Tag Archives: Santa Barbara Real Estate

Santa Barbara Real Estate Remains Strong

One of Cristal Clark’s newest listings is a single-level French Country-style home in Birnam Wood designed by Michael L. Hurst, combining contemporary finishes and amenities with French Country elegance. Ms. Clark has remained busy throughout the pandemic, with an average of 10 or more showings a week.

Despite economy, Santa Barbara agents are busier than ever

When Santa Barbara County was sent into lock down in mid-March to combat the growing coronavirus crisis, the residential real estate industry held its breath and expected the worst. Buyers and sellers faced serious fears as jobs were in jeopardy and the prospect of opening one’s house to strangers kept homes off the market.

“Basically in both directions buyers and sellers backed off. It became a real concern,” said Village Properties owner Renee Grubb.

Now it appears those fears have been alleviated.

Over the last two months, real estate activity has remained strong in the Santa Barbara area, and agents are busier than ever despite the transition to virtual showings.

Natalie Grubb of Village Properties at one of her listings on the Mesa. Village Properties is preparing to reopen their offices after two months, while continuing to utilize virtual tours.

“I would have to say at least for now things are getting better. When I go on my calls for the California Association of Realtors, and they report on all of California, it’s looking better everywhere,” Ms. Grubb told the News-Press.

“I chose not to lay off any of my staff, and I feel fortunate that now the market is doing better and so my losses haven’t been as great as I thought they were going to be, which makes me happy of course.”

At the end of March and going into April, the forecast was bleak. Village Properties saw a significant dip in closings and properties fall out of escrow. Compared to 2019, they saw a 50% decline in business.

“Things started to pick up around mid-April. I think more people had gotten used to what was going on. We’ve been doing this for a month,” said Ms. Grubb.

“You never know until they close of course, but there are showings of high-end properties three, four, five times a week now. That kind of high-end activity actually started maybe two and a half to three weeks ago to where my agents who sell high end have been very busy.”

While the flurry of activity has been surprising, some agents, like Cristal Clark, did not even see business slow.

“For me there was no lag time,” said Ms. Clark.

“It was constant. I mean long hours working. It’s been nonstop.”

Ms. Clark was concerned at first, but soon saw a lot of interest from buyers from Los Angeles and San Francisco, especially in the under $10 million market.

“I think people want to be here. They see the beauty that Montecito and Santa Barbara has to offer and they’re not thinking about ‘I’d love to live there in the future’. They’re really putting it into place now, be it primary homes or secondary homes,” said Ms. Clark.

Kyle Kemp, district manager for Berkshire Hathaway, believes the slowing of activity in the first week was in part due to the uncertainty around using virtual tools to conduct business. Fortunately, many of his agents were already well versed in digital showings, and those that weren’t quickly caught on.

Lorie Bartron of Bartron Real Estate Group, a real estate team under Berkshire Hathaway HomeServices California Properties, shows off a property at 1060 Cieneguitas Road. Despite a short setback, Berkshire Hathaway is back on track for breaking its record for best year ever.

Although they were down 60% in sales in the first week, Mr. Kemp said his agents have rallied and are now only 20% behind, with a 206% increase in property inquiries in California compared to 2019.

“Once that stopped everybody started to feel comfortable, started to get their feet on the ground, realized Santa Barbara wasn’t going anywhere, the sun wasn’t going away, and all of a sudden people started coming back to real estate again,” said Mr. Kemp.

Mr. Kemp said most buyers seem to be in the technology sector, interested in getting out of Los Angeles and San Francisco and into the open spaces of Santa Barbara and Montecito.

“Those buyers don’t seem to be affected. In fact, a lot of them are telling us their businesses are doing better. We’re hit by the service industry for sure, because Santa Barbara is such an escape for everybody, so we tend to have a lot of hospitality, but that hasn’t for some reason affected the real estate,” said Mr. Kemp.

While the majority of interest and sales have been from California, agents are speaking to a lot of buyers from around the country looking to purchase homes in the area as soon as it is safe to travel.

“There are a lot of clients who want to live here, but they live somewhere where they have to take a plane ride, so they’re just kind of waiting until their areas open up more and they feel comfortable coming. I have a lot of clients coming next month in June from different parts of the U.S.,” said Ms. Clark.

“We would be selling houses all day long if people could get here physically,” said Mr. Kemp.

“They can do as much as they can do on a visual tour but if you’re going to spend $3 to $10 million on a property, you kind of want to walk around it.”

The biggest issue for agents has been a lack of inventory. Going into 2020, there was already a shortage of houses on the market, and the number of sellers has not increased to meet the demand seen in April and May.

“I am seeing every agent overloaded with a large number of buyers and not a lot of houses to sell. We haven’t seen anything happen on prices, where I thought for sure we would see some kind of trend downwards because of what was going on, and that was absolutely not happening,” said Mr. Kemp.

Natalie Grubb of Village Properties at one of her listings on the Mesa. Village Properties is preparing to reopen their offices after two months, while continuing to utilize virtual tours.

Natalie Grubb of Village Properties at one of her listings on the Mesa. Village Properties is preparing to reopen their offices after two months, while continuing to utilize virtual tours.

This is especially true with houses on the market for $1 million and under, which agents can’t keep on the shelves. If it’s a good house, priced well and in good condition, agents are fielding multiple offers.

“It’s great for sellers, a little tough for buyers. Ultimately sellers are thinking, ‘Well, should I put my house on the market?’ It’s actually a great time because there’s no competition. If you’re a buyer, buy sooner than later because when this really gets going I think there’s more buyers than sellers, so I think we’re going to have a tough market again,” said Mr. Kemp.

Despite a rocky March, real estate agents are preparing for a surge in interest as more people adjust to home buying during COVID-19 and are anticipating a good year for business.

“I think if we’re down at all it will be single digits. If we’re down by any percentage at all it will definitely be single digits, and it’s very possible that we’ll end up matching or coming very very close to what we did last year, and it was a good year last year. I think these last few months will tell, but if it continues I’m pretty optimistic that we’re going to end up in a good year,” said Ms. Grubb.

Source: by Christina Whittle | Santa Barbara News Press

California And Santa Barbara Median Home Prices Hit New High in May

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California’s median home price reached a new high in May at $600,860, surpassing its previous peak of $594,530 11 years ago.

Home sales declined by 1.8 percent from April and down 4.6 percent compared to May 2017 levels.

May marked the first year-over-year sales decline in four months and the lowest sales level in more than a year.

In Santa Barbara, median home price reached a new historic high in May at $1.2 million, while inventory continues to remain low.

“The softening in May home sales was due in part to the spike in interest rates in mid-April, when the 30-year fixed mortgage rate jumped 20 basis points in just one week to reach the highest level since 2014,” said Steve White, California Association of Realtors president.

“Homebuyers may have postponed escrow closings to wait out the effects of the rate surge,” White said.

“Additionally, the specter of rate increases earlier in the year may have pulled sales forward into the first quarter, which resulted in the subpar performance in the last couple of months,” he said.

“Looking ahead, higher mortgage rates and elevated home prices will heighten affordability constraints that will likely temper the housing market in the coming months,” he said.

Source: By Andy Alexander | Noozhawk

The Mythical Housing Affordability Crisis

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California is expensive to anyone who wants to move here, but is that a “crisis”? State Treasurer John Chiang and the bureaucrats in Sacramento want you to believe this so they can add another 5 million people to the state, and they don’t want to stop there. More people everywhere, more cars on the jam-packed streets and freeways, more kids in already crowded schools, more water resources drained, more pollution, and more environmental damages. The character and nature of our state and every community changed forever. Sacramento wants them to live in your neighborhood. Why should we let them ruin the good thing we’ve sacrificed for?

Let’s examine homeownership affordability in the state. According to records from the California Association of REALTORS, their Affordability index is currently at 34, meaning 34% of California families – using traditional metrics – can afford to buy the median priced California home. In the past 28 years, this index has been as low as 22% in 1991 and as high as 56% in 2012. For comparison, the national affordability index is at 60%. So California is expensive, but it has been for decades. If home ownership, currently 54% in California, were truly unaffordable we should be seeing massive mortgage defaults. But only 1.41% of California mortgages are at risk of foreclosure, meaning 98.59% of California homeowners with a mortgage are affording them. Does that sound like a crisis or a reason to add another 5 million people to the state?

The definition of “unaffordable” is “too expensive for people to be able to buy or pay for.” At California’s current median price, homes are selling so fast the current statewide inventory of unsold homes would last only 3.5 months if new inventory didn’t regularly come on the market. This sales pace is with nearly every loan requiring very strict qualifying standards.

State Treasurer Jon Chiang wants your community to grow because not everyone who wants to live in it can afford it. There will always be people who can’t afford to live wherever they want. I would love to live in Montecito, so should Sacramento make that affordable for me, for everyone else in the state, or in the country? The state is not one median house price. It has expensive areas and cheap neighborhoods, many a relatively short commute between. In Santa Barbara county the median price on the south coast is $1,200,000 for a single family home. Less than an hour away in Lompoc the median single-family home sales price is $310,000 and two bedroom apartments that rent for $1,950 a month in Santa Barbara go for $1,050 in Lompoc. But of course, there are still people who can’t afford even that. Though renters tend to stay in a residence for a median of 4 years, but up to 40% move in less than a year and they can leave for more affordable digs with just a 30-day notice.

So, maybe California isn’t for everyone? But should it be? Should we have everyone in the United States living here? Maybe there are better opportunities in other parts of our great country for those who find us too expensive? According to Bloomberg median price for starter homes in Atlanta, GA is $87,000; St. Louis, MO $65,000; and Detroit, MI $33,075. Many homes can be had for less! Employment is even more plentiful than in California with the unemployment rates for these cities averaging 5.3%. My best friend from Dos Pueblos High School in Goleta moved his wife, who grew up in Ventura, and their two children, to Colorado Springs for a more affordable home purchase. A close friend from Goleta Valley Junior High moved to Dallas and found a wife, job, and homeownership. One of my brothers, who grew up Santa Barbara, is very happy with his family in Denver, owning a $450,000 home that would cost at least $1,300,000 in Santa Barbara.

If you don’t build them they won’t come, and the ones who can’t afford to live here will move to less expensive communities. Let’s not spoil the good state we have to make Sacramento and developers happy.

By Edward Muller | The ECSB