Monday, February 8 , 2016, 11:58 pm | Fair 55º

Real Estate Sales Jump 41.6% in March in Santa Barbara County

Local market stirs to life with high-end South Coast properties leading the way even as county's median price drops 7.1% to $405,380

Santa Barbara County recorded 171 real estate transactions on the South Coast in March, with a median price of $640,000, according to Fidelity National Title & Chicago Title.
Santa Barbara County recorded 171 real estate transactions on the South Coast in March, with a median price of $640,000, according to Fidelity National Title & Chicago Title.  (Alex Kacik / Noozhawk photo)

By Alex Kacik, Noozhawk Business Writer | @NoozhawkBiz |

A recent increase in high-end real estate sales in Santa Barbara County bodes well for a housing market turnaround, local real estate experts say.

The total number of sales increased in the county by 41.6 percent from February to March, according to the California Association of Realtors. Much of that activity stemmed from the high-end market, said Sheela Hunt, an agent with Village Properties Realtors.

“It’s a good indicator that the market is coming around when the high-end properties start to move,” said Hunt, adding that it demonstrates a shift in consumer confidence.

Prudential Realtor Jake Ralston has noticed a lot of movement in Montecito as well.

“The deep pockets can move when thy want to, and they are now,” he said. “But jobs are still hard to come by and a lot of homes are upside down.”

Elaine Abercrombie of Abercrombie Fine Homes Inc. noted there is less supply and more demand. She said there was a 3.2-month supply of homes in the South Coast market in March and the median price of single-family homes dropped 7.1 percent, to $405,380 from $436,360 in Santa Barbara County year-to-date.

“We probably passed the bottom,” she said. “Will prices soften more? I don’t know but they have gone sideways for the past year. When I see inventory dropping at this rate, that’s a push on demand and prices will probably go up.”

Many buyers are beginning to understand that “there’s no question of whether the marketplace has bottomed or not,” Ralston said.

There were 171 transactions on the South Coast in March compared to 127 in March 2011, according to Fidelity National Title & Chicago Title data. The median price was $640,000 in March compared to $653,000 last year.

“Interest rates are at a 40-year low and prices are more affordable,” Abercrombie said.

Home prices hit new post-bubble lows in February, according to a Standard & Poor’s/Case-Shiller home price index report released April 24.

While the North County high-end market isn’t faring as well as the South Coast, they are both experiencing a high volume of sales in the low-end market, said D’Ann Bartley, Prudential California Realty agent in Santa Maria.

“There’s not a whole lot of inventory, rates are low and people are finally realizing that you can’t buy a home at bargain prices forever,” she said.

For those staying in Santa Barbara for more than five years, they should control their costs by buying a home, Abercrombie said.

“If they are paying $2,000 in rent, they can probably own something and control costs for rest the rest of their life rather than worry about rents going up,” she said.

“If we’re down to a 3.2-month supply of homes, then people can’t buy and rents will likely go up. The people I’m seeing who are buying are planning for the long term. They’re thinking inflation won’t go away and want to get set for the future.”

But there are several misconceptions, Bartley warned. Short sales aren’t big bargains and cash doesn’t translate to a discounted price, she said.

“The banks are not underpricing short sales,” Bartley said. “They price them at market value and that’s what they expect to get.

“Also, a lot of investors think that because they are offering cash, they should be getting a big discount. But they don’t care; they’re taking the best terms and the best price.”

Overall, the market’s recent uptick is a good sign, Ralston said.

“Prices have stabilized and will seemingly go up,” he said. “That’s great news for rest of economy even if we don’t see incredible appreciation in the fourth quarter.”

Noozhawk business writer Alex Kacik can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

Price Report 3-12


» on 04.30.12 @ 10:48 AM

The problem with thinking that prices have bottomed is that rates are still at historic lows.  What happens when rates start moving back up?  Answer: House prices go down.  Rates are absolutely going higher, and they are going a lot higher, starting probably as early as the second half of 2013.  The Fed has recently stated that they expect to start raising rates in 2014, but it could easily happen before that, if inflation looks a bit more threatening.  Look at where median home prices were at the bottom of the last recession for real estate (1993 through 1996) and you will see that prices were much lower.  The median home prices in Santa Barbara county dropped to about $170,000.  Rates were in the 8% range back then.  If rates move back up, which they will, prices must go down to maintain affordability.  This means that we are nowhere near a bottom for house prices, despite what homeowners want to believe.

» on 04.30.12 @ 01:35 PM

Absolutely correct.  Interest rates up… prices down.

If you have the money in pocket cash is king now and will be for the foreseeable future. 

At one time had a Broker’s lic. and was constantly amazed how both real estate offices and banks would get together to “engineer” sales to unqualified buyers.  All the while “banking” (pun intended) on inflation to pay the note after short term holding.  The result was and is multiple houses that are nothing more then bunk houses and 3 to four cars parked on the street since the garages are included in “bedrooms.”

Ironically some of the worst offenders in destroying Santa Barbara and the south coast congenial single family neighborhoods are government employees.  But then again they have no problems burdening the taxpayers with unreasonable pension and health benefits as they go off to new jobs double dipping.

As Craig points out the last recession was not nearly as bad a this one and the interest rates were far higher.  The other foot has yet to drop on this real estate market.

» on 04.30.12 @ 06:23 PM

Shush you two.  Ask any realtor-It’s a good time to buy!

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