As you look at the graph for “Homes and PUD’s (Planned Unit Developments) Median Sales Price January thru November 2005-2008” it gives a thumb nail sketch of current market conditions heading into the last month of the year. However, instead of comparing this year to last year, as in a “year over year” comparison, it compares the median sales price for the 3 previous years up to 2008. What I like to do to add some historical perspective to the information and achieve more reliable data over time is to also AVERAGE the 3 previous years and compare that median price average to the same period for the yare 2008. When this is done we discover that our comparative depreciation to date is -14%. But when we consider the “year over year” comparison between 2007 and 2008 in median sales price for the same period we notice a strikingly similar figure of -15% depreciation.
This is not bad when we consider that California is experiencing more than double this depreciation rate on a year over year basis for the same time period in the year 2008 and the fact that Santa Barbara homeowners enjoyed approximately 295% appreciation between the years 1996 and 2005. This appreciation was historically unprecedented and could not be sustained.
Santa Barbara is a world renowned city with a unique economic base and after a period of adjustment it will be back.
Graph Source: Gary Woods
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