The residential housing resale market in the Santa Clarita Valley continued to recover during February, with sales and prices up to their highest levels in years, the Southland Regional Association of Realtors reported on Tuesday, March 19.
The 153 homes that changed owners last month represented a 10.9 percent increase over a year ago and a 2.7 percent gain from the January tally. While typically a slow time of year for home sales, the February figure was the highest for the month since February 2008. Local home sales have increased 54.5 percent from the low point of January 2008.
Likewise, the 69 condos that closed escrow during February were up 25.5 percent over February 2012 and 16.9 percent higher than this January. It was the best total for the month since 2007. Condo sales were up 122.6 percent from the record low of 31 sales set in 2008.
“Santa Clarita is recovering faster than some Southern California communities because of our demographics and a vibrant economy,” said Bob Khalsa, president of the Santa Clarita Valley Division of the Southland Regional Association of Realtors. “The entertainment industry continues to expand locally, we’re the only place in L.A. County with significant new construction underway, plus, we’re the only city in the United States that has eight thriving business parks, with the ninth one approved.”
Because of the composition of the local community, surviving the full impact of the Great Recession, with the loss of income or loss of a job, it was somewhat easier for people to transition into other relatively well-paying positions, Khalsa said.
“Now, home prices are on the way up again with demand picking up even in homes priced above $800,000,” he said.
The median price of the 153 homes sold last month came in at $379,000, up 5.9 percent from a year ago for one of the highest numbers in two years. Home prices are up 11.5 percent from the record low of $340,000 set in November 2011.
The condominium median price of $220,000 was 13.4 percent ahead of 12 months ago and up 6.4 percent over January. It was the highest monthly median price since May 2011, and up 29.4 percent from the record low of $170,000 set in July 2012.
Neither Khalsa nor Jim Link, the Association’s chief executive officer, expect a dramatic change in the months ahead in the one statistic that is limiting the recovery — an exceedingly tight inventory.
“Pent-up demand combined with very active investors generate multiple offers on virtually every properly priced listing,” Link said. “Traditional buyers have difficulty competing with all-cash offers, especially when traditional financing remains limited and there are so few properties listed for sale.”
A record low 317 active listings were reported at the end of February, down 63.2 percent from a year ago. At the current pace of sales, that represents a 1.4-month supply; a 5- to 6-month supply would be considered balanced.
Listings peaked with a record high 2,630 listings in September 2006, and have been falling steadily ever since. A precipitous plunge in listings began a year ago February, with each of the last six months reporting drops from the prior year in excess of 60 percent.
“I don’t see listings picking up for a couple of years,” Khalsa said. “Partly because there are still so many underwater owners, but more so because we’ve had a sea change in homeownership in this country.
“Now we have a large number of homes owned by investors,” he said. “They don’t buy and sell the same as a traditional homeowner; they prefer a 1031-exchange to avoid capital gains tax. I don’t see investors just getting rid of the homes they’ve picked up today.”
Standard sales typically involving traditional homebuyers accounted for 48.4 percent of all transactions last month, according to Association statistics. Short sales, where the lender allows a sale for less than the outstanding loan balance, accounted for 36.2 percent of closed escrows. REOs, real estate owned properties that lenders typically acquire via foreclosure, represented 14.9 percent of total sales in the Santa Clarita Valley.
The Southland Regional Association of Realtors® is a local trade association with more than 9,000 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.