Friday
Jul082016

2016 FIRST HALF ~ RIVIERA REAL ESTATE REPORT

2016 FIRST HALF  ~  RIVIERA REAL ESTATE REPORT

 There is no question that the Riviera real estate market has been robust in the first 6 months of 2016.  However, when I compiled the data earlier this week the actual numbers in terms of closed sales and median price increase far exceeded my expectations.  With a total of 54 sales and a stunning 23% increase in the median price to $1,975,000, the Riviera may well be the best performing sub-market in the entire Santa Barbara south coast.

  Without bursting anyone’s bubble I should point out that while the median price is the best gauge for assessing the direction of the market, it can be skewed based on the price point at which the majority of sales are taking place.  In this case while the number of sales in the $1 - $2 million range is similar to the first half of last year, there were no sales below $1 million and 8 more sales in the $2 - $4 million range.  This helps explain the dramatic median price spike in the Riviera market—the actual increase in home prices is much closer to the overall Santa Barbara south coast number of about 5%.  This is important for potential sellers to know because there is a tendency to overprice properties when there is a perception that the market has escalated beyond what is actually taking place.  There is evidence of this currently, as much of the existing inventory has been lingering on the market for longer than it should and several of the pending sales have experienced price reductions before going into escrow.

 My expectation for the second half of the year is that the pace of sales will slow down, but the median price will remain close to the $2 million mark.   The main reason for this prediction is that the current inventory is skewed toward the higher price ranges, and the “entry level” homes on the Riviera appear to be almost nonexistent any more.  An intriguing trend that is contributing to this market dynamic is the resurgence of the home renovation buyers who are bringing some very exciting properties to the market.  There are currently a handful of high quality rebuild and/or new construction homes in the $2.5 to $6 million range along with a few more that will be coming on the market soon.  I will have more analysis about how this will affect  the Riviera market in my year end article.

Thursday
Jan142016

2015 YEAR IN REVIEW ~ RIVIERA REAL ESTATE REPORT

2015 YEAR IN REVIEW  ~  RIVIERA REAL ESTATE REPORT

 

2015 is officially in the books. While some may be disappointed with a 6% decline in the median price compared to the previous year I would consider 2015 to be one of the best years in Riviera real estate sales that we have witnessed in quite some time.  The reason for this is that for the first time in almost 10 years the market did not particularly favor either buyers or sellers—it was a market that can best be described as “balanced”.

 A closer look at the numbers from 2015 reveals a very healthy market. The total number of sales were 12% above 2014 and reached a level that we haven’t seen since 2012 when the market was just beginning its recovery. The majority of the increase took place in the $1 - $2 million range with very little change in the number of sales below $1 million and above $3 million compared to 2014.  The main reason the median price dropped from $1.7 million to $1.6 million is because the market was robust in the middle price ranges,  and due to the balance between buyers and sellers there was no pressure on prices in either direction.  The benefit to this kind of balance in the market is that it should lead to a level of sustainability for the foreseeable future.

 My hope and prediction for this year is that the Riviera real estate market will continue on the path of robust sales combined with balance and sustainability.  Without the concerns of an “overheated” market that we witnessed in 2007 - 2008 or the uncertainty that was prevalent between 2009 & 2011 the market is ripe for steady growth which will be advantageous for both buyers and sellers.