The overriding dynamic of the Santa Barbara Riviera real estate market throughout the last three months of 2021 was that the buyer demand simply overwhelmed the supply of available homes for sale. And, as you might guess, this led to another turbo-charged increase in the median price to an incredible all time high of $2,900,000!
My last report in July explained that there were some signs of stabilization in the market as more homes became available for sale and prices did not increase beyond the level they had reached in the first quarter. However, it is now apparent that an extreme seller’s market has come back to life as the number of sales declined and the median price jumped another 18% in the last three months. This was not only driven by a lack of inventory but also a return of competition amongst buyers as evidenced by a significant number of homes getting bid up in price by an average of 15%. Overall, in the first three quarters of 2021 the median price in the Riviera/El Cielito/Eucalyptus Hill neighborhood has surged 35%!
At this point it is difficult to predict how the Santa Barbara Riviera real estate market will perform throughout the end of the year and into the beginning of 2022. It is unlikely that the current low inventory dynamic will change – in fact, it may even become more pronounced as we head into the holidays. On the demand side of the equation there are a number of factors that could alter the trajectory of the soaring seller’s market. We are already beginning to see a few signs of these such as an increase in interest rates, a lack of buyer demand for overpriced listings and a slight decline in overall consumer confidence. With this in mind, if you are on the fence about selling your home sooner rather than later, I would recommend taking advantage of the current market that still strongly favors sellers.