The median age of a home buyer in today’s U.S. real estate market now stands at 43. In 2005 it was 39 and in 1985 it was 35. Santa Barbara’s real estate market has certainly coincided with this trend. Although the median age in Santa Barbara doesn’t differ tremendously from the rest of the U.S., its median home price and home owner occupancy percentage does. The year-to-date median home price in the Santa Barbara area currently stands at $1,155,000, putting financing into jumbo loan territory with extremely difficult qualifying standards, far harder than for conforming loans. This climate has turned over the home purchasing advantage to more mature buyers with large cash reserves. Seasoned investment oriented buyers have also been purchasing over half of Santa Barbara’s housing stock of late for purposes other than owner occupancy.
With this new age trend dominating the real estate markets we’ve seen a lower percentage of first-time home buyers. In a stand out Wall Street Journal article this month it’s stated that first-time home buyer percentages this year in the U.S. have dropped to the lowest level in three decades, adding that if home prices rise more it will become even harder for buyers to enter the market. Any increase in interest rates will also add to the challenges many first-time homebuyers face. These conditions do not fare well in economist’s eyes with regard to the long-term health of the U.S. real estate market.
I look forward to keeping you in tune with changes ahead for national and local Santa Barbara real estate. Although the current trends make purchasing difficult to some, I’ve been able to assist many young first-time buyers with successful home purchases in Santa Barbara this year. I appreciate the opportunity to be of assistance, as I was once a first-time home buyer in Santa Barbara myself.