Nationwide, 2024 was a volatile year for real estate, driven by high interest rates, inflation, a presidential election, and economic uncertainty. These factors slowed home sales across much of the country. However, Santa Barbara County fared far better, with single-family home sales increasing 14% and condominium sales rising 3% compared to 2023.
Single-family homes and condominiums saw near identical trends across key metrics, with increases amongst: closed sales, days on market, average sales price, and median sales price.
Modest Price Growth Reflects Market Stability
Santa Barbara’s market showed healthier balance and stability compared to prior years. Buyers and sellers found a more even playing field, resulting in modest but meaningful price growth.
- Single-family homes: Average sales price up 7%, and median sales price up 2%.
- Condos: Average sales price up 1%, and median sales price up 7%.
This steadiness provided greater confidence for both buyers and sellers alike.
Inventory Growth Gave Buyers More Options and Time
For the first time in years, inventory improved significantly, offering buyers more choices and allowing them extra time to make informed decisions. This inventory increase contributed to the rise in home sales and extended days on market:
- Single-family homes: Days on market increased 37%.
- Condos: Days on market increased 29%.
- Calcagno & Hamilton’s listings sold in just 25 days on average—31% faster than the Santa Barbara South County average!
While inventory improved, Santa Barbara remains a high-demand market constrained by strict building regulations and a limited housing supply, keeping competition steady.
Ultra-Luxury Market Thrived in 2024
The ultra-luxury segment experienced exceptional growth in 2024, far outpacing the previous year:
- 7 homes sold for $30,000,000+ (vs. just 1 in 2023).
- 11 homes sold for $20,000,000+ (vs. 3 in 2023).
The highest sale was an oceanfront estate on 2781 Padaro Lane, a sprawling 10-acre compound, selling for $96,000,000 in August 2024. Early 2025 is already showing momentum, with one $30M+ sale and two $20M+ sales closed in the year’s first three weeks.
Interest Rates: A Mixed Bag
Interest rates were a key factor throughout 2024. Rates for a 30-year fixed mortgage peaked in the mid-7% range in April before trending downward to the low 6% range by September. The Fed’s 0.25% rate cut offered optimism, but recent data suggests rates could remain in the low 7% range for much of 2025.
2025 Outlook: Impact of LA Fires on Santa Barbara’s Market
First, we extend our deepest condolences to those affected by the Los Angeles fires. We are here to support displaced families with rental options, relocation resources, and connections for temporary housing. If you have a vacant property available for short- or long-term lease, please reach out and we can connect you with someone in need.
Immediate Effects on the Market:
- Surge in demand: Homes that sat on the market for months are now receiving multiple offers and backup offers.
- Increased listings: Some sellers, understanding the heightened demand, have decided to list their homes.
- Strained rental market: Already limited rental inventory became even tighter, with prices rising quickly.
- It’s important to note that not all of these market changes are directly attributable to buyers displaced by the Los Angeles fires. Many individuals who were already active in the market before these events have now intensified their efforts, likely in anticipation of a tighter buyer’s market and rising home prices.
Longer-Term Questions:
While the full impact remains uncertain, these events are creating noticeable shifts in both the sales and rental markets.
- Will displaced families consider Santa Barbara or Montecito for their next home?
- How will this affect the balance of buyers vs. renters?
- Could we see delayed impacts months from now as victims solidify their plans?
Insurance Challenges Persist
One consequence of the fires is heightened challenges in securing and retaining insurance. Many major carriers have paused issuing new policies in the Los Angeles area, and some high-end insurers have extended moratoriums to include Santa Barbara and Montecito. This is a discouraging development, especially as some carriers had recently begun re-entering the market. We expect insurers to return over time, but the fires will likely delay progress.
