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Introduction to Santa Barbara Real Estate
Investing in Santa Barbara real estate and Montecito real estate has both tangible and intangible rewards. The process can be rather complex. Both your results and success will vary depending on your knowledge of the market and your understanding of the elements that will comprise the basis of your purchase transaction. You´ll want to investigate the properties that are available from the “Property Search” features on the web site. It cannot be overstated that the benefits that you will receive from working with an experienced Realtor can and will make all the difference in the world in navigating the complexities of a real estate transaction. The peace of mind alone is worth the time in interviewing and finding the right Realtor for you.
The following guideline is intended as a review of the process of buying real property. As you shall see, there will be a lot of information to consider as well as a number of professionals from whom you may wish to seek advice from as you move through the stages of research, financing, negotiations, escrow, inspections, and the resolution of any obstacles prior to taking title and ownership of your new property. Take a moment and search Santa Barbara Homes for Sale (click on link above) to see what properties are currently available in Santa Barbara real estate and Montecito real estate.
People own real estate for three basic reasons; primarily as a place to live, as an investment where appreciation of value and/or income are anticipated and finally and as a lifestyle enhancement where the property could be used as a second home, vacation home or held for aesthetic purposes. There may be times when these considerations overlap and your investment perspective will be multi faceted.
Real estate in Southern California, Santa Barbara, Montecito and the surrounding areas of Carpinteria, Summerland, Hope Ranch, Goleta, GaviotaCoast, Santa Ynez, Los Olivos and Solvang can offer you a diverse range of properties to consider. There are many luxury homes, investment properties, single family residences, multi million dollar houses, estates, ranches, condominiums and even fixers, vacant land, lots and acreage to choose from. In the Santa Barbara area the architecture has been inspired by our Spanish heritage but you´ll also find a range of styles from traditional to contemporary.
Views are often breathtaking with panoramas of the ocean, mountains, city, harbor, coastline, the Channel Islands and even setting views are very attractive with gardens and stately oak trees. The Santa Ynez Valley also known as Santa Barbara´s wine country offers a more casual lifestyle where the properties are no less spectacular and the views overlook vineyards, ranchland and mountain panoramas.
It´s easy to see why Santa Barbara real estate and Montecito real estate has had such strong demand. Just look at the values in the Santa Barbara MLS.The year round weather is outstanding with a mild Mediterranean style climate. There is a sense of place within the community that encompasses the Spanish heritage of old California and the cultural traditions of contemporary America. Santa Barbara´s size is very manageable, yet the availability of activities, events, educational opportunities, transportation and health care rival metropolitan areas many times our size. When one considers the meaning of the concept 'quality of life' in respect to places to live, Santa Barbara consistently scores amongst the premier locations in the world. Now that you are at least partially convinced that Santa Barbara is a great place to live, let´s look at buying Santa Barbara real estate and Montecito real estate.
Learning the Market Areas
Each of the cities, towns and communities listed above has their own unique character and style as well as some of the gated communities within these areas. There will be a range of architectural styles from which to choose. The locations where homes have been built around Santa Barbara have been kept to rather defined and finite areas; undeveloped locations are becoming scarcer every year. This is not to say that Santa Barbara is overbuilt, quite the contrary; Santa Barbara values its´ open spaces. Santa Barbara has kept growth under control with considerations for density, aesthetics, environment, conservation and impact on the general community. Thus the property values here are some of the highest in the country.
It will be prudent to learn and understand the value of properties that you may be considering before making an offer. There are many factors that contribute to the value of a property such as: location, conforming and non conforming values of properties in that location, the relationship of a particular property and its´ value as compared to comparable properties in other locations, unique factors that may affect the value of a property in a location (aesthetics, views, utility, geology, fire zone, environmental hazards, easements, title restrictions, non conforming use, neighborhood conditions), market trends for that location, comparable alternative properties, the zoning classification for the property, CC & R´s (Conditions, Covenants and Restrictions) that may apply to the property, access to and the service of utilities, the improvements (quality, style and size) developed on the property, conforming use and design as compared to the neighborhood, demand for that type of property, scarcity of that type of property and how closely it matches your investment goals.
Financing Your Purchase
You probably have a very good idea of the price range that you would like to consider for your real estate purchase. The education that you´ve experienced through your market research will have helped you define the market segment and target price range of your purchase. In principle, the structuring of the financing of your purchase will either be all cash or involve financing. In either event, this will result in all cash to the seller at the close of escrow unless the seller had previously agreed to participate with your financing.
In the case of an all cash purchase, it will be prudent to consult with your financial advisor as to the timing of events to liquidate any assets that will be converted to cash so that the funds will be available at the close of your escrow on the new property. If traditional or private financing will be a part of your transaction, a longer time line will be needed to allow for the exchange of information necessary for the approval of your loan.
If you will be financing your purchase, it may be to your advantage to investigate the opportunities available, their options and lender requirements prior to making an offer on a property. This will give you the opportunity to be 'pre-qualified' by a lender which may give a seller more confidence in working with and accepting your offer. Eventually the subject property will be reviewed by the lender and appraised with consideration given to the purchase agreement, any inspection reports generated and the title report before finalizing the loan approval. In this regard it would be wise to establish a relationship with a local lender. These lenders are familiar with the local market areas and the properties found there. Thus they have more confidence when reviewing a loan package for a property in these areas and the approval process will more than likely go smoother than one with a lender outside of the area. There are exceptions of course, but if there is any doubt, submitting multiple loan applications may be to your advantage.
Negotiating the Purchase
This will be one of the most important steps in the purchase process as it will set the guidelines of the transaction as it moves through escrow defining the obligations and relationships of the participants. Keep in mind that goals that are clearly defined are easier to focus on. There may be a variety of underlying factors which need to be considered prior to drafting a purchase proposal. Do your homework. Consider the price and terms; these are the two elemental factors in a purchase agreement. Rarely will you be able to control these cornerstones of a transaction to an unfair advantage. Determining a property´s value and reaching an agreement on price will be a primary concern. In a perfect world buyers and sellers would agree upon a 'fair market value'. This would be a price at which a property would change hands between a willing buyer and willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts.
You can see that to reach this optimum position on price, that the parties involved would be both educated about the market, the property under consideration and reasonable with their expectations. As you can imagine, it can be a challenge to reach a meeting of the minds. Most homes and land parcels in the Santa Barbara real estate market are unique and making equitable comparisons comes with experience and broad knowledge of the market. Access to this experience and knowledge will be invaluable in structuring a sound position in a purchase agreement.
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