South Santa Barbara County Market Update

Welcome to Santa Barbara — How’s the Housing Market Doing?

Happy fall! As school is back in session and cooler weather approaches, Santa Barbara’s housing market shows moderate signs of shifting in unique ways. Yes, thankfully, we have seen more homes coming on the market, and days on market are stretching slightly, and also, home values remain steady. With interest rates edging lower, many are asking: Will demand rise? The answer is almost certainly yes. For those selling, buying, or remodeling, these conditions present opportunities worth watching.

Santa Barbara: A Place We Love to Call Home

I’m grateful and privileged to live, work, and raise my daughter here — a third generation born at Cottage. Santa Barbara has long been known for its unmatched lifestyle and high housing costs. Families like mine who grew up here often want to stay, while newcomers are drawn by our area’s natural beauty and community spirit. This enduring appeal drives demand across the South Coast, where more residential properties are coming on the market and mortgage rates are edging lower — combined with the best weather in the country and an exceptional quality of life — all encouraging continued interest in Santa Barbara homes. Realtors® throughout our region share a common purpose: helping families navigate complex real estate decisions so they can put down roots, contribute to the community, and feel at home.

The Stats: South Santa Barbara County MLS – Single Family Homes (statistics from August 2025)

• Sales:  84 homes sold in August
• Median Sold Price:  $2,264,000; $2,380,000 year-to-date
• Days on Market:  46 this August vs. 38 last year. Homes are taking a few days longer to sell, giving buyers more time to negotiate, especially on listings active for more than 30 days.
• Inventory:  914 active listings through August, up 13 percent year-over-year
• Takeaway:  Prices in Santa Barbara neighborhoods remain strong year-over-year despite more supply and longer selling times. Compared with the pandemic period, when inventory was extremely tight, today’s market offers buyers more choices while still supporting steady home values overall.

Market Snapshots by City

Santa Barbara

• 40 homes sold
• Median Sold Price:  $2,274,500
• Takeaway:  Inventory is increasing, but still below pre-COVID levels. Activity is more stable than recent years.

Goleta

• 23 homes sold
• Median Sold Price:  $1,650,000
• Days on Market:  Lower than countywide average; affordable, move-in-ready homes are in demand and sell quickly.
• Takeaway:  Still a strong seller’s market with competitive demand.

Montecito (93108)

• 12 homes sold
• Median Sold Price: $6,075,000
• Days on Market:  Longer, consistent with the luxury tier
• Takeaway:  The pace remains steady and healthy. Some relocations tied to the Los Angeles fires, although it’s unclear how many will translate into purchases versus rentals.

Carpinteria/Summerland

• Six homes sold
• Median Sold Price:  $2,285,500
• Takeaway:  Smaller sample size, but trends align with countywide patterns.

Hope Ranch

• Three homes sold
• Median Sold Price:  $6,000,000

Santa Ynez Valley

• Nine homes sold
• Median Sold Price:  $3,050,000
• Takeaway:  Typically fewer homes at higher luxury price points, reflecting our classic Santa Barbara oceanfront, ranch, and wine country properties.

Condos

• 22 closed escrows in South S.B. County last month at a median sold price of $884,950.
• 853 total sold year-to-date at a $1,900,000 median.
• Takeaway:  More condos are available, and more are currently in escrow. This reflects both an entry-level option for many buyers and an opportunity for sellers to use their equity for a lifestyle change.

What About Interest Rates?

As widely predicted, the Federal Reserve cut the federal funds rate by 0.25 percent in mid-September — its first cut of 2025. Mortgage rates, however, didn’t drop dramatically since markets had already priced in the move.

Today’s 30-year fixed jumbo mortgage rate (for homes more than $913,100 in Santa Barbara County) averages about 6.4-6.8 percent, compared with the 7-8 percent range seen earlier this year and last year.

Homes priced lower than $913,100 qualify for conforming loans, generally at slightly lower interest rates — around 6.3 percent today. All loans depend on credit score, income, debt, and other borrower factors.

For buyers, lower rates improve purchasing power and encourage more activity. For sellers, they reduce the gap between today’s financing environment and the ultra-low mortgages of 2020-21, which may prompt homeowners who have been waiting to make their move. Refinancing is also a realistic option for some who bought at peak rates in 2022-23, though strong credit and financial stability remain key to securing favorable terms.

Bottom line: Santa Barbara could see more buyers and more sellers this fall — both supply and demand rising together.

Prop. 19 and Downsizing Options for Seniors

One reason inventory remains limited is that many longtime owners are “locked into” very low mortgage rates. For those considering a move, California’s Proposition 19 (2021) offers important benefits:

• Tax Savings:  Transfer your property tax basis to a new home anywhere in California, avoiding a major increase.
• Eligibility:  Homeowners 55 and older, those with disabilities, or relocating due to natural disaster
• Lifestyle & Equity:  Lower maintenance, single-level living, or cash from downsizing — while staying closer to family or healthcare

I have helped clients understand Prop. 19 benefits when moving by connecting them with local property tax experts and resources. These tools reduce costs and provide clarity for families weighing their next steps. Trusted professionals, including the Santa Barbara County Assessor’s Office and the California Board of Equalization, provide additional resources to guide these decisions.

Final Takeaway

South Santa Barbara County is gradually easing from the ultra-tight pandemic market. Home values remain strong, while interest rates improve, inventory builds, and selling times stretch slightly. It feels like a more balanced and dynamic season is ahead.

We can see both sides: Sellers can still achieve strong results with thoughtful prep and pricing, while buyers finally have more breathing room and choices. Competition may heat up again as rates continue to fall, so timing matters.

Every neighborhood has its own rhythm, and having local insight makes all the difference. I welcome your questions and conversations about the housing market — feel free to reach out directly or connect with your trusted Santa Barbara Realtor®.

Data for this article was compiled by the Santa Barbara Multiple Listing Service and analyzed by members of the Statistical Review Committee of the Santa Barbara Association of REALTORS®. Writer Kathleen Rogers is a full-time Realtor® with eXp Luxury Realty, specializing in helping friends and clients buy, sell, and remodel homes. Reach Kathleen at (805) 284-3900 and @welcometosantabarbara.