ($5.09/gallon) and the least expensive is #194 Hyderabad (India) @ 50 ($5.27/gallon). Santa Barbara is not on the list as Expatistan does not rate it as a major metropolitan area, but gas prices of $4.05/gallon are a bit higher compared to larger California urban 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 September 30th, Danielle Hale and Sabrina Speianu at realtor.com, wrote about national housing trends @ https://www.realtor.com/research/september-2021-data/ :
- The national inventory of active listings declined by 22.2% over last year, while the total inventory of unsold homes, including pending listings, declined by 12.6%. The inventory of active listings is down 52.5% compared to 2019.
- Newly listed homes are down 3.9% nationally compared to a year ago, and down 3.4% for large metros over the past year. Sellers are still listing at rates 12.6% lower than typical 2017 to 2019 levels.
- The September national median listing price for active listings was $380,000, up 8.6% compared to last year and up 20.6% compared to 2019. In large metros, median listing prices grew by 4.1% compared to last year, on average.
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 September 2021 the median sales price was $1,495,000, basically unchanged from August, but up 25% from 2020. The median sale price had been hovering near 2007’s historic high for most of 2017, 2018, 2019 and into 2020, but now there are new record highs have been set. In September 2021 the average South Coast sales price was $2,456,087.
Based on the Santa Barbara Multiple Listing Service data, as of October 1st, in the City of Santa Barbara there were 35 active House/PUD listings and 46 pending sales, which equates to an extremely low .76 month supply (down from .9 in September) 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 October 1st, Carpinteria/Summerland had a 1.4 month supply (up from .71 in September), Montecito had a 2.6 month supply (down from 3.4 in September), Goleta had a 1.1 month supply (up from .48 in September) and Hope Ranch had 2 month supply (down from 3 in September). These inventory statistics indicate that Santa Barbara is in a feverish Seller’s market with less than a month’s worth of available inventory. Carpinteria/Summerland and Goleta are in a heated Seller’s market. Montecito and Hope Ranch are in a basic 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 1.2 month supply of House/PUD listings from which Buyers can choose. With a combined total of 50 Condominium pending sales and only 27 active listings on the South Coast of Santa Barbara County, there is only a .54 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
Compass
801 Chapala Street
Santa Barbara, CA 93101
805.689.2305
CalBRE Brokers License #00774377 since 1980
Realtor of the Year
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