Low Housing Inventory: A Country-wide Epidemic

a montecito home currently on the market

After a stellar year in 2012, the real estate market is experiencing a historically low supply of listed properties all over the country. An article by CNBC’s Diana Olick discusses the current state of the market and cites several potential factors contributing to this painfully low inventory. According to Olick’s article, listings are down 17% over March 2012 and potential contributing factors include that many Americans owe more than their property is worth, so a move could incur a great expense, which discourages homeowners from listing their property. Also, as home prices rise, many potential sellers may be waiting to see how high the prices will go before listing.

However, despite the low inventory, the pending home sales index is up 7% over March 2012, predicting an increase in closing sales. Across the country, pending home sales are inching upwards with the west seeing a 1.5% increase and the south is up 2.7%. The east coast stayed the same and the midwest is up 0.3%.

With home prices rising and an abnormally low inventory, the market is experiencing a fantastic season for sellers! Riskin Associates, Montecito’s #1 selling agent represents properties of distinction in Montecito.

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Santa Barbara’s Diverse Residential Architecture

montecito residential architecture

Southern California’s residential real estate is often misconceived to be a sea of red-tiled roofs and “Mediterranean” style residences, but Montecito begs to differ. A quiet drive along any of our charming streets feels like a trip around the world, revealing a refreshing mix of architectural eye candy inspired by all corners of the earth. From historic English tudors to functional contemporaries, Santa Barbara and it’s surrounding communities of Montecito and Carpinteria offer a home to suit everyone’s style preference.

Above, check out a collage of some of the area’s most distintive homes, boasting unique architecture unparalleled by their neighbors.

Clockwise from top left:

This modern masterpiece was designed around ancient oak trees and offers gallery walls and abundant natural light, perfect for showcasing a collection of artwork; A French provincial style home is nestled behind iron gates opening to a bucolic, tree-lined drive; This incredible residence has been artfully infused with European finishes, 100-year old Tuscan roof tiles and antique French oak and limestone floors; A rustic mountain retreat awaits discovery in the hills of Carpinteria overlooking the Pacific coast; this historic English manor boasts a prestigious address in the heart of Montecito’s golden quadrangle; Spanish-inspired La Candelaria is a sanctuary of richly colored walls, unique coffered and wood-paneled ceilings.

First Quarter Update for Santa Barbara’s Real Estate Market

santa barbara real estate market activity chart

Median sale price of Montecito homes: $2.8M

Fellow Village Properties agent Carol Kruckenberg recently wrote an article for the Santa Barbara News Press which discusses the current state of the Santa Barbara real estate market, as well as reviews the market over the first quester of 2013. Carol sites a resurgence in the market based on a number of compelling factors, including the median list price for homes, which has risen 12% to $940,000 over last year. Low inventory has created a seller’s market, which according to the article means that listings should sell in approximately 2.2 months. Last year, there were 414 homes to sell, this year there is nearly half as many at 287 homes listed for sale. Going back to 2011, there were 511 homes for sale. More encouraging evidence of market recovery stems from a recovery financial arena as well; last year, 30% of homes for sale were “distressed,” meaning bank-owned or short-sale properties, this year less than half as many listings (12%) are “distressed.” Carol’s article also highlights the final sale prices of listings as evidence for a recovery in the area’s real estate market, the number of listing’s sold to date is the highest it’s been in the last five years, including last year’s banner year.

Carol’s article also provides a number of valuable tips to both buys and sellers entering into the Santa Barbara area real estate market. Below, an excerpt from the article highlights a few of Carol’s tips:

Here are some practical tips whether you are a buyer or a seller in this very active real estate market. If you are a seller, it is recommended that you hire a real estate professional to assist you through the process of selling your house/condo/mobile home.  If your agent has suggestions for you regarding the condition of the property, you will want to listen with an open mind.  It is best that you do not purposely underprice your property hoping for multiple offers; this strategy has been known to backfire.  With your agent’s help, come up with a realistic price for your home.  The important factors that guide pricing are location and condition.

If you are a buyer and need to finance the property you will be buying, get pre-qualified first.  This will tell you if you are financially capable of buying and the amount you can finance. It is recommended that you enlist the services of a real estate professional.  The agent will be able to keep you informed of properties that fit your specific requirements and may have the inside track on properties that may not be in the Multiple Listing Service.  The agent will then be able to guide you through the purchasing process.

The article makes sense of the market activity during the first quarter of 2013 in Santa Barbara’s residential real estate market while providing valuable information and recommendations for navigating one’s way through this most interesting seller’s market, and Santa Barbara’s #1 realtor team, Riskin Associates, applauds Carol’s insight into the market and her dedication to the industry.

Pacific Pride Foundation’s Royal Ball

Dina Landi and Rebecca Riskin of Riskin Associates support the PPF at the Royal Ball.

Dina Landi and Rebecca Riskin of Riskin Associates support the PPF at the Royal Ball.

Set on the bluffs overlooking the Pacific ocean, ten minutes north of our office in Montecito, the beautiful Bacara Resort & Spa hosted the Pacific Pride Foundation‘s annual Royal Ball. Event planner extraordinaire Merryl Brown created a magical evening full of surprise for over 500 guests. Rebecca Riskin attended along with partner Dina Landi of Riskin Associates to support the Foundation, which provides services to the HIV/AIDS and LGBT communities of Santa Barbara.

The event was hosted by an impressive list of honorary chairs including actor Neil Patrick Harris and his husband, Iron Chef Cat Cora and her wife and a number of other prominent members of the LGBT community and straight supporters. A feast for the senses, guests enjoyed a delicious offering of culinary creations including short ribs and onion rings resting atop a bed of mashed potatoes, elegantly served in martini glasses. American Idol alum Miss Frenchie Davis performed along with extreme stilt performers, torque acrobats and go-go dancers who wowed guests with their own incredible performances. Acclaimed LA DJ Mike Bryant ensured the dance floor was packed well passed the stroke of midnight.

Performers kept guests begging for more/

Performers kept guests begging for more!

The ball brought together a community of gay, lesbian, bisexual, transgender, and straight supporters to share an evening of fun and fundraising in support of the Pacific Pride Foundation. The Foundation is the only organization on the central coast providing the LGBT community with HIV and AIDS services and education as well as a number of important counseling services for members of the community such as sensitivity training for law enforcement and teens.

Southern Santa Barbara County Market Holding Strong

4-6-2013 SourhCort
Sales of residential real estate in southern Santa Barbara county continue to provide evidence of a recovering market. Compared to February, there were 23% more sales in March 2013. The first quarter of the year yielded 477 closed transactions while the first three months of 2012 yielded 410, a 16% increase in sales. With an incredible amount of success in 2012, Montecito real estate agent team Riskin Associates closed over $220 million and with the positive upswing the luxury market of Montecito is experiencing this year, the team is working hard to see another successful year. Check out the graph above for a visual representation of the sales in southern Santa Barbara county of the past six years.

Cash is King! (when buying a home)

Graph provided by DrHousingBubble.com

Graph provided by DrHousingBubble.com

They don’t say “cash is king” for nothing – and in residential real estate, nothing could be truer. In a time of unprecedented economic turbulence, the amount of all cash buyers if off the charts. A recent  article posted by DoctorHousingBubble.com  dissects the trends of home buyers and their preferred method of payment. According to the article, Wall Street investors as well as foreign buyers are dominating the market with all-cash purchases. In 2012, all-cash transactions in southern California hit a record high of 35.8% in December, and last month, that number was mimicked by 35.6%, much higher than historical norms. The article also explains that 31% of these buyers are absentee buyers, meaning they are not planning to live in these homes, and dating back to 2000, the monthly average of absentee buyers was nearly half at 17 percent. The graph above provides a visual description of all-cash transactions in specific markets across the country.

Home prices are rising!

An article by Realtormag.com reports that home prices have risen 10% year-over-year nationwide, the largest increase since 2006. This month also marks the 12th consecutive monthly increase of home list prices nationwide, “Nationally, home prices improved at the best rate since mid-2006, marking a full year of annual increases and underscoring the ongoing strengthening of market fundamentals,” says Anand Nallathambi, president and CEO of CoreLogic. California ranked 3rd in the country for highest price appreciation as of February 2013, with a 15.3% increase. Click here to view current listings offered by Montecito’s top producing real estate agent team, Riskin Associates.