California exhibits one of the most expensive housing markets – Santa Barbara Market trends

by: Scott Westlotorn

The National Association of Realtors (NAR) released their most recent study of the real estate market and found San Jose to be the most expensive place to buy a home in the country. With a median home price of $1,085,000 followed by other California markets for comparison were San Francisco at $885,600 and Anaheim-Santa Ana at $742,200 all down from former peaks.

NAR uses statistics taken from 178 “Metropolitan Areas” in the US and provides a broad based sampling of home prices from primary markets. Secondary and tertiary markets such as Santa Barbara are not included in their study because they are not large enough to provide a broad sampling. If the Santa Barbara market were to be included it would have been one of the most expensive in the US where the median price for homes rose from $997,500 to $1,210,000 year over year.

Another study by Coldwell Banker which analyzes costs of a 4 bedroom 2 bath home in nearly 2,000 real estate markets in the US provides a more apples-to-apples comparison of prices. Not surprising California had 15 markets in the top 20, Santa Barbara ranked number 12.

Santa Barbara prices peaked however in January 2016 at $1,394,000. Since then home prices and the number of closed escrows have dropped while the number of new listings increased at higher prices during the period. This appears to have biased the number of sales and final prices downward. The number of sales (closed escrows) dropped to 625 this year from 708 in July 2015 and the list price to sales price ratio fell to 90% from 98% last year. The market is adjusting to a continuous rise in prices since 2012. Below is a chart of the current trend.

As we enter the second half of the year buyers are keenly aware of price appreciation and are looking for value. If you’re interested in selling your home please give us a call for a free market analysis of your property.