May 2022 Market Update
Cryptocurrency is plummeting and Wall Street is on edge. The Federal Reserve is increasing interest rates. People are talking about a market shift and a forthcoming recession. In the midst of these accelerated feelings of uncertainty about our economy, not making any moves and waiting it out may feel like the logical, or at least safe, option. But even indecision is a decision. Is it the right one? Of course, we don’t have a blanket answer to this question for everyone, however, we do have some “food for thought” on the subject that we’d love to mull over with you.
The market is always shifting. Always. That is exactly why Zia Group tracks the market statistics week by week and month by month. Because of this, we have a very strong understanding of the market moment to moment. We also have the added advantage of claiming a significant portion of “market share”–in other words, because we represent more buyers and sellers in Santa Barbara than any other agent or team, we have a uniquely accurate pulse on the market. While we certainly cannot predict the future, this important information equips us to advise you as you contemplate what your needs, priorities, and goals are–and whether or not you want to make a move given current market forces.
So, what is happening right now in Santa Barbara’s market? As in past months, inventory remains very low: if nothing else goes on the market, all the inventory is predicted to sell in just 0.91 months. In other words, homes are still selling fast–in fact, the condo market in April, on average, sold homes in only 11 days! That is 10 days faster than April of 2021. The median sales price for single-family homes in Santa Barbara was $2,500,000–32% higher than April 2021 and, other than February, higher than we’ve seen this year. Experientially, homes are not receiving quite as many offers as we’ve come to expect–even if the outcome is still strong. Buyers have more leverage than they had 8 months ago. The recent rise in interest rates has impacted buyer’s buying power already, in some cases increasing monthly payments by 20%.
So, what is our conclusion? Again, there are no black-and-white answers. The market is shifting as it always is. Are the shifts we are seeing similar to when Covid-19 hit in 2020, causing a period of uncertainty that eventually settled and resolved back to an appreciating market? Or, is what we are experiencing now early warning signs that the market is going to adjust in the direction of providing buyers more and more leverage in the coming months? Ultimately, how the real estate market shifts, and what this will mean for you in 3 months, a year, or 10 years is unknown. But we can discuss with you what the market today means for you now. At Zia Group, we commit to always putting your goals and your real estate needs first. If now is the right time for you to sell or buy, we’re here to help you through that process. In the meantime, we’re here to advise you as you make intentional, informed choices along the way.
South Santa Barbara County Single Family Homes for May 2022
Including annual change | See definition of terms