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Home sales slow in September

Single-family home and condominium sales stronger locally than the San Fernando Valley

Posted: October 26, 2011 1:55 a.m.
Updated: October 26, 2011 1:55 a.m.
 

Following a trend for the past six years, single-family home and condominium sales in the Santa Clarita Valley slowed in September as schools  started.

Following several months of improved activity, seasonal forces and ongoing consumer uncertainty regarding the economy impacted sales, the Southland Regional Association of Realtors reported Monday.

Escrow closed on 230 homes, 164 of which were for single-family homes —  down 1.8 percent from a year ago. In September, Escrow closed on 66 condominiums, which was down 7-percent from a year ago.

In contrast, San Fernando Valley single-family home sales were down 6.9 percent from a year ago, while condo sales rose 1.5 percent from the prior year.

Despite the autumn dip, all local residential sales have continued to trend upward since hitting all-time lows in January 2008. Home sales are up nearly 66 percent and condo sales are up 113 percent, since the market hit bottom nearly three years ago.

New vs. resale
The pace of local home sales will remain steady through the end of the year, but the market will be somewhat anemic until lenders come forward with reasonable loan qualification standards, said Sal Aranda, president of the association’s Santa Clarita Valley division.

“There are some people who are taking this seriously, buyers and investors who are reaping considerable benefits in terms of price and interest rates,” Aranda said.

On the other hand, there is also a cadre of prospective buyers who worry that the economic recovery is proceeding too slowly, unemployment remains too high and government has done little to prod lenders or help current homeowners, he said.

The construction of new homes is picking up in the Santa Clarita Valley though, Aranda said.

The Building Industry Association reported Monday that the SCV, unlike the rest of L.A. County, shows only pulled permits for single-family  construction, as opposed to the county’s trend of building primarily multifamily housing. New-home construction competes with resale properties.

There are attractive new-home packages luring buyers and brokers who otherwise would be focused on the exceptional value in existing housing, Aranda said.

Rising home prices
While median home prices continue to be lower than a year ago, prices have steadily been on the rise for single-family homes in Santa Clarita.

The median September home price of $360,000, a combined price for both single-family homes and condos, is up from the record low of $346,000 in January.

The combined $360,000 median also exceeds the median annual prices of $340,865 and $353,482 set in 2009 and 2010, respectively.

Locally, while home sales improve, condominium prices have set a new low, according to the Southland Regional Association of Realtors. The condominium median of $195,000 was 11-percent below September 2010.

Home sales
The number of properties coming to market continues to decline in the weakened market. There were 1,093 active listings throughout the Santa Clarita Valley, down 12.5 percent from September 2010.

At the current pace of sales, that represents a 4.8-month supply, just shy of the desired five- to six-month supply indicative of a balanced market.

Overall market
Addressing the market overall, Jim Link, CEO for the Realtors association, said there’s a demand and backlog for housing, but he criticized the increasing political rhetoric that does nothing to solve housing issues keeping homeowners, buyers and sellers anxious and stalling market recovery. Housing seems to be taking a back burner, he said.

“It doesn’t make sense,” Link said, noting that “until Congress decides to fix the secondary mortgage market and focus on jobs, we’ll see only incremental improvement.”

Little is being done, to loosen up lending requirements that prevent ready and willing buyers from owning a home, which, in turn, would further stabilize prices, thus helping the estimated 2.1 million Californians who owe more than their homes are worth, he said.

Both Link and Aranda note improvements in the pace of processing short sales, but say the persistent overhang of foreclosures depresses prices and fuels consumer uncertainty.

Still, the Santa Clarita Valley market is relatively robust compared with other communities with pending escrows, according to the Realtors association. Aranda thinks that the market will be busy through the end of the year.

The 358 open escrows reported at the end of September were up 4.1 percent from a year ago.

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