Six Insights into the Selling Season

The weather forecast isn't the only telltale sign that Spring is in full swing here in Santa Barbara. It is 80 degrees and sunny this week and the housing market seems to be equally hot with the unwritten real estate law "Spring is the best time to sell a home" being fully enforced. With so much activity in the market, Riskin Associates would like to educate our clients and readers with some insights into the current state of the market.

This quintessential Santa Barbara home offers the coveted, coastal lifestyle with ocean and mountain views and an enchanting landscape.

Firstly, the long, cold winter is finally over. The Polar Vortex quite literally froze the market and as the East and North East melts back into action, buyers are ready (and more motivated thane ever!) to relocate or purchase second residences in sunny California. Additionally, the rule rings true that spring and summer are THE time of year for real estate transactions. According to Trulia.com, sixty percent of all homes will be bought and sold between May and August in 2014.

Pricing is important. Consider it a bit of a reflection on the obvious, but pricing your property appropriately is still considered one of the chief factors in getting it sold quickly. While we have seen price increases into the double digits over the past year, the first quarter of 2014 did not reflect these increases. Trulia.com suggests closely considering comps of other homes in the area and trusting the expertise of the listing agent. Also, keep recency in mind. For luxury homes, give recently sold comps more weight than older sales. The more recent a sale, the more accurate picture it paints of the current market. A hot market often brings fears of the dreaded bidding war. But fear not, statistics are showing that bidding wars are not as common as they were last year.

Another suggestion for grabbing a quick sale is to list your home earlier rather than later. Many homes will come on the market in late May and early June. Listing your home before the "rush" will give it a chance to shine as a new listing and get the attention and activity it deserves. Have your home ready to market before listing it the MLS and keep it in show condition so short notice requests will be easily accommodated.

Marketing a listing appropriately is key. A good team of agents will offer five star marketing services and will ensure your home is as attractive as possible to the buyers browsing the web for homes for sale. Riskin Associates employs a full time marketing staff. Having this manpower gives the Riskin Associates team the ability to create high-definition showcase videos, pitch listings to a network of public relations connections and design custom marketing strategies for each of their special listings.

Montecito, California: Niche Market Report

In recent weeks, the housing market has been at the forefront of the headlines, with major metropolitan markets booming. From London to New York to L.A. the big city areas are experiencing a fantastic upswing in transactions and foreign influences. Niche markets, such as Montecito and Santa Barbara are also experiencing a surge, however the specifics are decidedly unique.

One of the Montecito market's niche characteristics is that many homeowners own multiple residences and spend a portion of their time living or vacationing in their Montecito homes. Many buyers come from within the U.S., many East Coast and Mid-Westerners. Internationally, the U.K. has a firm presence and we do not experience the high influx of Asian, Russian or Canadian buyers that the larger markets are seeing.

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In Montecito, over 60% of homes are priced above $1M with the luxury price range starting around $7M. The under $2M price range is robust, many desireable properties receive multiple offers. The mid-range, $3M-7M is also steady with low inventory and a relatively high demand. The luxury market is somewhat slower. Inventory is saturated but we are not seeing the demand. The high-end market is experiencing a shortage in demand, inventory is steady however we are lacking in buyers. Prices are still down from 2007 but have held steady over the last 12 months.

In niche markets, "luxury" or "high-end" properties are often defined differently, with certain amenities demanding a premium. Montecito's unique location, between the foothills of the Santa Ynez Mountains and the Pacific Ocean, provides idyllic coastal views - which high-end buyers covet. Most luxury buyers want an ocean-view, turn-key property with a close-in location. Being within the prestigious Montecito Union School Distict and Montecito's "Golden Quadrangle" is another desirable factor of location, near to The Upper Village shops and restaurants and the world renouned San Ysidro Ranch resort. Picacho Lane, Park Lane and Riven Rock Road are considered first class streets.

Housing Market's Recovery Barometers reads: 61%

Trulia reports the housing market is 61% back to normal.

Online real estate giant Trulia's Housing Barometer charts the market improvement each month, tracking how quickly the housing market is moving "back to normal." An article posted on Forbes.com's real estate section discusses the three key pieces that paint this market picture for us:

• Construction starts: this represents the number of new homes being built throughout the country. Increased number of construction starts equates to housing availability and inventory for homebuyers. In May, starts were over 900,000, a healthy boost from April up 7%.
• Existing home sales: As inventory begins to expand, we begin to see a rise in sale of existing homes. Just over 5 million homes sold in May 2013, up 4% from April and a whopping 23% increase year over year. May was also the 4th straight month of inventory expansion.
• Delinquency + foreclosure rate: As we see the market begin to regain a sense of normalcy, we want to see this number drop. And in May, thats exactly what it did, to 9.13% from last years 11.08%. Fewer people are falling behind on their mortgages gently pushing the delinquency + foreclosure rate down. It is currently 57% back to normal.

By comparing these numbers to (1) their pre-recession "normal" numbers and (2) the numbers at their worst, we are able to see the market's recovery rate, exactly how close we are to a full recovery, and when we can expect that 100% recovery we are all anxiously awaiting. One year ago, the market was just 35% "back to normal" and this is the first time the barometer has crossed over into the 60th percentile.