Edhat's ongoing compilation of profiles of people in our community with in-depth knowledge and expertise in their fields.

Stan Tabler
Real Estate
October, 2009

Stan Tabler is an agent with Coldwell Banker Santa Barbara. He's been in the real estate industry for over 29 years, mostly in Santa Barbara.

When you ask him what's happening with real estate, Tabler doesn't just give you platitudes or generalizations. He takes the time to make sense of available hard data. In response to our questions about how much value local homes have lost in the recent market downturn, he presented property samplings, organized by location, and computed the average price per square-foot in 2005 and 2009. (The price range was limited to homes under $900,000)

Here are the results for Santa Barbara, Goleta, and Carpinteria. In Santa Barbara, from 2005 to 2009, the average per square foot cost has gone from $830 to $517, a drop of 38 percent.

In Goleta, the average per square foot cost has gone from $666 in 2005, to $495 today, a decrease of 26 percent.

And in Carpinteria, the average per square foot cost has dropped form $611 in 2005, to $392 today, a decrease of 36 percent.

To illustrate these changes, Tabler gave us some examples of properties that have sold for much lower than their previous purchase prices. Here are some photos, with summaries of the various prices the homes have sold for over the last several years

1131 Bath Street, Santa Barbara. A 1925 Craftsman on a 3,600 square foot lot. 2 bedrooms, 2 baths. Close to downtown. Sold in 1998 for $350,000. After being fixed up, sold for $850,000 in 2004. In Sept. 2009, sold for $550,700 (bank owned).

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1228 Liberty Street, Santa Barbara. Lower Eastside 3 bedroom, 1 bath. Built in 1920. Lot size 4,791 square feet. Sold in 2005 for $730,000. Sold in July 2009 for $327,700 (bank owned, asking price was $299,900).

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1328 Portesuello, Santa Barbara. 2,094 square foot home with 4 bedrooms, 3 baths. 3-car garage. Built in 1970. Sold in 2006 for $1.389 million. Sold in April 2009 for $777,100 (bank owned, asking price was $784,000).

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Edhat: So, those all sound like pretty good deals. How long will this window-of-opportunity last?

Tabler told us the window might be closing. He expects there to be at least one more round of bank-released foreclosures coming on to the local market sometime in the next 90 days. But then, "as soon as that's done, prices are really going to stabilize and go up", he said. He expects that appraisers will begin to appraise properties at gradually higher values as the number of foreclosures and short sales decreases.

Public sales data from the week of Aug. 24-31 indicates that, of 23 home sales in the city of Santa Barbara, 7 were bank owned properties.

According to data from a private survey commissioned by local real estate professionals, the single family home median selling price on the South Coast is now just over $800,000, down from a peak of over $1.4 million in August 2007 and a low of $450,000 in August 1999. (See chart for more details.)

We also asked Stan to put some answers on paper for us. We've condensed his responses for your ease of reading, and also added a little numerical data to help provide context.

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Edhat: How much value have homes locally lost?

This depends on where the home is.

"Santa Barbara (City) hit a high median sales price in 2005 at around $1,172,666, and then stayed around that level for 2006 and 2007 and into 2008. I figure the median sales price is now $845,000, which is 27.9% off the highs, most of the decline occurring in the last 18 months", Tabler said.

According to MLS sales data, in August 2009, there were 38 sales in Santa Barbara, with an average sale price of $716,732.

Carpinteria hit a high median sales price in 2006 of $985,000. It is now $689,500 -- 30% off the high. (In August 2009, there were 19 sales in Carpinteria, with an average sale price of $763,289.)

Montecito hit a high median sales price in 2008 of $3,022,500. It is now $2,250,000 -- 25.6% off the high. (In August 2009 there were 14 sales in Montecito, with an average sale price of $5,653,078.)

Hope Ranch hit a high median sales price in 2007 of $3,756,471. It is now $2,350,000 -- 37.4% off the high. (In August, there were 2 sales in Hope Ranch, with an average sale price of $1,707,500.)

Goleta hit a high median sales price in 2007 of $879,000. It is now $707,500 -- 25.8% off the high. (In August 2009, there were 12 sales in Goleta, with an average sale price of $491,208.)

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Edhat: Have there been lots of good deals snatched up?

"Yes, there have been a lot of 'good deals,' usually for properties that sold for 50-60% off the highs of a few years ago and most, not all, of these have been foreclosures. I feel the best deals for buyers were made earlier this year when there were fewer active buyers. Now there seem to be plenty of buyers in the 'lower' range and multiple offers are not uncommon. I feel the best deals still available are in the higher ranges where sellers have to sell for one reason or another. Some of these houses and estates could not be replaced for what they may sell for."

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Edhat: Is this the time to buy?

Tabler says yes.

"Yes, it is a good time to buy if you are comfortable with the price and what your monthly payments will be. We have not had this combination of historically low interest rates and lower house values in a long time, maybe the late 1960's? If you are a buyer in the 'higher' end, it is a great time to buy."

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Edhat: Is this the time to sell?

Not if you don't have to. Tabler and other agents we talked to are telling people who don't absolutely have to put their homes on the market right now to hold off for awhile longer, until the market stabilizes further and prices start coming back up.

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Edhat: What direction are prices moving? Is the pace picking up?

"This depends on the where the home is, but mostly what price range it is now in. The market under $1,000,000 has warmed up and the market under $850,000
is hot. If a property is priced well in these price ranges, it will sell.

"I am aware of properties in these price ranges that have had 10-16 offers and sold for far more than the actual list price, which may have been set artificially low to attract attention.

"Santa Barbara (City) and Goleta markets seemed to have stabilized, at lower levels of listings available and more sales. I see these markets' values going sideways, with maybe a slight appreciation.

"The higher-end markets, especially in Montecito and Hope Ranch have been much quieter sales wise and inventory has built up in those areas. With plenty to choose from, buyers can be picky and seem more conservative in their choices. Even these markets have shown sale activity of late, but with prices far off the highs. While the pace has picked up a bit, ample inventory will prevent any appreciation anytime soon. I see this market still being in the buyer's market state and prices will continue to find their own level."

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Edhat: How about financing? How hard is it to get a loan?

"Yes, financing has become very difficult to obtain," Tabler confirmed.

"The sub-prime meltdown has affected the way loans are processed in a way that makes it harder for the self-employed (and there are many of us here in Santa Barbara) to qualify for a loan. Even if you have a large down payment, say 50% down, it can still be hard since we do not fit into the national mold of what a loan package should look like. If you are a salaried employee and have at least 20% down, you are a good candidate for a loan. The appraisal process has become more complicated. If you are self-employed or own your own small business and have 50% down, you may have a very hard time getting a loan. If you are a working student buying a place with your parents as cosigners, it has become increasingly hard to get a loan. The banks' rules seem to change all the time, even during the escrow period."

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Ed note: Our hope is that the next expert we interview will be a financial professional. If you are in the loan industry and would like to share your perspective, please email ed@edhat.com.

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