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Wednesday
Jan312018

2017 YEAR IN REVIEW ~ RIVIERA REAL ESTATE REPORT

2017 YEAR IN REVIEW  ~  RIVIERA REAL ESTATE REPORT

 One year ago I reported that 97 closed sales were the most that had been recorded in the Riviera within the last 10 years.  Furthermore, the median price had reached an all-time high of over $2 million.  Clearly 2016 was a benchmark year for the Riviera real estate market.  My prediction at that time was that this momentum would continue, and I can now report that this is exactly what happened as the final numbers for 2017 are also impressive.   The median price for the year was $1,925,000 which is actually about a 5% decrease from 2016, however the total number of sales hit a new high of 102!

 A closer look at the numbers illustrates why 2017 should be considered a banner year in the Riviera real estate market even though the median price did not keep pace with the previous year.  The biggest difference was that there was more activity in the lower end of the market in 2017.  The $1 - $2 million segment of the market produced 22% more sales along with 18% fewer sales in the $2 - $4 million range, however both years produced 5 sales in the lofty $4 million plus category.  Furthermore, the median price increase in 2016 was a bit skewed due to the abnormally large amount of sales in the higher end of the market that year.   The final median price in 2017 is still an impressive 17% above the level it reached just two years ago. Overall 2017 can best be described as a balanced yet robust real estate market characterized by a continuing increase in the number of sales combined with a sustainable level of appreciation.  

 At this time I don’t see any reason why 2018 will not continue on this path as long as the inventory levels remain healthy and sellers are realistic about the value of their homes.  There is no question that one of the reasons the number of sales declined in the $2 to $4 million segment last year was that many properties lingered on the market as the well-educated buyer pool did not chase overpriced listings.  The other potential wildcard in the Riviera market this year is that the demand may actually increase due to the recent fires and mudslides in Montecito.  Some of the people whose homes were damaged or destroyed have already purchased and/or are looking for homes in Santa Barbara.  This will be an interesting dynamic to keep our eye on as the year progresses.