Santa Barbara South Coast Real Estate Update
March 9, 2019
Direct from the County Recorder’s Office by way of Fidelity National Title, the overall number of property sales on the South Coast of Santa Barbara County was up 5% from 111 in February 2018 to 116 in February 2019, the January-February median sales price was up 2.5% from 2018 to $1,025,000 in 2019 and the January-February average sales price was up 18% from 2018 to $1,769,407 in 2019. In February 2019 there were 79 House/PUD sales with a median sales price of $1,300,000 and an average sales price of $2,198,044. In February 2019 there were 37 Condominium sales with a median sales price of $600,000 and an average sales price of $751,419.
In Carpinteria there were 16 sales in February 2019. The median sales price of the 10 House/PUD sales was $1,400,000 and the average sales price was $4,201,700. In February 2019 the median sales price of the 6 Condominium sales was $545,000 and the average sales price was $491,500. The lowest priced Carpinteria sale in February 2019 was a Condominium on Bailard Avenue @ $415,000 and the highest was an oceanfront House on Padaro Lane @ $18,125,000.
In Summerland there were 3 sales in February 2019. The median sales price of the 2 House/PUD sales was $1,900,000 and the average sales price was $1,900,000. In February 2019 the median and average sales prices of the 1 Condominium sale was $799,000. The lowest priced Summerland sale in February 2019 was a Condominium on Banner Avenue @ $799,000 and the highest was tied between a House on Ridgecrest Drive and a House on Toro Canyon Road which both sold for $1,900,000.
In Montecito there were 10 sales in February 2019. The median sales price of the 9 House/PUD sales was $4,400,000 and the average sales price was $4,833,056. In February 2019 the median and average sales prices of the 1 Condominium sale was $1,568,000. The lowest priced Montecito sale in February 2019 was a House on Chelham Way @ $930,000 and the highest was an Estate on Hot Springs Road @ $14,500,000.
In Santa Barbara there were 44 sales in February 2019. The median sales price of the 32 House/PUD sales was $1,126,000 and the average sales price was $1,445,797. In February 2019 the median sales price of the 12 Condominium sales was $895,000 and the average sales price was $1,038,208. The lowest priced Santa Barbara sale in February 2019 was a Condominium on W. Gutierrez Street @ $530,000 and the highest was a House on Lasuen Road @ $4,700,000.
In Hope Ranch there were 16 sales in February 2019. The median and average sales price of the 2 House sales was $4,555,500 There are no Condominiums in Hope Ranch. The lowest priced Hope Ranch sale in February 2019 was a House on Mariposa Drive @ $2,611,000 and the highest was an Estate on Cresta Avenue @ $6,500,000.
In Goleta there were 42 sales in February 2019. The median sales price of the 24 House/PUD sales was $1,060,500 and the average sales price was $1,206,438. In February 2019 the median sales price of the 18 Condominium sales was $559,000 and the average sales price was $580,333. The lowest priced Goleta sale in February 2019 was a Condominium on Dearborn Place @ $418,000 and the highest was a new House on Cambridge Drive @ $2,595,000.
Analysis
A limited supply of available properties along the South Coast of Santa Barbara County is keeping values higher than one might expect as compared to many inland areas of California and most areas of the United States. While the appreciation rate along the South Coast has softened, there are still a few areas where multiple offers are commonplace (9 offers were presented on one of my listings in February and it sold 28% over the asking price). On the South Coast of Santa Barbara County as of March 1st there were 378 active House/PUD listings (from 329 in February) and 107 active Condominium listings available for purchase (down from 119 in February). Generally, there is much more inventory available in the higher price ranges than in the lower ranges as 106 (28%) of the 329 active House/PUD listings are located in Montecito and Hope Ranch. Compare these low totals to the years 2007 to 2011 when the total number of available listings ranged between 734 and 1,026. Historically the highest number of available listings along the South Coast was recorded in June of 1992 when there were 1,297 listings available for sale, which was a lot of inventory for Buyers to choose from.
There have been no bank owned sales on the South Coast of Santa Barbara since September 2018, but as of March 5th there were two bank-owned listings in escrow: a house on Alameda Avenue @ $703,500 and a house on Cuna Drive for $1,200,000 (the same two as in February). There are now three bank-owned listing available for sale: a house on Bel Air Drive for $950,000 (just reduced from $1,030,750), a house on Portesuello Avenue for $1,250,000 and a Condominium on N. La Cumbre Road for $635,000. During the last few years, the foreclosure activity along the South Coast of Santa Barbara County has diminished dramatically. CoreLogic’s latest (October 2018) reports that the national mortgage delinquency rate is now at its lowest point since September 2006: http://blog.rismedia.com/2019/delinquency-rates-drop/ . Also check out California’s foreclosure list by RealtyTrac: California Foreclosure Trends by County .
As of January 2019 (the latest data available from CoreLogic), the highest recorded County median sales price in California was in San Mateo County @ $1,159,000 (down 5% from 2018) and the lowest recorded County median sales price was in Siskiyou County @ $147,955 (down 9.8% from 2018). The median sales price in the County of Santa Barbara was $544,250 (up 20.9% from 2018) and the median sales price in the City of Santa Barbara was $1,198,500 (up 17.1% from 2018). The lowest median sales price recorded in any California city was in Seeley in Imperial County @ $50,500 (down 56.1 from 2018) and the highest was in Stinson Beach in Marin County @ $5,200,000 (up 106.9% from in 2018). You could buy 103 median priced houses in Seeley, 9.6 in the County of Santa Barbara or 4.3 in the City of Santa Barbara for the same price as 1 house in Stinson Beach. If you care see what you can buy in Seeley for $145,000 check out https://www.realtor.com/realestateandhomes-detail/1735-Alamo-St_Seeley_CA_92273_M16761-45163 . If you care to see what you can buy in Stinson Beach for $2,150,000 check out https://www.realtor.com/realestateandhomes-detail/14-Dipsea-Rd_Stinson-Beach_CA_94970_M29905-42318 .
The Federal Reserve (the Fed) last raised the short term lending rate to banks to 2.5% at their December meeting. At the late January meeting, Chairman Powell said there were “conflicting signals” about the economy and many were negative and also that the Fed has “the luxury of patience”. On March 5th Boston Federal Reserve President Eric Rosengren said “It may be several meetings of the Federal Open Market Committee before Fed policymakers have a clearer read on whether the risks are becoming reality — and by how much the economy will slow compared to last year,” and then adding “patiently watching” is the best Fed policy for now. The 30-year mortgage interest rate also declined to as low as 4.125%, the lowest rate since last April and far down from 4.94% last November.
Of the 116 sales in February 2019, 59 sold for over $1,000,000 which equates to 51% of the total sales, up from 28% in January, down from 52.1% in December and up from 44.4% in November. 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. Of the 116 sales in February 2019, 28% (32) were cash transactions.
On February 26th the Conference Board reported that the Consumer Confidence Index stood at 131.4, up from 121.7 in January and 126.6 in December. The highest recent Index levels were 136.4 in November 2018 and 137.9 in October 2018. Lynn Franco, Director of Economic Indicators at the Conference Board, stated: “Looking ahead, consumers expect the economy to continue expanding. However, according to The Conference Board’s economic forecasts, the pace of expansion is expected to moderate in 2019.” The highest historical Consumer Confidence level was last seen in September 2000 when the Index stood at 142.5.
As for the cost of living, Numbeo compiles data for its cost of living index for major cities in the Western Hemisphere. Numbeo’s indices are relative to New York City, which means that for New York City, each index should be 100%. If another city has, for example, rent index of 120, it means that on an average in that city rents are 20% more expensive than in New York City. If a city has rent index of 70, that means on an average in that city rents are 30% less expensive than in New York City. The highest City index on the 2019 list was New York @ 100, the highest City Index in California was San Francisco @ 91.67, the lowest City Index in California was Bakersfield @ 67.35, the lowest City Index in the United States was Boise, ID, @ 58.85 and the lowest City Index on the list was Caracas in Venezuela @ 25.01. Santa Barbara’s 2018 City Index came in @ 79.17. This is a very interesting comparison list to check out: Cost of Living in the Western Hemisphere . The highest international city of the list was Basel, Switzerland @ 131.37 and the lowest was Rawalpindi, Pakistan @ 18.91.
For February 2019, data from Realtor.com indicates that 8 (up from 7 in October, November, December and January) of the 20 Hottest Housing Markets in the United States were in California, ranging from Chico @ 96.32 as #2 to Santa Cruz @ 85.79 as #19. It is interesting to note again that all of California’s Hottest Housing Markets were located in the Northern part of the state. Santa Barbara came in as #3079 on the list @ 75.46. https://www.realtor.com/research/reports/hottest-markets/
Historically the highest January-February median sales prices recorded on the Santa Barbara South Coast were recorded in 2007 at $1,032,500. The January-February 2019 median sales price was $1,025,500, down from $1,066,500 in January. The current median sales price has now been hovering near those historic highs for most of the 2017 and 2018 years, which would indicate a leveling off in market values.
As of March 1st in Goleta there were 52 active House/PUD listings and 28 pending sales, which equates to only a 1.9 month supply of listings for Buyers to choose from. Generally under 3 months of inventory would be considered a Seller’s market and lower than 2 months points to a feverish Seller’s market. Historically a 4 to 5 month supply of available inventory would indicate a well-balanced market between Buyers and Sellers and typically over a 6 or 7 month supply would be considered a Buyer’s market with multiple listings to choose from. Based on Santa Barbara Multiple Listing Service data and as of March 1st, Carpinteria/Summerland had a 7.6 month supply, Montecito had a 7.4 month supply, Santa Barbara had a 2.8 month supply and Hope Ranch had a 12.8 month supply. These inventory statistics indicate that the Santa Barbara, Hope Ranch and Goleta markets are still tilting in the Seller’s favor and the Carpinteria/Summerland and Montecito market are tilting in the Buyer’s favor. With a total of 102 House/PUD pending sales and only 378 active listings on the South Coast of Santa Barbara County, there is only a combined 3.7 month supply (same as in February) of House/PUD listings for Buyers to choose from. With a total of 55 Condominium pending sales and only 107 active listings on the South Coast of Santa Barbara County, there is only a 2 month supply (down from 2.6 in February) of Condominium listings for Buyers to choose from. It is too soon to know how the Montecito disaster will affect the Montecito values in the very long term, but pressures on Hope Ranch and the upper price rangers of Santa Barbara and Goleta housing supply still seems to be very evident. Buyers do seem to be moving much more cautiously than they did just a few months ago and some are taking their time assessing all their options along the South Coast of Santa Barbara County.
The ramifications of the Federal tax cuts, planned increase in government spending, limits on mortgage interest deductions, rising insurance premiums, the trade tensions between China and Europe, the Federal $10,000 limit on State tax deductions and the memories of the fire damage & debris flows in Montecito are a concern to many Buyers along the South Coast of Santa Barbara. The median sales priced Santa Barbara home would translate to a real estate tax of $14,190+/- per year. Other tax cuts may offset this limit deduction, but this would be a good time to meet with your CPA or financial advisor for advice on these issues. Only time will tell how these new tax rules will play out and how they will affect our real estate values. Supply and demand dynamics have and will continue to affect the South Coast of the Santa Barbara Real Estate Market for a long time to come.
Feel free to contact me with any real estate related questions.
Stan Tabler, CRS, GRI, ABR, GREEN
Compass
1002 Anacapa Street
Santa Barbara, CA 93101
805.689.2305
CalBRE Brokers License #00774377 since 1980
Realtor of the Year
Leave a Reply