Santa Barbara Luxury Real Estate on Pace to Set Another Record
The Santa Barbara luxury real estate market continues its red hot streak. The luxury real estate market in Santa Barbara is defined as estate property that is priced at $10 million and above. The luxury real estate market in Santa Barbara is on pace, once again, to set another record. In 2006, the luxury real estate market generated $219.2 million in closed sales according to the Santa Barbara Multiple Listing Service (MLS). In 2007, through mid May, the luxury real estate market has generated nearly $129 million in closed sales. Less than half way through the year, we are pacing ahead of total sales in 2006.
(PRWEB) May 24, 2007 -- The Santa Barbara luxury real estate market continues its red hot streak. The luxury real estate market in Santa Barbara is defined as estate property that is priced at $10 million and above. The luxury real estate market in Santa Barbara is on pace, once again, to set another record.
In 2006, the luxury real estate market generated $219.2 million in closed sales according to the Santa Barbara Multiple Listing Service (MLS). In 2007, through mid May, the luxury real estate market has generated nearly $129 million in closed sales. Less than half way through the year, we are pacing ahead of total sales in 2006.
Additionally, the Santa Barbara luxury real estate market is pacing ahead of last year on a per transaction basis. In 2006, there were 14 luxury sales that comprised the $219.2 million, resulting in an average of $15.6 million per sale. So far, in 2007, there have been 6 sales comprising the nearly $129 million, resulting in a $21.5 million per sale. This is a whopping 38% increase!
Going back to the year 2000, the luxury real estate market in Santa Barbara has exceeded the total revenue of the prior year in closed sales. There are several reasons for this trend. The first reason is that Santa Barbara strongly favors anti-growth, which makes it difficult to construct new homes. Santa Barbara consistently has very few homes for sale to select from. This is because developing new homes is extremely difficult. There is very little remaining land available that is suitable for luxury real estate. Due to the lack of available land, many purchase existing homes that they hope to tear down to build a luxury estate property. The cost to purchase an existing home is typically higher than it would be to purchase raw land. Once the purchase is made, a lengthy approval process ensues to get the permits to build. There are many restrictions and hurdles to overcome to receive permits. It is not unusual to be in the approval process for anywhere from 1 year to up to 5 years before receiving permits to begin construction. Once an approval is finally received, the construction process begins. It is not unusual for the construction to take upwards of of 2 years to complete. There are very few luxury estate builders in Santa Barbara who typically charge a premium cost per square foot to build. Considering the inital higher cost to acquire a desirable property, the carrying costs of holding the property through a lengthy approval process, and then a costly build out, the owner of the estate often either decides not to sell, or if they do decide to sell must obtain a significant premium in order to recoup the costs of the build out.
Santa Barbara offers one of the best quality of life environments in the world. Santa Barbara is a small oceanfront resort community. Santa Barbara has beautiful weather all year long, it has a clean environment with pristine beaches, and good air quality. Those fortunate enough to be able to live in Santa Barbara are very appreciative of the lifestyle that it affords.
For more statistical analysis, or to discuss real estate, please contact Wendy Elizabeth Gragg, Distinctive Real Esatate 805.565.0246 or visit our website at www.DistinctiveRealEstateOnline.com.
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