February 2010 Economic Forecast (short summary)

Yesterday I attended the Real Estate & Economic Forecast at Fess Parker's Doubletree Hotel. Here's my short version, and soon I will provide a longer version for those of you who love details.

To quote Deputy Chief Economist of C.A.R., Mr. Robert Kleinhenz, he says that "Things are getting less worse." (And he told us to forgive his grammar.)

In 2009, we sold $1.2 billion ($1,171,024,679 to be exact) in home sales, and we sold another $175 million in condo sales. Our market is still moving. 2010 is being called a "transition year" with the economy giving mixed signals for the next 6-12 months, but the numbers show that the worst is behind us (February 2009 was the trough, based on the numbers), and the economists are relieved to now have a benchmark to look back and refer to. Dr. Mark Schniepp said to Randy Glick that although the popular opinion is that we are bracing for another shoe to drop, he believes the recession is over. He says there will be no double dip, we are stable, high end lending will thaw, the economy will heal on its own, the job market will improve, our number of homes sold will go up, and and we will see a 5-7% increase in the median sales price in 2010 in Santa Barbara. His quote was, "Be patient. It's still raining but the biggest storm has passed." And to quote Randy Glick, "We wake up in a beautiful city. A study came out that showed Santa Barbara was the 5th best city in the United States in which to live, and the study is flawed...because we live in paradise." (I agree with Randy.)

To give my two cents on this, our Santa Barbara real estate market under $1mm is getting tighter. The high end homes still may see further price adjustments, and I will back up the statements above soon when I write more thoroughly on the data provided yesterday.