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2025 YEARLY REAL ESTATE MARKET UPDATE

January 15th, 2026

 

2025 Real Estate Trends and 2026 Outlook

For those who spend time here, the appeal of the South Central Coast (Goleta, Santa Barbara, Montecito, Summerland, & Carpinteria) is immediate. A rare stretch of California coastline framed by mountains and sea, where each community offers its own character yet shares a common rhythm. From Goleta to Carpinteria, these are places people discover, fall in love with, and find their way back to.

Lately, I’ve been hearing a question from some of those considering our region. Did we miss the market? It’s a natural hesitation. Prices along the Santa Barbara Coast reflect both desirability and scarcity. But history tells a consistent story. This market has moved through cycles, yet long-term value has remained remarkably resilient. 

For many buyers, choosing this area is less about timing the market and more about choosing a way of life. A life defined by proximity to naturewalkable communitiescultural depth, and a pace that allows for both ambition and balance. It’s a place families grow into, establish traditions, and often pass down through generations.

In 2025, the South Santa Barbara County market continued to show strength across multiple segmentsMontecito posted gains across the board in 2025. The average price per square foot in Montecito is now $2,274/sq. ft. Santa Barbara's average price per square foot now averages around $1,221/sq. ft. with an average sale price of $2,560,052. Numbers matter, but what matters more is why they continue to rise. What sustains this market is not speculation. It is scarcityFinite land that cannot be recreated, natural boundaries and governing bodies that protect it, and a lifestyle that remains timeless and deeply livable

In 2025, there were 15 sales over $20 million, compared to 13 in 2024. The outlook for the luxury market remains strong. As long as there is a healthy selection of quality homes, the market is positioned to continue appreciating

Looking ahead, the broader economic landscape remains supportive. Nationally, inventory rose approximately 15% in 2025, with mortgage rates easing from roughly 7% to 6%. Optimism around innovation and global investment continues to support real estate markets with strong fundamentals. The upcoming World Cup and Olympic Games will further elevate Southern California on the world stage, bringing increased international attention to the region.

As we move into 2026, opportunities remain for both buyers and sellers in Santa Barbara County. 

Sellers, 2026 is shaping up to be another profitable year locally. With home values expected to continue rising incrementally, the winter market presents a compelling opportunity. Lower inventory levels create greater visibility for well-positioned properties and often lead to stronger buyer engagement.

For buyers, steadily rising prices suggest that acting sooner may be advantageous. At the same time, do not overlook homes that have been on the market longer. These properties can present meaningful opportunities, particularly for those willing to look beyond first impressions or consider strategic improvements

Whether you are just beginning to explore the Santa Barbara area or considering a more permanent move, understanding the nuances of each community is key. If you would like a personalized overview of the region, community comparisons, or an equity forecast for a specific property, please call or email us.

For a confidential consultation, contact us at 805.565.4014 or email us by clicking on the button below.

ALL Q4 SALES IN EACH AREA

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NOTE: This is not in any way an official advertisement or publication of these properties. Data from The MLS and CORT for October 1, 2025 to December 31, 2025 and represents properties listed or sold by various brokers. The MLS, CORT, and Marsha Kotlyar Estate Group do not guarantee and are not in any way responsible for its accuracy, and data maintained may not reflect all real estate activity in the market. If your house is currently listed, this is not intended to be a solicitation. Based on information obtained from the MLS as of December 31, 2025. Display of MLS data is deemed reliable but is not guaranteed accurate by the MLS. The Broker/Agent contained herein may or may not have been the Listing and/or Selling Agent.

©2026 BHHS Affiliates, LLC. An independently operated subsidiary of HomeServices of America, Inc., a Berkshire Hathaway affiliate, and a franchisee of BHH Affiliates, LLC. Berkshire Hathaway HomeServices and the Berkshire Hathaway HomeServices symbol are registered service marks of HomeServices of America, Inc. Equal Housing Opportunity. 

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