HOW WILL PREDICTED 2024 REAL ESTATE TRENDS AFFECT THE SANTA BARBARA MARKET?

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As we approach the new year, Santa Barbara homeowners and potential buyers are met with promising news from the recently released "2024 California Housing Market Forecast" by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.). In a climate of slower economic growth and cooling inflation, the forecast indicates a shift toward a more favorable market environment, creating opportunities for both buyers and sellers in our picturesque region.

A birds eye view of a massive Montecito Estate framed by incredible landscaping, a 124 ft. pool, and private polo grounds

Santa Barbara Shines: Leading the Way in California's Housing Market Surge

The recent C.A.R. housing market update unveils significant gains in home prices across the state's 58 counties. In this real estate landscape, Santa Barbara stands out as a critical player in the flourishing market dynamics. Examining the period from August 2022 to August 2023, notable increases emerged in San Diego, Santa Clara, and, notably, Santa Barbara. In the heart of Silicon Valley, Santa Clara County witnessed a 12.3% rise in median sale prices. Simultaneously, San Diego County boasted a robust 12.8% annual increase. Surpassing them both, Santa Barbara showcased its prominence with an impressive year-over-year price gain of 16.4%.

The front courtyard and facade of a large Spanish Colonial Revival Montecito home originally designed by legendary architect George Washington Smith

Market Momentum and Projections

Persistent housing shortages and a competitive market have been contributing factors to the upward pressure on home prices, a trend that is expected to continue into 2024. The baseline scenario outlined in the forecast anticipates a significant uptick in existing single-family home sales, projecting a 22.9 percent increase in 2024 to reach 327,100 units. This follows a projected decrease of 22.2 percent in 2023 compared to the pace set in 2022. The California median home price is expected to rise by 6.2 percent in 2024, rebounding from a dip in 2023.

The back yard of a Cape Code Style Estate for sale in Montecito, with a sprawling lawn and freeform pool in the foreground

Optimism for Buyers and Sellers

According to experts, in 2024 the California housing market is poised for improvement, benefiting both buyers and sellers. The anticipated decline in mortgage interest rates signals lower borrowing costs, coinciding with a surge in available homes for sale. This dual effect serves as a catalyst, motivating buyers and sellers to participate and reenter the market actively.

First-time buyers who faced challenges in the highly competitive market in recent years are expected to pursue their American dream in 2024. Repeat buyers are also poised to return to the market as mortgage rates begin to trend down.

The courtyard pool of a mid-century modern estate, with the lapis-colored pool embraced by wings of the home with walls of glass

Economic Landscape and Mortgage Trends

C.A.R.'s forecast predicts a modest U.S. gross domestic product growth of 0.7 percent in 2024. Despite a slight increase in the state's unemployment rate to 5.0 percent in 2024, the overall economic environment remains stable. Meantime, inflation is expected to decline gradually, impacting mortgage rates. The average 30-year fixed mortgage interest rate is projected to decline from 6.7 percent in 2023 to 6.0 percent in 2024. This decrease, while still above pre-pandemic levels, provides buyers with increased financial flexibility to consider homes at higher prices.

An impressiveMediterranean-style Ojai estate with the breathtaking Topatopa Mountains in the background and a pool and spa in the foreground.

Supply and Demand Dynamics

Housing supply is anticipated to remain below the norm in 2024, even with a projected increase in active listings of 10 to 20 percent. Market conditions and improvements in the lending environment contribute to this dynamic.

C.A.R. Senior Vice President and Chief Economist Jordan Levine noted, "Buyers will have more financial flexibility to purchase homes at higher prices, which could generate increased housing demand and result in more upward pressure on home prices."

The front of a Contemporary home, embraced by mature trees, and with beautiful blue sky and pink clouds in the background.

Buy Now or Later?

In the intricate dance of real estate decisions, prospective homebuyers often find themselves at a crossroads, contemplating when to take the plunge into California's housing market. The pivotal question arises: Is it wiser to seize the moment or exercise patience in the face of market uncertainties?

Buying a home, like any of those pictured in this blog post, is deeply personal and contingent on emotional readiness and financial preparedness. Many factors demand consideration, aligning with a person’s current financial situation and long-term plans. However, from a pragmatic standpoint, one could argue that the advantages of purchasing sooner rather than later outweigh the risks. As highlighted in the C.A.R. report, the statewide median sale price for existing single-family homes has witnessed a 3% increase over the past year. If this trajectory persists, waiting might translate into a 3% hike in housing costs.

As we look ahead to 2024, my goal is to provide both buyers and sellers with the information they need to make educated decisions when it comes to the real estate landscape. The CALIFORNIA ASSOCIATION OF REALTORS® is just one of the valuable assets I continue to monitor. It has been leading the way in real estate news and information for over 110 years, dedicated to advancing professionalism in the industry. Stay informed and empowered as we navigate our beautiful coastal community's evolving trends and opportunities. For more information, visit www.car.org.

I sincerely hope the Santa Barbara Real Estate Predictions for 2024 outlined in CAR’s "California Housing Market Forecast" encourage you to explore the wealth of available properties tailored to your unique preferences on my comprehensive website. (Some of those outstanding properties is shown in the photos in this post.)

Whether you’re considering a picturesque home in Santa Barbara or exploring investment opportunities here, the evolving real estate landscape provides a canvas to make your dreams come true. When you're ready to turn your vision into reality, call me at (805) 886-9378 or email me at Cristal@montecito-estate.com. Let's engage in a conversation about your aspirations and navigate the dynamic real estate market together.

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Client Reviews

“It was an emotional experience selling our mother’s home in Montecito that we all loved so much but Cristal made the process easier on our whole family by guiding us through the transaction every step of the way. She knows the market so well and everything she recommended was on point including the asking price, painting, and staging the home, which looked beautiful and helped the buyer envision her new home. We sold it the first day it hit the market with an offer above asking! Cristal did an incredible job communicating with us and the buyer to ensure that the transaction would run smoothly. We highly recommend using Cristal, she was a pleasure to work with! ”

- J & A

“Cristal is a pleasure to work with! Her knowledge of the local real estate market coupled with her amazing listening skills resulted in her showing us an array of homes that were all excellent choices. Her low-pressure patient attitude made us feel extremely comfortable with the whole process. I cannot recommend her highly enough.”

- M.F.

“Cristal Clarke is #1 in her field - and you don't become #1 by luck. Cristal works harder, and longer, and with more charm and patience than any real estate agent I have ever worked with in the past; her calendar has no weekend, her days have no clocks, her only concern is selling your property as soon as possible and for the best price on the market. Am I a fan? You bet!”

- P.B.

“We have used Cristal now several times and cannot express how grateful we are for her expertise, dedication, and unwavering support throughout the entire home-buying process. Cristal is knowledgeable, patient and attentive. Her attention to detail is remarkable, and she consistently went above and beyond to provide us with all the information and resources we needed to make informed decisions. Cristal is a skillful negotiator and advocate. She can navigate complex negotiations with professionalism and grace and felt like a true partner to us in the home-buying process. Cristal has a genuine passion for real estate and a deep commitment to her clients' satisfaction. I cannot speak highly enough of Cristal and her exceptional service. She is a true expert in her field and her dedication to excellence, combined with unwavering support is the reason we choose to work with her for all our real estate buying needs.”

- T.C.

“Cristal is a top-notch realtor who sold my home before it ever went on the market. I had two competing offers that enabled me to get top dollar for my home. Not only is Cristal superb but her team is extraordinary. I cannot say enough about Cristal and her team. They are simply phenomenal, the consummate professionals, who took care of every possible detail, making the sale and transition period, smooth from our end. They are also lovely, caring people, who knew all the right professionals, to get the job done. Thank you, everyone!”

- D.R.

“I could list lots of cool adjectives to describe Cristal. All good by the way. But, that is not why I or anyone should hire Cristal. My reason for hiring her, which proved to be correct, is very simple. She got the job done. And, she does it time and time again and with zero issues. And, that is why she is one of the top agents in the country. End of subject. ”

- M.A.

“Working with Cristal was a complete pleasure. Cristal was extremely patient with us as we evaluated nearly 2 dozen homes over a span of 2 years. Her knowledge of the market is unmatched. Cristal provided us with exceptional counsel as we evaluated opportunities and negotiated pricing. The closing process was handled thoroughly and efficiently. We could not be happier with our purchase and even more happy to now call Cristal our friend.”

- D.K.

“Cristal Clarke has conducted numerous real estate transactions for me beginning 13 years ago with the purchase of a Lemon Ranch. She has handled both large and small purchases and sales with equal dedication. As a negotiator, you can’t find anyone better. Her transactions are always conducted in the most appropriate and professional manner. Cristal has considerable knowledge of the Santa Barbara market.”

- S.N. Decker Ph.D.

“Living in Europe, we were to say the least, unaccustomed to the nuances of Real Estate acquisition in California and Cristal steered us through the process with absolute professionalism and personal attention to detail at every turn. Her in-depth knowledge of the market place combined with enthusiasm and drive was the only reason we secured the property of our dreams and will be forever grateful. If you are looking for personal discrete and private representation of the highest quality we suggest you look no further than Cristal Clarke.”

- Johan and Paula van den Berg

“Cristal is very straightforward, cheerful, helpful, professional and trustworthy….we felt very lucky to work with her.”

- John and Lacey Williams

“After considering our many choices, we are grateful it was Cristal Clarke of Sotheby’s International who represented the sale of our Montecito cottage. We are familiar with Cristal’s reputation of hard work and dedication to clients, but it was her attention to detail that made our experience so positive. She offered suggestions for staging the property, worked in harmony with potential buyers and was even able to secure back up offers. The sale of our cottage was completed much sooner than we expected, due in great part to Cristal’s professional skills and support. We highly recommend Cristal as a first choice for anyone needing representation with real estate.”

- Michael & Nancy Lee

“Our experience in working with Cristal Clarke resulted in the successful and discrete acquisition of a property which was not yet on the open market. Her knowledge of the Montecito/Santa Barbara area and vast expertise blended with her passion for real estate and architecture, provided us with the very highest level of professionalism and personalized services. Cristal exhibited a rare combination of excellent communications, attention to detail, creativity and patience.”

- Richard and Catherine Frinier

“Cristal really breaks the mold. She knows every nook and cranny of this real estate market, understands value, and follows up on everything, all the time. She was incredibly patient with our two year quest to find the perfect house. Every house hunting trip from across the country was well planned, and our time was never wasted. On top of her professionalism and expertise, she is delightful to spend time with. We are thrilled with the home we purchased, and grateful to Cristal for so wisely advising us through this process, right through to the close and beyond.”

- Laurie Siegel

“We met Cristal first in the course of renting a winter home (for three years), then buying a house using her as our agent. She was amazingly good at listening to our wants and showing us homes that fit our needs. Her mastery of the paperwork was perfect. Most importantly, there was never a situation where we doubted her straightforwardness or integrity. If we do another real estate transaction in Montecito (which I doubt, we’re happy with what we purchased), without question we’d use Cristal again.”

- Ken Saffir

“Susan and I just want to thank you for your efforts in the sale of our home. You are really quite amazing. Your competence, persistence, optimism and humor made the entire process effortless. Every problem that arose, you somehow fixed; any obstacle, you overcame. We have bought and sold many homes. It has never been such a painless and enjoyable process!”

- Michael & Susan Marquart

“A little something about “our” realtor, Cristal Clarke. My wife and I came to Santa Barbara about fifteen years ago looking for a seasonal home from which to enjoy the weather and amenities of the central coast. Being in the real estate business myself I was familiar with agents and brokers so entered the market with open eyes. We “flipped” a few houses in the early years, dealing with various agents and finally ended up in Montecito. That’s when good fortune put us together with Cristal. To say we were impressed is to put it mildly. Cristal really knows the market. She is familiar with the area, its history and trends. When we have questions about a particular property she either has the answers immediately or gets back to us by phone or email. There is no waiting or wondering with Cristal. She is an agent who is “on top of it.” Her recommendations as to price points, contractors, inspectors and title agents have proven to be exceptional, showing great insight and the highest professional standards. We consider ourselves exceedingly fortunate to say that Cristal Clarke is our realtor and would recommend her services to any serious buyer or seller.”

- Rob & Judi Kelch