The Santa Barbara Groups Real Estate Blog

Condo market showing signs of a rebound

The South Coast condo market hit the skids in late 2005 and just about fell off of a cliff shortly after. Once a thriving sector of our local market, there were years when condo appreciation seemed to out pace that of single family homes. Buyers faced with the choice of buying a 2 bed 1 bath home or a 3 bed 2 bath townhome for the same price often chose the latter, hence the hot condo market.

This all changed very quickly when the market cooled off. The new inventory of bank owned properties brought the starting single family home down to a price range where buyers started to choose homes over condos. As quick as condos went up during the hot market, they have given it all back and now buyers are taking notice.

Looking at statistics for June 2008 thru June 2009 tells the story. The number of sold units is up from just 21 in June 2008 to 43 in June 2009. That is an increase of 105%. One of the main driving forces behind these favorable statistics is the new Willow Creek Townhomes in Old Town Goleta. They finally got the price right and they are flying off the shelf.

Another indicator of a rebound in the South Coast condo market is the available inventory. In June of 2008 there were 356 units to choose from, compared to June of 2009 where we had 240 units available. This is a decrease of 33%. One way to measure the market is in terms of months supply. In June of 2008, we had 11.8 months supply, which indicates a gluttony of inventory and a buyers market. In contrast, June of 2009 we had a 4.4 months supply – a decrease of 63% – which is a much more stable market.

If you are thinking about pulling the trigger on a condo, now may be the time to strike. Rates are still at all time lows, government incentives are available and your timing could be perfect.