Are Home Prices Falling,
or is the Market Just Normalizing?
Happy New Year! The 2023 national real estate market performed better than anticipated.
Numerous metropolitan areas navigated the transition from a strong seller’s market to a more balanced state. High mortgage rates caused a dip in both California home prices and the number of sales. New inventory was affected as homeowners with locked-in low-interest rates were reluctant to sell. Despite these challenges, the housing market remained competitive, with demand exceeding available inventory.
Here in South Santa Barbara County, the biggest takeaway is that the market has normalized and returned to a healthier pace. While inventory remains tight, with buyers still outnumbering sellers, prices have stabilized. Santa Barbara listings sold at an average of 97% of their asking price last year, very similar to the more balanced market we saw pre-pandemic.
2023 Real Estate Trends & 2024 Predictions
• Santa Barbara’s market is unique; we have a finite amount of inventory and major limitations on construction.
• 50% of Montecito & Hope Ranch sales were all cash. Cash is King again, especially when it comes to offer negotiations.
• Santa Barbara’s popularity continues to increase; instead of newcomers leaving, we’re seeing them buy larger homes here.
• The Fed is expected to hold rates steady and encourage the markets toward lowering their rates in 2024. Average mortgage rates are currently around 6%, 2% less than they were last quarter.
• If you’re a buyer, take advantage of the lower competition during Q1. The landscape will pivot as interest rates come down.
Montecito and Santa Barbara offers the most sought-after climate, lifestyle, real estate, outdoor activities, and culture worldwide. But what truly sets it apart is its people – a community characterized by passion, spirit, humility, and a shared commitment to living life to the fullest. In my three+ decades as a resident, I’ve witnessed the local magic, and I feel very fortunate to be running a business and raising my children here. My team and I believe in carefully monitoring local statistics, and we are watching the market closely to help ensure our clients’ goals are aligned with success in 2024. Stay tuned for our next quarterly market update in the Spring, where we will digest the first quarter statistics.
SOUTH SANTA BARBARA COUNTY STATISTICS
HOPE RANCH STATISTICS
WHO YOU WORK WITH MATTERS
COUNT ON OUR TEAM TO SUPPORT YOUR GOALS
Despite some challenges, 2023 proved to be one of our best because we were able to adapt quickly to the ever-changing market conditions throughout the year. Our commitment to helping our clients carefully navigate their real estate decisions remains our top priority. In order to succeed in this market, you need a diligent and dedicated team with extensive experience, strong relationships, and a consistent history of proven accomplishments.
Contact us at 805-565-4014 or email Home@MKGroupMontecito.com for a complimentary consultation. All calls are confidential.