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Property taxes in Santa Barbara

April 15, 2014

Today is the day that income taxes are due, after which many people think about how well their current real estate deductions are working for them and if they’d be better off buying or selling a property. Santa Barbara along with other areas will see a lot of new housing market activity begin because of this recent attention to income tax deductions.

Speaking of taxes, depending on where you decide to own real estate can affect your property taxes tremendously. Santa Barbara County is covered under California’s Proposition 13 which was established in 1978 when it was overwhelmingly approved by voters. The proposition limits property tax to 1 percent of a homes assessed value, plus the rate necessary to fund local voter-approved bonds. Santa Barbara’s yearly property tax rate average calculates to around 1.1 percent with everything included. Prop 13 also limits the amount that your property tax can increase in California and Santa Barbara. An increase of 2 percent per year is maximum on properties not involved in a change of ownership or properties that did not undergo new construction. Newly acquired property is assessed at its new market value (usually the purchase price) and the value of any new construction is added to the existing base value.

Santa Barbara’s yearly property tax rate of 1.1 percent is very reasonable when compared with many other areas of the country. For instance, in Florida there are counties that top 2.3 percent in property tax rate and in New York and New Jersey there are several counties with property tax rates that exceed 4 and 5 percent.

Understanding all aspects, including taxes, of any real estate transaction you’re considering is important. I look forward to answering any questions you have and appreciate your inquiries!

Santa Barbara median back over $1M

April 1, 2014

It’s official, the median price for a home in the Santa Barbara area is back over $1M as of the first quarter this year. The last time Santa Barbara saw its home price median go over $1M for any quarter was in the second quarter of 2008. The first time it happened was in the second quarter of 2004.

Following is the progression of Santa Barbara’s quarterly home price median over the past two years.

2012: $810K; $815K; $839K; $833K
2013: $928K; $973K; $968K; $985K
2014: $1.097M

There’s still quite some distance between the most recent figure and the all-time high of $1.395M reached during the second quarter of 2007.

Amidst the current housing recovery the median home prices for Santa Barbara real estate have outpaced the rest of the nation, and it will be no surprise if they continue to do so. This can be attributed to the historically low inventory levels and high demand, however there’s another factor affecting the numbers. Tighter lending practices along with new regulations put into place by the Consumer Financial Protection Bureau at the beginning of this year has led to more and more entry level buyers having difficulty getting loans. Less entry level home sales contributes to a larger market percentage of high end sales. This allows median sale prices to rise even faster than home values.

It’s important to understand the market conditions and values of any area you’re considering buying or selling in. I appreciate the opportunity of providing you with the most up-to-date and accurate information regarding Santa Barbara real estate, and to assisting you with all of your most important questions and needs. Thanks for your inquiries.

What Buyers are looking for

March 18, 2014

In the most recent National Community Preference Survey conducted by the National Association of Realtors real estate buyers were asked what features they consider important when selecting a neighborhood to purchase a home. Following are the most popular responses along with the percentage of participants who agreed.

Privacy from neighbors – 86%
Sidewalks and places to take walks – 80%
High quality public schools – 74%
Walking distance to places such as schools and shops – 69%
Easy access to the highway – 68%
Established neighborhood with older homes and mature trees – 66%
Living in a community with people at all stages of life – 66%
Public transportation within walking distance of your home – 65%
Short commute to work – 65%
Living in a place that’s away from it all – 55%

Santa Barbara is fortunate to have a wide diversity of topography and neighborhoods within its city and surrounding areas. Each feature that buyers have stated are important in the survey can be found in one or more neighborhoods of Santa Barbara. For instance, privacy from neighbors is synonymous with Montecito, Hope Ranch, and the Goleta, Carpinteria and Santa Barbara foothills. Established neighborhoods with older homes and mature trees are prevalent in the Upper East, San Roque and many of the downtown areas. Sidewalks, bike paths and places to take walks are abundant near the beach and on the Mesa.

To be walking distance from places such as schools and shops and to be in an area of high quality public schools is important to many buyers. Two websites that are popular in rating these features are walkscore.com and greatschools.org. A great website that shares insightful information on walking in Santa Barbara is santabarbaracarfree.org. This site notes that Santa Barbara is designated as a Gold-Level Community by Walk Friendly Communities. Trail hiking is another great and widely enjoyed activity in Santa Barbara. A wealth of information on the subject can be found at santabarbarahikes.com. Two preferred websites for school information in the Santa Barbara area are sbceo.org and sbunified.org.

It’s my pleasure to assist you with the different features that Santa Barbara and its diverse real estate has to offer. I appreciate your inquiries and look forward to hearing from you.

Market changes in Santa Barbara

March 4, 2014

The real estate market has certainly seen its share of changes along with new activity over the past several months. From increases in inventory to higher interest rates to newly implemented mortgage qualifying guidelines. These changes make good argument that sales should start slowing down.

We can track how fast a housing market is moving by measuring its absorption rate or market velocity. This is done by dividing the number of homes now available by the number of homes that have gone under contract over the past month. The ratio tells how long it would take for all homes on the market to sell at the current rate of sales.

Here’s a look at Santa Barbara’s current market velocity and how each price range has changed since last February.

For Homes and Condos:
Under $500K: 2.7 months of inventory (up from .3 months (9 days))
$500K – $1M: 2 months of inventory (up from 1.2 months)
$1M – $1.5M: 2.3 months of inventory (down from 2.7 months)
$1.5M – $2M: 11.2 months of inventory (up from 3.3 months)
$2M – $4M: 20.2 months of inventory (up from 8.7 months)
Over $4M: 21 months of inventory (down from 38 months)

Traditionally 1-4 months of inventory indicates a seller’s market, 5-6 a neutral or balanced market, and 7 or more a buyer’s market. Santa Barbara’s current numbers show a seller’s market for properties under $1.5 million and a buyer’s market for properties over $1.5 million.

For a more in depth look at the market you’re interested in I appreciate and look forward to your inquiries.

Highest priced zip code in California

February 18, 2014

Four of the ten highest priced real estate zip codes in the United States lie in California according to CNN Money Magazine. Second in California is 93108 which encompasses homes in both Montecito and Santa Barbara. The only zip code with higher prices in California is 90210 in Beverly Hills. The determination was based on the number of home sales of $5 million or more over the last 12 month period ending June 30th. Although Beverly Hills had more ultra-high end home sales than Montecito, Montecito’s median price of $2.4 million eclipsed the median in Beverly Hills by $400,000.

The article mentioned Montecito’s Mediterranean climate and cool Pacific breezes creating perfect weather as a big selling point. This certainly helped in the recent sale of 1755/1745 Fernald Point priced at $28 million. A modest 3 bedroom 4.5 bathroom house on 3.16 acres with building plans for a larger home.

You don’t have to purchase a property in the high priced 93108 zip code to enjoy what many consider to be the best living accommodations in California. There are nine other zip codes in and around Santa Barbara to choose from, and most currently have median home prices under $1 million. I look forward to providing you with great buying opportunities in all of Santa Barbara’s beautiful locations throughout the year and appreciate your inquiries.

Warm weather and real estate conditions

February 4, 2014

With 60 to 70 degree temperatures and plenty of sunshine forecast for the next two weeks it’s hard to think of a more pleasant place to look at real estate this time of year than in and around Santa Barbara. The only dilemma buyers are having is whether to choose from the limited supply of homes currently for sale or wait to see if inventory levels increase as the year progresses. Last year Santa Barbara’s home inventory reached its peak in October, while in 2012 and 2011 the peaks happened in February and July respectively.

Long time watchers of the real estate market in Santa Barbara pretty much agree that if a property becomes available that’s reasonably priced and close to meeting your needs don’t hesitate on making a decision. Chances are that the longer you’ve been looking for a particular property the more built up demand there will be from other buyers for the same home. When multiple offers arise it’s not uncommon for a long awaited property to sell for over the asking price to an all-cash buyer.

There’s no time like the present. Low interest rates, off-peak competition, and a reasonable number of homes to choose from. The current conditions may be just what you’ve been looking for. I appreciate your inquiries and the opportunity to be of assistance.

Exciting times for Santa Barbara

January 21, 2014

The Santa Barbara real estate market recently saw its slowest November and December as per number of homes sold since the big dips in 2007 and 2008. The lack of sales for these months can largely be attributed to the record low inventory levels that buyers had to contend with. The consensus from just about every long time Santa Barbara Realtor I’ve talked with in the past 6 months is that recent inventory levels are the lowest they ever remember.

The number of home sales Santa Barbara produces this year will definitely depend on the amount of inventory that becomes available. Documentation from the Santa Barbara Multiple Listing Service (MLS) shows that there were only 424 active listings two weeks ago for homes, condos, and land combined. Today the total is 453, a nice 7% increase, but far off levels reached in 2011, 2012 and 2013 when the number of listings rose to 958, 715, and 616 respectively.

Smart investing is said to be counterintuitive, which in real estate translates to: when no one else is buying you should buy, and when no one else is selling you should sell. The current housing conditions are certainly enticing then for savvy buyers and sellers to become more active. If this happens we can surely bet that this year’s sales numbers will be better than last.

I appreciate your inquiries and look forward to keeping you posted on what’s gearing up to be a very good year for the Santa Barbara real estate market.

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