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Home prices up for second month, Realtors wary

Fannie Mae/Freddie Mac moratorium end April 1 could shift market

Posted: March 20, 2009 10:55 p.m.
Updated: March 21, 2009 4:55 a.m.
 

Home prices in the Santa Clarita Valley rose slightly in February for the second month in a row, but a real-estate spokeswoman says that doesn't necessarily mean the housing slump has hit bottom.

"Prices will remain soft until foreclosures and short sales are behind us, but I don't expect to see any further dramatic declines," said Nancy Starczyk, president of the Southland Regional Association of Realtors' Santa Clarita Division.

"If anything, given increased sales activity, prices may stabilize, but neither do I expect any dramatic upward movement in prices anytime soon."

The median price of the 167 single-family homes sold in the Santa Clarita Valley last month was $408,000, down 16.7 percent from a year ago but up 3 percent from January. January also saw a 2.9 percent increase compared to December.

The condominium median price, at $225,000, was up 9.8 percent from January.

Sales of single-family homes increased in February with 20 more homes closing escrow during February compared to January, the association's report said. There were 1,284 active listings on the SCV market at the end of February, a 6.1-percent drop from January, the report said.

"There are a lot of new buyers able to afford a home," Starczyk said. "They're finding there are more offers, and people are coming off the fence. They're ready to make their move because of unprecedented (low) interest rates and unprecedented (low) prices."

But Staczyk said it appears the trend is taking home prices slightly upward.

"It reaches a point where it levels out. It no longer becomes necessary to drop anymore," she said.

If prices continue to trend toward stabilization, the advantage of "buyer's market" could start to decline, Starczyk said.

But she added that she doesn't expect that advantage to disappear soon.

"I still think it's going to be a buyer's market all the way through till the end of the year," she said. "The foreclosures have to all sell. We have to get through all of those."

Realtor Pat Humphries said things are just too unpredictable right now.

"They (legislators, government, and lenders) are (intervening) with the process and that makes it far less predictable," said Humphries of Keller Williams Realty. "It's unpredictable because they're just trying to control what's happening."

Both Humphries and Starczyk think a second wave of foreclosures has potential to hit once a Fannie Mae/Freddie Mac moratorium ends April 1. The moratorium was put in place to ward off foreclosures.

Humphries said while the government and banks are trying to stabilize the market, the moratorium is just creating a dam of foreclosure inventory that could burst once the moratorium expires and sends prices down again.

"It depends on how fast they cycle them into the market," he said. "It's all supply and demand."

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