🎃 What’s Scarier: The Real Estate Market or Ghost Village Road?

Fall has officially arrived — at least on the calendar! While stores are already rolling out Halloween (and even Christmas) décor, October is one of the best months in Santa Barbara. The sun is shining, the weather is gorgeous, and the city is buzzing with activity. With UCSB back in session, 40,000 students have returned to Goleta, making traffic a bit more… spirited.

In our family, October means Halloween fun — decorating the house, taking the kids to Ghost Village Road, and trick-or-treating in our neighborhood. I love seeing the creative costumes and festive homes. Do you have a favorite hidden Halloween spot I should know about?

Now, onto the market. We’re still waiting for September’s official numbers, but here’s what we’re seeing:

• Many homeowners have had to reduce prices or accept less than expected to get sold.
• Homes that are priced right and in great condition can still attract multiple offers and even sell over asking — though it’s not as common as in 2021.
• Pending home sales were up 4% in August compared to July, and 3.8% year-over-year.
• Mortgage rates dipped near 6% last month, though they’ve ticked up slightly with stronger economic news.

Looking ahead, this government shutdown could push interest rates lower, since investors often move toward U.S. Treasury Bonds during times of uncertainty. Many economists believe that once rates fall below 6% — ideally closer to 5.5% — we’ll see real momentum return to home sales.

Traditionally, fall and winter bring a slowdown in listings and closings. But September felt unusually busy, likely thanks to lower rates. Today’s buyers are savvy — they’re willing to purchase, but only if they feel they’re getting a deal. If a home isn’t priced correctly, buyers will push hard for reductions.

👉 Bottom line: Price matters more than ever. With the right strategy, homes are still selling — and buyers are still buying.

If you’d like to talk about how these market shifts affect your real estate goals, I’d love to connect.

📲 Call, text, or email anytime — I’m here to help!

Late-summer jump in home buying activity bucks expectations 

By Dave Gallagher 
Real Estate News

Pending home sales showed surprising strength last month in what could be a sign that the housing market has taken a small step in the right direction.

New contracts were up 4% in August compared to July and up 3.8% year-over-year, according to the National Association of Realtors. This beat the expectations of many forecasters, who widely expected flat sales numbers as the summer wound to an end.

This latest data indicates that buyers are re-engaging — but caution remains, according to Odeta Kushi, deputy chief economist at First American. "Improvements in mortgage rates, affordability, and inventory are helping, but not yet driving a full recovery in housing demand," Kushi said.

If mortgage rates continue to decline, the drop would boost not only home sales, but refinancing — and that would be "a positive for near-term consumer spending," according to Ryan Sweet, chief U.S. economist at Oxford Economics.

"Housing will find its footing and begin to improve more noticeably as the 30-year fixed mortgage rate closes in on 6%," Sweet said.

Possible impact of a government shutdown: But mortgage rate volatility may begin this week if the federal government shuts down on Oct. 1.

While government shutdowns typically result in lower mortgage rates, this particular shutdown could stall a key jobs report slated for release on Oct. 3 — and that delay would leave investors with less information about what is happening within the economy.

A drop in inventory won't help: While lower mortgage rates may entice some market activity, inventory could become real estate's next hurdle as more sellers pull their home listings.

"The uptick in delisting activity reflects the transitioning housing market, as would-be sellers take their home off the market when they are not getting offers at the price they had hoped for," said Lisa Sturtevant, chief economist at Bright MLS.

Locked-in impact: All of these changes are occurring as the lock-in effect widely attributed to pandemic-era mortgage rates loses impact. The share of U.S. homeowners with mortgage rates of 6% or higher rose to 19.7% in the spring — a 10-year high, according to Redfin data. 

Meanwhile, the share of those who have rates below 6% has dropped from 92.7% in the second quarter of 2022. Redfin's Sept. 29 report found that 52.5% of homeowners still have rates below 4%, down from 65.1% three years ago.

For now, mortgage rates "have not gone down significantly enough to move the needle," according to Mariah O'Keefe, a Redfin Premier agent in Seattle who said buyers "need to see a bigger difference in their potential monthly payment before things are going to change."

"If rates tick down below 6%, that will bring a lot of people back into the market," O'Keefe added.

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California Housing Market Forecast for the Next Year: 2026 Predictions

By Marco Santarelli
Norada Real Estate Investments
 

The California housing market in 2026 is shaping up to be a year of modest growth and slightly improved affordability. While we won't see the rapid surges of years past, expect a gentle uptick in home sales and a record-breaking median price that hints at a market finding its footing after more challenging times.

I've seen cycles come and go. It's always tempting to focus on the dramatic swings, but sometimes the most insightful observations come from understanding the subtle shifts. The California Association of Realtors (C.A.R.) latest forecast for 2026 offers a glimpse into a market that's stabilizing, and for many, that stability is actually good news.

California Housing Market Forecast for the Next Year: 2026 Predictions

Sales on the Upswing, But Don't Expect a Frenzy

According to C.A.R., we're looking at an increase of about 2 percent in existing, single-family home sales in 2026. This means an estimated 274,400 units could change hands. This might not sound like headline-grabbing news, especially when you compare it to the booming sales numbers of a few years ago. However, it’s a welcome step up from the projected 269,000 sales for 2025, which itself is a slight dip from the 269,200 homes sold in 2024.

Think of it like this: the market has been catching its breath. After a period of intense activity, it's natural for things to calm down a bit. This projected increase in sales in 2026 signifies a gradual return to normalcy, rather than a mad dash. For buyers who have been priced out or overwhelmed by competition, this could mean more options and a slightly less frantic search.

A New Price Record, But At a Slower Pace

Here's a fact that will likely grab attention: California's median home price is forecast to hit a new projected record of $905,000 in 2026. This represents a 3.6 percent increase from the projected $873,900 in 2025. It’s important to remember that this follows a more modest 1 percent rise in 2025 from the $865,400 median price in 2024.

Now, I know what some of you might be thinking: “More expensive? Great!” But it's crucial to dig a little deeper. This 3.6 percent growth is significantly slower than the double-digit increases we've witnessed in some prior years. This is a key indicator that the market is moving away from rapid appreciation and towards a more sustainable growth pattern. As C.A.R. President Heather Ozur mentioned, “Home prices in California are expected to rise in 2026, but the growth pace will remain mild when compared to rates we’ve seen in past years.” This is a message of moderation, not runaway inflation.

Improved Affordability: A Breath of Fresh Air

One of the most encouraging pieces of the 2026 forecast is the projected increase in housing affordability. We're looking at the Housing Affordability Index inching up to 18 percent in 2026, from a projected 17 percent in 2025, and 16 percent in 2024.

What does this mean for the average Californian? It means a slightly larger percentage of households will be able to afford to buy a median-priced home. This improvement is largely driven by a projected decrease in mortgage interest rates. C.A.R. forecasts the average 30-year, fixed mortgage rate to dip to 6.0 percent in 2026, down from 6.6 percent in 2025. While these rates are still higher than the pre-pandemic era, they represent a significant improvement from recent years and are well below the long-term average of nearly 8 percent. Lower interest rates, combined with a slight uptick in inventory, creates a more favorable environment for buyers....

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