Sellers are Golden
Stability in the Golden State is leaving California’s sellers in the driver’s seat.By Alexa Rozzi
Along the coast of California, buyers know what they want and are ready to move, putting sellers at an advantage for the first time in seven years. Though markets continue to fluctuate because of uncertain interest rates, agents project stabilization for 2014.
According to Nancee Swensson of HÔM Sotheby’s International Realty, prices in Laguna Beach increased 22 percent from October 2012 to October 2013.
“There was a lot of pent-up need. Buyers need to move and they can only wait so long,” she says.
In a luxury price range of $610,000 to $8 million, prices average between $2.5 million and $3.5 million. Swensson says buyers have become more comfortable making bigger ticket purchases of $3 million. Real estate as an investment is driving this trend, according to the agent.
“For the first time since 2006, people are seeing real estate as a solid, dependable asset to hold their money, one they have more control over,” she says. “Real estate is back as a safe-haven investment.”
Travel north of L.A. to Malibu, and you’ll find 26 miles of oceanfront extending up into the hills, offering beachfront, beach-view and bluff properties.
“We are seeing higher prices for listings offering private, deeded beach access, but there are still highly desirable off-the-beach, estate-like properties as well,” says Marcus Beck of Berkshire Hathaway HomeServices California Properties.
Beck says the area draws younger families purchasing homes between $2 million and $3 million on the beach, and $2 million to $5 million off the beach, with buyers seeking homes that are move-in ready.
“The extremely wealthy are seeking the instant gratification of a completely finished home,” says Beck. “Selling prices increase for a home in turn-key condition.”
San Luis Obispo
In San Luis Obispo, low interest rates catalyzed a spike in home sales through May 2013, but the market cooled and remained consistent through July, according to Kelly Vandenheuvel of Patterson Realty.
Vandenheuvel says inventory is low and being rapidly absorbed, but an increase in interest rates has slowed movement of luxury homes. Similar to Malibu buyers, San Luis Obispo buyers are also seeking move-in ready homes.
The luxury market ranges in price from $1.5 million to $3 million. In the city of San Luis Obispo, private, gated community homes average about $2.4 million, but as the wine industry of San Luis Obispo rapidly develops, buyers are coming to the area seeking wine country homes.
In 2013, low inventory in the Santa Barbara/Montecito area caused the market to slow, with just 6 ocean-view homes available in Montecito, according to Harry Kolb of Sotheby’s International Realty.
“Buyers come to the area to purchase foothill estate properties with ocean views, but with a location a mile or so from the water,” he says. “Right now, there is little urgency to sell or buy in the area.”
Randy Solakian of Coldwell Banker Previews International agrees and says there has been a steady stabilization in the market beginning in early 2012.
“Last year, an abundance of listings that weren’t sold during the crash years moved off the market, often at dramatically reduced prices. This fueled increased sales. This year, because of those sales, inventory decreased and the pace of sales stabilized.”