What happened in real estate in 2022? 2022 was the tale of two markets. It started out with extreme buyer demands, rapid price appreciations and low, we mean really low, inventory like we have not seen before.

The second half of 2022, the market changed in most regards; buyer demand dropped, prices started to reverse a little, but one thing stayed the same inventory has remained historically low.

A remarkable flip flop occurred. 2021 was a record year with the highest amount of sales that we experienced in a very long time. 2022 followed the record-breaking trend but in the opposite direction with the lowest amount of sales in a long time.

As the market changed trajectory in the middle of 2022, many buyers paused to better understand the direction the market was heading. In addition, the doubling of interest rates affected the buying power and budgets of many.

As 2022 came to a close the market seemed to be in process of re-calibrating. Prices began to adjust down a little and interest rates dropped from their high near 7% into the low 6% range. The initial shock seems to have worn off and the market came to accept the new season we find ourselves in.

So what is happening in 2023? After a very slow 4th quarter with only 259 total sales, activity seems to be picking up. The talk amongst fellow agents is the number of buyers entering back into the market is increasing.

Value has become a more important element in selling in 2023. Buyers want to see a concession off of the peak prices of 2022. In general and currently, if a home is priced 10-15% below the peak price, those homes are going under contract and selling fairly quickly. In the last couple weeks, there has even been a few properties that have seen 5+ offers in the price points between $1M to $5M.

2023 is starting off on a more encouraging note!

As always, real estate is dynamic and important to have a knowledgeable and caring advisor to help you through the process. If you are considering buying or selling, we would be honored to help. And we are always grateful for your recommendation!

THE HIGH & LOW

November 2022 Highest Sale  | 2781 Padaro Ln, Carpinteria |  Sold for $69,947,000

November 2022 Lowest Home Sale  | 17 S Voluntario St, Santa Barbara |  Sold for $810,000

The Statistics | 2022

• Total Sales: 1,443 in ’22 vs 2,216 in ’21 | DOWN 35%
• Total Home Sales: 1,015 in ’22 vs 1,541 in ’21 | DOWN 35%
• Total Condo Sales: 428 in ’22 vs 675 in ’21 | DOWN 37%
• Median Home Price: $2,104,000 in ’22 vs $1,875,000 in ’21 | UP 12%
• Median Condo Price: $958,000 in ’22 vs $840,000 in ’21 | UP 14%
• Sales Above $5M: 133 in ’22 vs 203 in ’21 | DOWN 35%

December 2022

• Total Sales: 76 in ’22 vs 138 in ’21 | DOWN 45%
• Pending Sales: 66 in ’22 vs 104 in ’21 | DOWN 42%
• Total Off-Market Sales: 12 Sales | 1 6%
• Total Cash Sales: 28 Sales | 37%
• Average 30-Year Fixed Rate Mortgage: 6.20% as of Jan. 27, ‘2