Interest rate drop to impact housing market in Santa Barbara

SANTA BARBARA, Calif.—Realtors aren’t exactly seeing eye to eye when it comes to what type of market we’re in.

Some argue that it’s a seller’s market, but realtor Dan Johnson says the market is more neutral, and we’re in a transition period.

“We've got inventory building and interest rates dropping. And so we have buyer opportunities now really developing. And we also have sellers that need to get realistic on pricing at the same time,” said Johnson, who works at Montecito’s Berkshire Hathaway.

We checked Zillow and noticed several listings with price cuts as high as $500,000 that have stayed on the market for over 2 months.

Johnson says inventory has been sitting on the market 29% longer now than it was a year ago.

But realtor Yawar Charlie is convinced it’s a seller’s market.

“ With the interest rate cuts. We had a lot of buyers who were sitting on the sidelines waiting for this moment, and we're going to see more buyers come into the market. And we've already seen it for homes under a $2 million price point,” said Charlie, who works at Christie’s Real Estate.

Earlier this year mortgage rates were over 7%.

Right now, they’re closer to 6.2%

Santa Barbara based mortgage banker Guy Rivera says he’s getting more calls since the Fed’s announcement.

“What types of questions are they asking you? How did the how are these how did the rate cut affect my mortgage rate soon to be and you know, I tell them the same thing. I tell them, hey, it's going to affect it, but not now. It's going to affect it in the future weeks from now,” said Rivera, the Citywide Mortgage Branch Manager.

“We're going to have more inventory available. We're going to have interest rates that are going to be down in the 5%, maybe five and a half percent range. And the buyers are going to come off the sidelines and realize this is an opportunity for them,” said Dan Johnson.

There’s one wildcard that could change the formula for everyone— the November election.

It’s just 6 weeks away and both buyers and sellers are waiting to see what happens next.