FOR RELEASE, JAN. 15, 1990

1989 Ends as Second Best Year of the Decade for

Residential Housing Sales in the San Fernando Valley

LOS ANGELES--(BW)--A total of 17,310 single-family homes and condominiums sold during 1989, making the year the second best of the decade and the sixth highest sales total in the 70-year history of the San Fernando Valley Board of Realtors.

Housing sales negotiated by Board members generated more than $4.42 billion for area homeowners and the Valley economy, said Becky Roberts, the 1990 president of the Board.

"Frankly, I'm glad the market cooled off during 1989 from the incredible, record pace set in 1988," Roberts said. "Prices will continue to rise, but a slower sales pace usually leads to slower price appreciation and that's got to be good news for young families and other prospective homebuyers."

Last year's residential real estate activity total was surpassed during the 1980s only by the 19,714 sales of 1988. The best sales year in the Board's history was 1979 when Board members negotiated a total of 19,964 sales.

Of the 17,310 residential real estate transactions last year, 12,753 were single-family homes, said Jim Link, the Board's executive vice president. The remaining 4,557 sales were condominiums.

Condos Made Strong Comeback

"Condominiums represented a strong market last year," Link said, "with sales narrowly beating out 1988, but way ahead of the mid-1980s when the condo resale market was almost nonexistent."

Through most of the 80s, condo prices stayed just ahead of inflation, increasing annually only 6 percent or 7 percent, Link said. Last year, however, the annual condo price increased dramatically, jumping 13.8 percent.

"That kind of appreciation rate makes condos much more attractive as an investment to buyers looking to build equity in order to move up the housing ladder," Link said.

The average price of condominiums sold during 1989 was $144,542, compared to the $127,017 annual average price of 1988.

By comparison, the average price of single-family homes sold during 1989 was $295,125, up 18.8 percent from the $248,492 annual average of 1988. Last year's increase, however, was below the 22.2 percent jump registered 1987 to 1988.

Strong Sales, 10% Price Hike Expected in 1990

"All indications are that 1990 will be a normal real estate market in the sense that supply will keep up with demand and that will ease the pressure on prices," Roberts said. "We expect to see a 10 percent to 12 percent increase in the average price in 1990.

"That will be still be ahead of inflation, giving owners a nice appreciation," Roberts said, "but it won't lock out so many prospective buyers so fast."

Link said that Board leaders expect sales in 1990 to be at about the same rate as 1989.

"We expect interest rates to remain favorable and perhaps come down a little, for that reason we don't see any major recession in the housing market," Link said. "People keep saying prices are falling, but they're not falling, they're just not going up as fast as they did in 1988 and early 1989."

The San Fernando Valley Board of Realtors today also reported a total of 992 home sales during December, down 29.2 percent from the 1,401 sales of December 1988.

The average price of single-family homes sold during December was $308,500, up 10.1 percent from the $280,200 average of 12 months ago.

The condominium monthly average price hit a record high during December, rising 14.7 percent over December 1988 to $154,700. A total of 284 condominiums sold in December.

-- 30 --