Santa Barbara South Coast Midyear Update 2019
Happy Summer to all of you, although it sure has been a gloomy one so far in terms of weather. Not so gloomy is the current forecast for Real Estate in SB and CA right now. We just attended the Economic Forecast put on by local statistician Mark Schneipp and the focus was on “when is the next recession?” It seems that we might be overdo due to the fact the this has been the longest expansion period since the Great Recession in 100 years. It’s been over 10 years since the GR. In fact more people are googling “recession” that ever before, especially at the end of 2018. We think that was due to the uptick in interest rates. Speaking of interest rates, they are super low again and we don’t expect them to go up soon. Many people who bought in 2018 are refinancing because it’s about 1% less now.
Existing home sales are up due to these interest rate cuts but still struggling a bit. The inventory is the highest in CA since 2011. However, there is HUGE growth in CA which is being driven by new development. It’s everywhere! Just in Butte County alone (Paradise Fire area) they are building 14,000 new homes and business. Commercial and apartment building is at an all time high in LA since the 20’s. If you are a contractor or a techy you are in serious demand! The job market is epic and we are not seeing a slowdown. Unemployment is the lowest since the 60’s and for SB it’s the lowest in 20 years! Who is a buying a home here? 70% are local and 30% from outside the area. 78% are buying for their primary home, 10% are investors and the rest are secondary home buyers.
In summary, the housing market is not going to collapse, labor markets remain tight, another year of full expansion, expect a volatile stock market, more traffic, visitor crowds and high home prices which may make you wish for a recession. According to Mark the next one is years away. Call us to discuss how this latest news might affect your real estate portfolio.
|HOMES & PUDS|
|Median Sales Price||$1,290,000||$1,257,500||$1,250,000||+2.6%|
|Median Sales Price||$653,450||$644,000||$599,000||+1.5%|
DRE License 00552664
DRE License 01488548