Montecito is an affluent seaside town offering its residents access to high-performing schools, lavish country clubs, and world-class resorts. Despite cooling trends across Santa Barbara County, its range of secluded estates and luxurious properties has kept demand and prices high in this area. The end of quarter one marks an increase in listings and a decrease in home sales, while other factors may suggest further cooling to come. Whether a buyer or seller working with a Montecito realtor, here’s what to know about the current market.
Montecito housing market
Review the statistics below for a quick view of the town’s current trends. Then, read on for an explanation of what these figures mean for buyers and sellers.
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Single-family residence home sales have decreased by around 60% since last year
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The median price for Montecito, CA, real estate is $8.75 million
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The median price has increased by 26.3% compared to last year
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Active listings have increased by 17.4% since last year
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Homes spend a median of 44 days on the market
Montecito is experiencing a mix of market trends that shows persisting buyer demand within a cooling market. The number of home sales has decreased considerably compared to last year, caused by less housing inventory. Although inventory is on the rise, an abundance of buyers in the market is causing inventory to be absorbed quickly.
Low inventory levels have also put pressure on the median price for homes in the area, increasing by 26.3%. Buyers searching the market still have to act quickly since listings spend a median of 44 days on the market. Even so, sellers should consider cooling trends when pricing their Montecito, CA, real estate, as the sales-to-list price percentage is 93.7%.
Santa Barbara South County
With your agent, you can review market data from Santa Barbara South County to further contextualize your home search. As distinguished from North County, Santa Barbara South County hugs the Pacific Coast, extending from Gaviota at its westernmost edge to Carpinteria in the east.
Santa Barbara South County contains excellent parks of the beach or lookout variety. It’s also home to several different cities. Consider the following data, courtesy of the Santa Barbara Association of Realtors:
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Carpinteria: 33 active listings, 10 over $10 million
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Goleta: 41 active listings, 18 between $1 million and $3 million
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Montecito: 69 active listings, 23 over $10 million
The above cities are microcosms of Santa Barbara South County, with high demand, limited inventories, and higher asking prices than commonly found in Santa Barbara North County. In contrast to Santa Barbara South County, cities like Buellton, Lompoc, and Solvang are more quaint and rural.
Unsurprisingly, Santa Barbara City is the nexus of Santa Barbara South County. The city spans 42 square miles, including over seven miles of beach. Most high-end properties in Santa Barbara have fewer than 3,000 square feet — to homebuyers, their luxury value stems from the beautiful climate, beach lifestyle, and fantastic views.
As of May 2023, Calcagno & Hamilton show over 200 available properties within Santa Barbara. Those looking to start fresh should look into the plots of land primarily concentrated in the hills overlooking the beach. Meanwhile, Santa Barbara city comprises about 100 strictly residential properties. Here’s how they break down by listing price:
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14 listed at $5 million or above
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41 listed at $2 million or above
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56 listed at $1.5 million or above
About half of the actively listed properties have at least three bedrooms and three bathrooms. As a buyer, the expert agents at Calcagno & Hamilton Group are an invaluable resource when narrowing down your options. They can piece together your desired amenities and isolate a handful of available homes that meet or exceed your expectations.
Factors impacting Q1
Despite approximately one-third of deals being all-cash, a significant factor impacting Montecito’s cooling market trends is the rising price of mortgages. Montecito has a housing affordability of 11%. This is lower than California’s 17% and the U.S.’s 38%. Rising interest rates and rising home prices make buying in this town attainable to wealthier homeowners. This is reflected in the median household income in the area, which is $193,423. Montecito’s median income is double the U.S. average.
Buyers should consider the cost of living when moving to Montecito. Annual living costs average over $2,000 more compared to California and over $9,000 more than the country. One of the main components of living costs is the price of housing, although a higher median household income balances this out.
Buyer and seller tips for Q1
Buyers and sellers may struggle to navigate local market trends when planning their home sale or purchase. Use these tips for a more straightforward home transaction.
Get pre-approved
The best thing buyers can do before starting a home search is to get pre-approved for a mortgage. Having financial backing planned for before a search helps buyers understand how much home they can afford. Many sellers won’t take an offer seriously without proof of funds, like a pre-approval letter.
Price accurately
Sellers listing their homes during a cooling market should always price accurately. An overpriced home can cause a listing to linger. This makes it less appealing to buyers in the area and may require sellers to reduce their listing price. It’s also harder for qualified buyers to find an overpriced listing if they use price filters on a listing platform.
Partner with a Montecito Realtor
Buyers and sellers should always partner with a local agent for the best chances of success. For buyers, an agent searches for listings that align with their goals, organizes home showings, and helps during negotiations. Sellers can count on agents to help prepare their property, market a listing, and provide additional resources.
Ready to invest in Montecito?
The first quarter of Montecito is marked by high median prices and slowing market conditions. These conditions are reflected across the county, indicating larger cooling trends in the area. Montecito investors should prepare for a tight inventory and consider other obstacles like high mortgage rates and an expensive cost of living. When you’re ready to start a home search or sale in the area, contact one of the experts at Calcagno & Hamilton for expert guidance.
