Despite widespread belief that the local housing market is well on its way to recovery, sales of existing single-family homes and condos during February in the Santa Clarita Valley came in lower than anticipated, the Southland Regional Association of Realtors reported Wednesday, March 23.
A total of 116 homes and 53 condos closed escrow last month, down 17.1 percent and 3.6 percent, respectively, compared to a year ago. However, both remain well above their recession lows — up 17.2 percent for homes and 71.0 percent higher for condos.
“We’ve faced the facts that the market has changed,” said Sal Aranda, president of the Association’s Santa Clarita Valley division. “Now consumers have to get over the uncertainty and, one step at a time, embrace the new realities.”
Those realities include the fact that banks are beginning to write more home loans with near record-low interest rates, that housing affordability is high while appreciation will be modest, and that some buyers have an exceptional advantage.
“Buyers who come to the table with cash, a job and an excellent credit history can rule the process,” Aranda said. “This is the time to move up to a bigger or better home and there are incredible opportunities out there for those who want to become a landlord.”
Aranda and Jim Link, the Association’s chief executive officer, expect sales to pick up as warmer weather approaches, the market absorbs the impact of the end of federal and state homebuyer tax credits and the market continues to resolve a diminishing, yet still significant, problem with distressed properties.
“Banks are working really hard to improve the short-sale process, which prevents a home from going into foreclosure, helps owners who owe more than a property is worth, and brings an attractively priced property to the market,” Link said. “It’s gradually getting easier with the bigger banks to get a short sale approved, while smaller lenders are still struggling to understand the complexities of local markets.”
Link noted that statewide reports show that foreclosures are going down and short sales are on the rise, a switch that supports reports that some lenders are changing their emphasis.
While down from a year ago, the monthly median of homes and condos sold during February increased from record lows. The single-family median of $385,000 was up 11.3 percent from this January while the condo median price of $230,000 improved 15.0 percent. Compared to a year ago February, both fell, 6.1 percent and 8.0 percent, respectively.
“It will take at least another year or two for the market to work through remaining foreclosures and short sales,” Aranda said. “Combine that with issues like the uncertain fate of Freddie Mac and Fannie Mae, which help make loans readily available, and it’s easy to understand why some consumers hesitate.
“Yet those who remain indecisive will surely miss an opportunity,” Aranda said.
The Southland Regional Association of Realtors® is a local trade association with more than 10,000 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.
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