Cooling Trends in Montecito & Santa Barbara Real Estate

Community Spotlight: Cooling Trends in Montecito & Santa Barbara Real Estate

After years of record-breaking activity, the real estate market in Montecito and Santa Barbara is showing signs of balance returning. Inventory is up significantly—Montecito listings have increased to 89, with the median list price for 93108 being $7,525,000. Homes are spending more time on the market, averaging 76 days. In Santa Barbara, sales have slowed, with median prices holding around $1.885 million and homes taking longer to close. 

For sellers, this shift means strategic pricing, polished presentation, and expert marketing are more critical than ever to stand out. For buyers, the increase in inventory offers more choices and negotiating power than we've seen in recent years.

While luxury remains resilient, buyers are moving cautiously, especially in the $5M+ range. This evolving market favors those with experience and insight.

 Here’s what’s unfolding this July:

Increasing Inventory, Slowing Pace

June 2025 brought notable shifts in the Santa Barbara market, signaling a move toward balance:

• Active listings jumped 23.8% year‑over‑year (from 623 to 771) averaging 97 cumulative days on the market Santa Barbara Association of REALTORS®
  
  

• Median home sale price hit $2,197,700, with the average sales price for 81 sales reaching $3,340,114, reflecting steady growth
  
  

• YTD median sale prices climbed 13.2% (from $2,242,500 to $2,537,500)
  
  

• In the broader Santa Barbara area, 398 SFR + PUD homes were for sale in June—a 40.6% increase since January; meanwhile, 81 homes sold, down 12.9% since May.
  
  

• Of the active listings, the cumulative days on market increased 11.5% to 97 in June, up from 87 CDOM in May. 73% of homes still sold within 30 days.
  
  

• Of the 113 sales in June, 40% were all cash deals and 26% sold over asking. Of the 676 deals in Q2, 39% were all cash.
  
  

• Takeaway: For sellers, strategic pricing and polished presentation are essential in a more competitive landscape. Buyers now enjoy increased options and negotiation leverage—an ideal time to act.
  
  

What This Means Locally

• Buyers’ advantage: With more inventory and slower market movement, buyers now have more time to evaluate and negotiate.
  
  

• Sellers’ challenge: Effective pricing, staging, and marketing are essential to stand out in a market that’s shifting from a seller’s frenzy to a more balanced landscape.
  
  

• Luxury segment specifics: Montecito still attracts affluent, often cash buyers—though they’re more cautious—so properties must match the elevated expectations of such clientele.
  
  

Quick Takeaways: