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Home sales rising after three-year lull

Brokers split on where trends will take market

Posted: February 28, 2009 1:39 a.m.
Updated: February 28, 2009 12:46 a.m.
 
Buyers took advantage of low prices and interest rates boosting sales of single-family homes in the Santa Clarita Valley 10.1 percent in 2008, the first increase in annual sales after three consecutive years of declines.

But one broker warns that this could be the lull before the storm. Some local realtors anticipate a significant problem in the months ahead after a federally imposed moratorium on foreclosure processing expires March 1.

“Prospective buyers are starting to pay very close attention to the numbers,” said Nancy Starczyk, president of the Southland Regional Association of Realtors-Santa Clarita Valley Division.

“The sense is that the pendulum is on the upswing with many people believing they need to make their move now,” Starczyk said Friday. “All the indicators suggest that activity will pick up even more in the second half of the year.”

Interest rates dropped to an enticing 4.78 percent.

The single-family median price for Santa Clarita Valley homes in January was $396,000, a 13.9-percent decrease from January 2008.

The condominium median price was $205,000, down 28 percent from January 2008.

Local agents negotiated single-family home and condo sales totaling more than $1.3 billion dollars in 2008.

“Prices have fallen to a point where people who were unable to buy just a year or two ago now can get a home,” said Jim Link, the association’s CEO. “While there are still foreclosures and short sales on the market, all in all, we’re optimistic and we believe that the worst is past.”

The decline marked the second consecutive year prices fell. It comes on the heels of eight consecutive years of increases.
Realtors closed escrow on 147 single-family homes in the Santa Clarita Valley in January, up 48.7 percent from January 2008.

Condo sales showed a 74.2-percent increase from the previous year.

Realtors closed 2,194 single-family home sales in 2008, compared to the record low of 1,993 transactions of 2007.

“People are lured by the low prices and will feel they can buy again as they gain more confidence in the economy,” Starczyc said.

“The numbers are good and people who have the money to buy are getting ready to do it,” said Phil Nordella, owner of Realty Executives of Santa Clarita. “They want to buy soon, because no one knows when things are going to change again.”

The feds are planning to grant a hold on foreclosures for troubled homeowners starting December 1.

The moratorium has given those already in foreclosure who can’t afford their payments a chance to stay in their homes an extra few months, and will not have their foreclosure finalized until after the moratorium is over.

“We are not seeing foreclosures right now because of this moratorium, but come April 1, things will look very different,” Nordella said.

Nordella converted two of his four realty offices located in the Santa Clarita Valley into foreclosure centers in response to the public’s need for representation during foreclosures.

He fears for what the next few months will bring to the current upswing in the housing market.

As far as Nordella is concerned, this is just the lull before the storm.

“It’s very encouraging to see home sales going up,” Nordella said, “But when things get back to business as usual in another month or so, who knows what will happen.”

On a brighter note, tax credits will be issued to first-time homeowners, or people who have not bought a home in the last three years, in the amount of $8,000 upon purchase of the home, he said.

Banks will also give a $10,000 tax credit to those who buy a brand new home.

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