How Hot is Today’s Market?
The Montecito Heat Index identifies demand for Montecito single family homes. By measuring buyer contracts (pending sales) rather than sales (closed escrows) lagging typically thirty days, the Heat Index provides a forward-looking indicator of both market strength and direction. It also shows us the price point(s) where value is most recognized by buyers and the properties scheduled to close escrow. Today’s Heat Score is compared to this date last year. All data are from the Santa Barbara MLS and are uniformly deemed reliable.
Today’s Index registers 46, an increase of 39.4% over last year’s score of 33.
The price sector most in demand is the $3-4m sector with a score of 17 and posting an increase over last year of 183.3%. A big four-bedroom, four-bath Ennisbrook Casita with a main level master suite, guest suite, and two additional guest bedrooms including club houses, pools and tennis courts, represented by Dina Zertuche and Lori Bowles, pended at $3,975,000 in this sector.
The entry-level $1-2m sector scored a 3, underperforming by 300% from last year. The only property to sell in this group of 26 properties was on Spring Road. A gated 2000 sq. ft, walk to Butterfly Beach, 3bd/2ba, with short term rental zoning, represented by Ted Campell, went under contract at $1,495,000.
The $2-3m sector just outperformed last year posting a score of 10. A handsome ‘60s tradition 4/3 on lower Sycamore Canyon Road, represented by Barbara Koutnick, originally listed at $2,695,000 and last priced at $2,795,000, is pending in this space.
And the $4-5m sector with over twice the inventory of last year outperformed with a score of 12 and was our second most in-demand sector. Last year, it scored a zero with no takers. On Sycamore Canyon Road, an impressive four-bedroom, four-and-one-half-bath contemporary with a geometrical design, represented by Suzanne Perkins, is pending at $4,700,000. With twelve-foot ceilings and a long gallery hall, this contemporary provides the perfect venue for a large-scale art or design collection.
Inventory also greatly increased for the $5m and above sector increasing from 63 to 79. Immediately after the Thomas Fire this group dropped to just forty homes for sale. Today it scores a 6 matching last year’s score with five properties under contract and all under $7m. Not on the market for decades, one of the few remaining original Spanish Colonial Montecito estates with well preserved period architectural details designed by renowned early Santa Barbara architect Mary Craig, and represented by Colleen Beall, a six-bedroom, six-bath estate on nearly three acres overlooking the Valley Club, last priced at $6,900,000, is on its way to closing.
Once again, and counter to most recent market trends and predictions, today’s demand and year-over-year metrics are higher in every important category; demand is nearly 40% higher, Median Sales Price is up 9% and the Average Sales Price is up a big 34% to $4,968,000. And, where sales numbers are nearly weakening everywhere else, our sales over last year rose by a remarkable 37%, much ahead of national, regional, and our surrounding locale’s numbers. Contrast to Hope Ranch with the same Median Sale Price as ours – and to be fair data is thin – sales are down 11%.
The California Association of Realtors is predicting that many buyers will continue to back away from too few choices and too high prices. Leslie Appleton-Young, C.A.R.’s well-regarded Chief Economist, believes sales throughout California will drop 7% this year with little or no Median Price Increase. The upper-end markets, she warns, accustomed to receiving multiple offers soon after listing, will see longer periods on the market before finding a buyer. Hmm.
While Montecito entry and mid-level buyers are stepping back from admittedly increasingly pricey properties, all other price sectors here are finding considerable support. All things considered, one must conclude that Montecito continues to enjoy a strong, ascending market with Seller’s and not Buyers remaining firmly in control.
A changing market, however, even if minimal, provides opportunity. A bit of a coming slowdown with buyers enjoying a few more choices and slightly better prices after facing years of market rising prices will be a welcomed change for our entry and mid-level sectors and provide more time to back for the upper end.
