Santa Clarita Valley Home Sales Post Strong Increases

Buyers eager to capture bargains on foreclosed properties pushed sales of existing single-family homes in the Santa Clarita to their highest level in months, posting the fourth consecutive month of gains and the first year-to-year increase in 13 months, the Southland Regional Association of Realtors reported .

A total of 178 homes changed owners last month, up 2.3 percent from a year ago and 17.9 percent higher than the March tally. Sales had been trending downward since hitting a record high of 405 transactions in June 2005, but the April total was the first time since March 2007 that the total was higher than 12 months ago.

Even condominium resales posted the fourth consecutive month of increased sales with the 67 transactions during April up 24.1 percent from March. Condo sales were 1 1.8 percent below a year ago. "With about 50 percent of the current inventory consisting of foreclosed properties or short-sales, buyers are coming out in droves to take advantage of what may well be a once-in-a-lifetime opportunity," said Doreen Chastain-Shine, president of the Association’s Santa Clarita Valley Division.

"I’ve had agents call to report that a growing number of properties are receiving multiple offers within days of being listed for sale. Some of them see the price being bid up above the asking price. "It’s a very hopeful prognosis," she said. "I totally believe that the local market has hit bottom and is turning." Pending escrows - a measure of future resale activity - support that optimism.

There were 381 open escrows at the end of April, up 34.2 percent from a year ago and 24.1 percent higher on a month-to-month basis. Activity has been steadily rising since hitting bottom in December when there were a mere 160 open escrows. The record high of 662 open escrows was set in March of 2005.

"We’ll need a few more months of statistics to be sure that positive trends emerging today are solid, but the market clearly is evolving and activity clearly is on the rise," said Jim Link, the Association’s chief executive officer. "Prices will remain soft until foreclosures and short-sales caused by the sub-prime lending melt-down have moved through the system, but anyone waiting in the hope of a steep price drop probably will be disappointed and miss an excellent opportunity to buy a home."

The single-family median price has been fluctuating in the mid- to high-$400,000 range with the $480,000 median in April down 19.3 percent from a year ago, but up 2.1 percent from March. The first four months of the year saw the median slip under $500,000 for the first time in 16 months. The record high median of $643,000 was set in April 2006.

Similarly, the condominium median price of $279,000 was down 27.5 percent from a year ago, off $106,000 from the $385,000 median of April 2007. It has been slowly falling since the record high of $387,000 was set in January 2006 with the March median of $275,000 being the low point in this cycle to date.

Many factors mitigate against steep price declines, including: pent-up demand for housing in an area of the nation that will see population gains in coming years, lenders again writing loans which carry favorable interest rates, the lower cost of jumbo loans in high-cost regions now that the conforming loan rate has been increased, assistance for beleaguered home owners, which will limit the number of foreclosures, and an inventory that offers a solid selection but is not excessive.

"Unlike just a short while ago, one out of every three families throughout Los Angeles County can now afford to buy a median-priced home," Chastain-Shine said. "Consumers recognize the opportunity and realize that the first to jump into a changing market often are the ones who capture the best opportunities."

The number of homes listed for sale declined during April compared to a year ago, down 6.8 percent to 2,014 active listings.

The inventory at the current pace of sales represents a mere 8.2-month supply, still a buyers’ market yet not all that far ahead of the 5- to 6-month supply thought to represent a balanced market. It also was the first time in months that the number of active listings dropped into single-digit range, supporting conclusions that the market is changing as the Spring home-buying season gets into full swing.