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Housing prices rise to highest level in five years

Posted: July 29, 2013 5:17 p.m.
Updated: July 29, 2013 5:17 p.m.
 

The price tag of homes in the Santa Clarita Valley rose to their highest levels since 2008 last month as shrinking inventory continued to drive up prices.

The median price for a single-family home in the Santa Clarita Valley was $430,000 in June, up $70,000 since January of this year and the highest in five years since September 2008, according to data released Monday by the Southland Regional Association of Realtors.

The same trend was tracked for condominiums. The median price for condos in June of $263,000 was an increase of $56,300 since January. It is also the highest sale price since August 2008.

Rising prices come as the number of distressed properties continues to drop.

Standard home sales — in which the owner has equity in the home — accounted for 69 percent of all sales in June.
That percentage is more than double the number of sales a year ago, when standard sales only accounted for 32.5 percent of all sales locally.

Foreclosures represented only 7.3 percent of all SCV sales in June. Short sales represented 23.1 percent of all sales. Both types of sales are down from 2012.

Housing price increases offer a boon for those who have been “upside down” in their mortgages, one Realtor said.

“Rising prices are an enormous help for homeowners who owe more than the current resale value of the house, lifting them ever closer to a positive equity position,” said Bob Khalsa, president of the SCV Division of the Southland Regional Association of Realtors.

Rising prices and higher interest rates narrows the pool of buyers who can qualify to buy at the higher prices.

“Satisfying demand will be difficult unless inventory increases,” Khalsa said.

A larger inventory would ease the pressure on rising prices, he said.

There were nearly one-quarter fewer homes actively listed for sale last month compared to a year ago.

The 428 active listings represent a 1.4-month supply in the Santa Clarita Valley.

Experts say a five- to six-month supply represents a healthy inventory level in which neither the buyer nor the seller has an advantage.

The 199 homes sold in June represent a decline of 16.4 percent, down from 238 homes sold a year ago.

“Recent hikes in the interest rates may have some dampening effect on the market recovery,” said Jim Link, the association’s chief executive officer. “Higher interest rates, coupled with higher prices, means buyers qualify for a lower purchase price.”

Rates, however, are just over 4 percent, so any resulting slowdown in sales may allow inventory to grow, Link said.

And if more homes become available, the increased inventory may ease the pressure on prices, he said.

jana@signalscv.com
661-287-5599

 

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