Tuesday
Apr172012

2012 First Quarter ~ Riviera Real Estate Report

RIVIERA REAL ESTATE OVERVIEW ~ FIRST QUARTER 2012

After a relatively quiet final quarter of 2011 there is no question that the buyers are back in the market with renewed enthusiasm.  Since the first week of January there has not only been a marked increase in the number of buyers shopping, but more importantly a significant increase in those actually buying property.  In the first quarter of 2012 there were 21 closed sales in the Riviera and surrounding areas that I track.  At this pace the total number of sales for the year would far exceed the total for each of past 5 years! 

While this is encouraging news the other question I get asked all the time is what direction are prices going at this point.  This is always difficult to assess, but an analysis of the median price is generally the best barometer of pricing trends.  The final median price for 2011 was $1,350,000 which was 7% below the 2010 number.  So far this year the median price for closed sales is $1,050,000, however the median price for those currently in escrow is $1,395,000.  This suggests that lower end properties were the most popular choices for buyers in the first 3 months but now the higher end properties are beginning to gain traction.  Based on this data my assumption is that the median price will be very close to last year’s number at the midway point of the year.  So, be on the lookout for my mid-year analysis that I will publish in early July to see if my assumption is on target.

The other aspects of the market that are important to track are the percentage of “distress sales” and the length of time it takes on average for properties to sell.  Of the 34 properties that either sold or are currently pending there were only 4 “distress sales”.  This is an encouraging and positive number compared with the overall Santa Barbara market.  The average “days on market” for the properties that sold was 97 which is a bit higher than the overall market.  However, as I commented in my recap of the 2011 market the properties that are priced competitively are still selling fast and occasional generate multiple offers.  As always, I look forward to your questions and comments.

Tuesday
Jan312012

2011 Year In Review โ€“ Santa Barbara Riviera Real Estate Report

2011 Year In Review – Riviera Real Estate Report

There are several local Realtors and economists that report regularly on the status of the Santa Barbara real estate market.  My goal in this column is to focus specifically on the Riviera real estate market which includes about 2200 homes that stretch from the Mission to Montecito in the hills above the city.  While I will include statistics on the overall market that are useful in identifying trends, the primary focus is to share my thoughts on the Riviera real estate market based on my actual experiences in the field.  I will post a new blog at the end of each month with fresh and current content so that readers can stay up to date on the always dynamic Santa Barbara and Riviera markets.  

In reflecting on the Riviera market in 2011 my general sense was that buyers had the upper hand in negotiations, but sellers were in control on the highly desirable properties and/or those that were priced to sell.  I have included pictures of three properties above that exemplify this dynamic.  The first two are listings I had that both generated multiple offers within a few days of being on the market.  They exemplified the “desirable properties” mentioned above.  One was a vintage Spanish home on a prime view lot that needed updating but was priced to reflect its condition.  The other was a pristine, single level home on a desirable view lot in the Montecito Riviera that was priced slightly above market value.  The third property is a prime example of the fate of those sellers who insist on pricing their homes way above market value.  The market value of this property when it first came on was in the $2.3 to $2.5 price range.  However, the original list price was $3,450,000 and after a year of marketing and price reductions the final selling price was $2,000,000.  The moral to this story is that if a listing is priced correctly it will perform well, which is especially true in a “buyer’s market.”

In doing my research for this column I was pleased to confirm that the Riviera market has performed better than the overall Santa Barbara South Coast market in the last 4 years.  The median price for the Santa Barbara market has declined 37% since its peak in 2007, while the Riviera market has declined only 28% in the same period!  There are too many economic and political variables to make any reliable predictions for the 2012 market, but I can tell you for sure that the moral of the story mentioned above will be the key to success for sellers this year as well.  LISTINGS MUST BE PRICED CORRECTLY TO PERFORM WELL IN THIS MARKET!!  I look forward to your questions and comments, and please check back at the end of each month for the latest updates on the Santa Barbara and Rivera market pulse.