1st Quarter 2015
2014 in Review
2014 was a relatively neutral year for real estate along the South Coast. Overall Sold Volume was nearly identical to 2013, with $2,329,975,020 in sales in 2014, compared to $2,332,661,103 in 2013. Inventory levels declined 5% from 2013 to 2,803 Active Listings. The Number Sold, 1,701, dropped in every community except Hope Ranch, falling 14% compared to 2013. Average Sale Price rose 16% to $1,369,768, and Median Sales Price climbed 10% to $880,000.
Nationwide, median home prices rose about 5%, as interest rates remained extremely attractive to home buyers. In California, median prices are still about 20% below the peak of $484,000, set in early 2007. Distressed sales, made up of short sales and foreclosures, continue to decline as market conditions improve. The stock market remains extremely robust, hitting a high of over 18,000 to end 2014.
4th Quarter 2014
Locally, after a strong first, second, and third quarter, 2014 ended on a downward trend. The fourth quarter of 2014 finished well behind the same period in 2013. The Number Sold fell 8% to 400. After climbing in every quarter of the year, Median Sale Price fell 3% and Average Sale Price dropped 10%. Total Sold Volume declined 17% to $469,272,735.
Lack of inventory continues to be a problem for the Montecito market. Active Listings continued to decline, falling 12% to 501. Consistent with the lack of inventory, the Number Sold dropped 12% to 228. Sold Volume was almost unchanged in 2014 at $770,358,381, due to a 13% increase in Average Sale Price to $3,378,764. Median Sale Price also rose a solid 18% to $2,657,500.
There are currently only two Active Listings in Birnam Wood. Despite low inventory levels, 2014 was a strong year for sales, with sixteen Closed Sales: 1920 Boundary Drive for $1,950,000; 2000 Sandy Place for $2,060,000; 526 Las Fuentes Drive for $2,700,000; 527 Crocker Sperry Drive for $2,700,000; 490 East Gate Lane for $2,810,000; 564 Crocker Sperry Drive for $2,934,000; 2076 China Flat for $2,975,000; 2118 Birnam Wood Drive for $3,075,000; 1930 Lemon Ranch Road for $3,150,000; 525 Las Fuentes Drive for $3,475,000; 1997 Lemon Ranch Road for $4,000,000; 489 Crocker Sperry Drive for $4,185,000; 529 Las Fuentes Drive for $4,300,000; 2085 Stratford Place for $4,454,000; 2117 Forge Road for $4,750,000; and 514 Las Fuentes for $6,200,000.
Hope Ranch was the strongest community along the South Coast in 2014. Inventory levels rose a healthy 8%, helping the Number Sold increase 15% to 38 properties. Average Sale Price climbed 8% to $2,799,157. Median Sale Price jumped an impressive 21% to $2,525,000. Sold Volume soared 25% to $106,368,000.
Predictions for 2015
With interest rates low, and the economy doing well, 2015 should be a good year for real estate, both locally and nationwide. The chief economist for the National Association of Realtors expects median home prices to rise by 4% in 2015. Economists at lending giant Freddie Mac are predicting a 3% increase. Interest rates are expected to rise slowly throughout the year. Low inventory levels, and a strong economy should continue to benefit Sellers of luxury properties. Rising interest rates will hamper activity in the lower price ranges.
Director, Estates Division
Berkshire Hathaway HomeServices