Santa Barbara Real Estate: A Study in Metrics
In this post, I will dig into the data for days on market, median home prices, and price per square foot. These metrics combine to give us feedback about the current state of the market. I'll further subdivide this data into local areas and schools.
The first chart show average days on market for single family homes in the past 12 months. Days on market measures the number of days between a property being listed on the MLS and going into escrow with an accepted offer. I've broken that data down by school to give you an idea of those sub-markets.
An interesting piece of information from this chart is that, with very few exceptions, average days on market increases with price.
The y-axis shows average days on market. Schools are along the x-axis. In parenthesis, you'll find the median home price for that particular school's attendance area.
Average Days on Market | Single Family Homes | Past 12 Months
We can clearly see that luxury homes in the most sought-after schools in Montecito (Montecito Union and Cold Spring schools) take longer to sell than their lower-priced counterparts in the less-desirable Cleveland attendance area.
Homes outside of those top two attendance areas all sell within a similar 2-3 month window. It should be noted that, typically, selling within 3 months still indicates a seller's market.
This information is interesting on it's own, but let's dig deeper. What if we normalize the data by looking at how long a home will stay on the market for every $1,000,000 in asking price? An approach like this will help account for micro-market behaviors that are apparent in niche communities like Montecito.
Analyze the chart below by thinking, "For every $1,000,000 that I'm asking for my house, how many days should I expect it to sit on the market?". For example, a home in Mountain View attendance area that is priced at $1,000,000 (good luck finding one!) would be expected to sell after 49 days. Bump that asking price up to $1,500,000 and the data says that home will sell, on average, after 74 days (a 50% increase in list price begets a 50% increase in days on market).
Days on Market per $1,000,000
The third chart shows median home price per square foot (single family homes in the past 12 months). Price per square foot is one of the most commonly used metrics in real estate. It's a way of filtering out all the subjective aspects of pricing homes. Now, we can't simply apply a blanket price per square foot to all homes; we have to make adjustments for location, schools, amenities, condition, etc. But for now, let's look att he big picture.
You'll notice that Santa Barbara and Carpinteria are almost equal by this $/sqft metric. You might assume that Santa Barbara is more valuable (and it has been historically), but Carpinteria is making a strong push lately.
Carpinteria shares Santa Barbara's famous weather without subjecting residents to the same urban buzz. It's beaches are welcoming, it's restaurants are diverse, and it's character is relaxed. Many families have multi-generational roots in Carpinteria and it's easy to see why.
Goleta is last by this metric, which is a product of it's abundant tract homes. It simply does not have the time-tested prestige of other parts of town. However, with it's business-friendly atmosphere and push towards housing development, you can expect Goleta to gain ground in the coming years.
Montecito is predictably the leader of the pack, but even within it's expensive confines, there are big differences in value (we discussed Montecito Union/Cold Spring versus Cleveland earlier). A higher price per square foot becomes exponentially important when you consider most Montecito homes are usually much larger than those in other areas.
Median Price Per Square Foot | Single Family Homes | Past 12 Months
That's enough data for one day, right? Stay tuned for more deep dives like this in the future. The real estate market is a living and breathing animal that evolves constantly. Keeping an eye on the numbers is the only way to have your finger on the pulse!
Cheers! - Devin