A metro area on California’s central coast ranked No. 1 in the latest WSJ/Realtor.com Emerging Housing Markets Index
4 min
It’s an area already popular with the likes of Oprah Winfrey, Ellen DeGeneres, Prince Harry and Meghan Markle.
But now the affluent Santa Maria-Santa Barbara metropolitan area on the Central Coast of California nestled between the Santa Ynez Mountains and the Pacific Ocean has ranked as the top housing market in the latest Wall Street Journal/Realtor.com Emerging Housing Markets Index, released Wednesday.
It’s a surprise result for the quarterly index, which has, until now, typically seen more affordable cities rank at the top—Topeka, Kansas, took first place in the prior iteration of the report, released in fall, and Lafayette, Indiana, in the summer ranking.
“Santa Maria-Santa Barbara topping the list serves to highlight the division in today’s housing market,” said Danielle Hale, chief economist at Realtor.com. It’s the one and only West Coast market in the top 20, and, with a median listing price of $1.795 million in December, the highest-priced market by more than $1 million.
The top five cities in the index were rounded out by Jefferson City, Missouri, where the median listing price was $302,000 in December; the Canton-Massillon metro area in Ohio ($230,000); Racine, Wisconsin ($334,000); and the Oshkosh-Neenah metro area in Wisconsin ($295,000).
“Many housing markets cooled off after the pandemic’s run-up in prices and inventory-depleting demand,” Hale explained. “The markets that have continued to chug along, and even gain steam, are either priced low enough that buyers can compete, or priced high enough that the typical affordability constraints are not of concern to the market’s buyers.”
The latter is the scenario that’s playing out in Santa Barbara.
The index analyses key housing market data, as well as economic vitality and lifestyle metrics for the largest 300 metropolitan areas in the country to highlight emerging housing markets that offer a high quality of life and are expected to see future home price appreciation. It identifies markets that those considering a home purchase should add to their shortlist—whether the goal is to live in it or rent.
Santa Barbara “offers perhaps the finest lifestyle in the U.S.,” said local agent Luke Ebbin of The Ebbin Group at Compass. “Three-hundred days of sunshine and warm weather, a relaxed pace of living, proximity to uncrowded beaches, mountain hikes, fine food and wine, and incredible cultural offerings more often found in major metropolitan areas.”
However, with that median listing price of $1.79 million—more than four times the national median—the price tag attached to the idyllic locale is well out of range for many would-be buyers.
“Though Santa Barbara is among the highest-priced large housing markets in the U.S., buyers in the area have seen similar trends to buyers in other more affordable markets,” Hale said. “For-sale inventory fell rapidly during the early days of the pandemic, and has not recovered much as demand waned in the area and homeowners chose not to sell.”
As a result, “buyers hoping to snag a median-priced home are facing more competition, which has driven prices higher,” she said.
In December, 71% of homes on the market in the metro were priced at $1 million or higher, up from the same time in 2019, when the metric stood at 62%.
“Buyers who have been eager to purchase here and have been on the sidelines due to low inventory and high interest rates are entering the market as rates decline and more inventory becomes available,” Ebbin said. That “low inventory and high demand are keeping prices elevated.”
It should come as no surprise then that Santa Barbara boasts an affluent population who “are drawn to the area’s lifestyle, amenities and upscale housing options,” said Santa Barbara-based agent Jason Streatfeild of Douglas Elliman.
Santa Barbara has “long been a popular destination for retirees, especially those seeking a mild climate, beautiful scenery and a relaxed coastal lifestyle,” Streatfeild said, noting that many migrate from colder regions of the country, as well as from other parts of California.
Not only charmed by the balmy wealth, individuals from far and wide are equally wooed to the area by its thriving entrepreneurial community, and Santa Barbara’s “robust job market, including opportunities in technology, healthcare, finance and education, attracts professionals from various parts of the country,” Streatfeild said. “Some may relocate from major metropolitan areas like Los Angeles, San Francisco or New York in search of a more balanced and less crowded lifestyle.”
Indeed, out-of-towners appear to be driving demand in the coastal enclave, according to search data from Realtor.com. More than three-quarters (79.5%) of views to Santa Barbara home listings on the site came from outside of the metro in the fourth quarter, with a notable amount of attention coming from the Los Angeles (32.8%) area, according to the index. House hunters from Silicon Valley, Atlanta and New York City were also shopping in the area, according to Realtor.com data.
Meanwhile, Prince Harry and Megan Markle are prime examples that “Santa Barbara’s appeal extends beyond U.S. borders,” Streatfeild said.
The University of California, Santa Barbara, also attracts a global cohort—along with plenty of domestic new residents—who move to the area to pursue higher education.
The Santa Barbara metro area “attracted a sizeable 3.3% of its listing viewership from shoppers outside of the U.S.,” Hale said in the report. “Suggesting that international demand is applying pressure to already high prices.”
For comparison, “the average international viewership share across the 300 ranked markets was less than half (1.4%) the viewership share in Santa Barbara,” she added.
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What a quarter-million dollars gets you in the western capital.
Alexandre de Betak and his wife are focusing on their most personal project yet.
3 min
Many luxury hotels only build on their gilded reputations with each passing decade. But others are less fortunate. Here are five long-gone grandes dames that fell from grace—and one that persists, but in a significantly diminished form.
A magnet for celebrities, the Garden of Allah was once the scene-making equivalent of today’s Chateau Marmont. Frank Sinatra and Ava Gardner’s affair allegedly started there and Humphrey Bogart lived in one of its bungalows for a time.
Crimean expat Alla Nazimova leased a grand home in Hollywood after World War I, but soon turned it into a hotel, where she prioritised glamorous clientele. Others risked being ejected by guards and a fearsome dog dubbed the Hound of the Baskervilles. Demolished in the 1950s, the site’s now a parking lot.
The Astor family hoped to repeat their success when they opened this sequel to their megahit Waldorf Astoria hotel in 1904. It became an anchor of the nascent Theater District, buzzy (and naughty) enough to inspire Cole Porter to write in “High Society”: “Have you heard that Mimsie Starr…got pinched in the Astor Bar?”
That bar soon gained another reputation. “Gentlemen who preferred the company of other gentlemen would meet in a certain section of the bar,” said travel expert Henry Harteveldt of consulting firm Atmosphere Research. By the 1960s, the hotel had lost its lustre and was demolished; the 54-storey One Astor Plaza skyscraper was built in its place.
In the 1950s, colonial officers around Africa treated Mozambique as an off-duty playground. They flocked, in particular, to the Santa Carolina, a five-star hotel on a gorgeous archipelago off the country’s southern coast.
Run by a Portuguese businessman and his wife, the resort included an airstrip that ferried visitors in and out. Ask locals why the place was eventually reduced to rubble, and some whisper that the couple were cursed—and that’s why no one wanted to take over when the business collapsed in the ’70s. Today, seeing the abandoned, crumbled ruins and murals bleached by the sun, it’s hard to dismiss their superstitions entirely.
The overwater bungalow, a shorthand for barefoot luxury around the world, began in French Polynesia—but not with the locals. Instead, it was a marketing gimmick cooked up by a trio of rascally Americans. They moved to French Polynesia in the late 1950s, and soon tried to capitalise on the newly built international airport and a looming tourism boom.
That proved difficult because their five-room hotel on the island of Raiatea lacked a beach. They devised a fix: building rooms on pontoons above the water. They were an instant phenomenon, spreading around the islands and the world—per fan site OverwaterBungalows.net , there are now more than 9,000 worldwide, from the Maldives to Mexico. That first property, though, is no more.
The Ricker family started out as innkeepers, running a stagecoach stop in Maine in the 1790s. When Hiram Ricker took over the operation, the family expanded into the business by which it would make its fortune: water. Thanks to savvy marketing, by the 1870s, doctors were prescribing Poland Spring mineral water and die-hards were making pilgrimages to the source.
The Rickers opened the Poland Spring House in 1876, and eventually expanded it to include one of the earliest resort-based golf courses in the country, a barber shop, dance studio and music hall. By the turn of the century, it was among the most glamorous resort complexes in New England.
Mismanagement eventually forced its sale in 1962, and both the water operation and hospitality holdings went through several owners and operators. While the water venture retains its prominence, the hotel has weathered less well, becoming a pleasant—but far from luxurious—mid-market resort. Former NYU hospitality professor Bjorn Hanson says attempts at upgrading over the decades have been futile. “I was a consultant to a developer in the 1970s to return the resort to its ‘former glory,’ but it never happened.”
