Each quarter we offer a market update that goes beyond new listings and sales. The actual pulse of the market is always more nuanced than just the numbers and we strive to always bring you the most meaningful information on what is happening in luxury real estate.
As we close out Q1 under state-mandated stay-at-home orders, there is really just one topic on everyone’s mind: COVID-19 and how is it affecting the market. Before we get into that, let’s look at the general overview.
Year to date there has not been any closings in the $10M+ price range; the highest Q1 sale in Montecito was 1237 E Mountain Drive, which closed at $7,550,000.
Q1 2019 was a different story with 5 sales over $10M in the first quarter from Carpinteria to Hope Ranch; the highest Q1 sale was in January 2019 at $27,000,000.
At first glance, it would appear that the market has softened. But did it?
Let’s compare year over year for Montecito.
Q1 Total Sales
Q1 $10M+ Sales
Q1 $5-10M Sales
Q1 $3-5M Sales
Q1 $3M- Sales
Though the high end was soft compared to last year, there was considerably more strength in all other aspects of the market. Interestingly, the three highest sales of Q1 happened outside of Montecito; two were in the city of Santa Barbara (3511 Sea Ledge closed for $8.3M and 365 El Cielito closed for $7.6M) and the other in Hollister Ranch (108 Hollister Ranch closed for $8.250M). We see these sales as additional signs of overall market strength.
So now to what has been on everyones’ mind, feeds, and tv screens: COVID-19.
Though things are changing rapidly, we thought we’d give you a sense of what we’ve been seeing in the last couple of weeks. Spoiler alert - thus far, the market has remained active.
It certainly hasn't been business as usual since California's shelter-in-place order was issued. The good news is that residential real estate is considered an essential business in Santa Barbara County. That’s not the case in all counties throughout California, which do not consider real estate to be essential and which have shut down all in-person real estate activities. Though overall activity has decreased dramatically, over the last two weeks we put two homes in escrow, two buyers released all contingencies, and another asked to close early. We have had buyers, both local and out of town, looking at properties in a variety of price ranges. As you can imagine, people who are looking to escape urban settings are turning to the space and peaceful setting Montecito has to offer. Some have requested to see property in person and others are requesting virtual showings. Safety is paramount and we have specific protocols for in-person showings that adheres to CDC guidelines and protects all parties involved. In addition to the activity listed above, we have also seen some negotiations pause, buyers postpone or cancel showings, and had two escrows cancel.
As of 3/19/20, the date of California’s shelter-at-home order, Montecito had 14 properties cancel or withdraw from the market. At least two of these listings had tenants in residence and four of these withdrawn/cancelled listings were immediately put back on the MLS as a “Coming Soon” listing.
“Coming Soon” is a new category of MLS listing (like active, pending, or sold) that does not syndicate to public real estate websites like Zillow, Trulia, or Realtor.com nor does it accumulate a days on market count. For more information about Coming Soon listings or to receive them in real time, shoot us a note and we can put you on our exclusive mailing list.
We have spoken to a number of colleagues (locally, statewide, and nationally) to see what they are experiencing and to strategize on how we can best help our clients and our community. Across the board, though activity is down, there is a general sense of optimism. Housing remains something that is required in periods of change and in that respect, this time will likely be no exception. Though activity is slow, we, and many of our colleagues simply see this as a delay in activity. We anticipate that Montecito's appeal will only increase as people decide to leave more urban areas and some of our second home neighbors choose to make Montecito their primary residence. Additionally, as we all adjust to the ease and convenience of teleconferencing, the possibility of working "remotely" will likely open up Montecito to a new buyer pool who may not have considered our community due to proximity from their companies.
This is all evolving in real time and our next update will likely look completely different given the ongoing evolution of the situation.
The one good thing that may come out of all of this is that people are spending more time at home and likely more time online (dreaming about being in Montecito!). As mentioned, we are hearing from people all over the country who are keeping an eye on Montecito. We believe that once this settles down, Montecito will be even more desirable. There is a sense of peace, ease, and safety here that we believe will only be more alluring when we emerge from this situation. If nothing else, everyone seems to know how special Montecito is, and that there is no better community to shelter-in-place in than our beautiful town!
Be safe, stay home if you can, continue supporting local businesses however possible, wash your hands often, and above all else, we wish you good health.
Sending love and hope from our families to yours,
Riskin Partners