The median price of homes sold during June in the San Fernando Valley hit an eight-year high, although price gains appear to be leveling off as the market adjusts to the absence of bargain properties, the Southland Regional Association of Realtors reported Wednesday, July 23.
The single-family median price of homes that closed escrow during June hit $536,000, up 5.6 percent over a year ago for the highest median price since December 2006. After registering only minor gains from 2010 to 2012, the single-family median has been rising steadily since late 2012, although the increases now are single digit compared to the double-digit gains of recent years.
For the third time this year, the median price of condominiums that changed owners during June came in at $325,000, up 1.6 percent over a year ago and unchanged from the May 2014 median price. The condo median went as high as $335,000 in August 2013, yet has been stuck below that number ever since.
"Price gains are slowing and sales are flat for a myriad of reasons", said Roger Hance, president of the association. "Foremost is the fact that the so-called ‘bargain’ properties that attracted investors and all-cash buyers post-recession are gone; and second is the fact that higher prices limits affordability fortraditional buyers."
A total of 1,808 properties were listed for sale on the Multiple Listing Service operated by the Association. That was up 36.0 percent from a year ago. At the June pace of sales, the inventory represents a 2.6-month supply. A year ago the inventory was a 1.7-month supply, with a 6-month supply regarded as balanced.
“Steady increases in the inventory signal that owners understand and accept today’s market dynamics,” said Jim Link, the Association’s chief executive officer. “This market might just be the new normal, if there is such a thing.”
A total of 525 single-family homes closed escrow during June, off 19 sales or 3.5 percent from a year ago. Sales increased slightly from May, up nine transactions or 0.6 percent. It was the second lowest tally for the month, a mere one sale ahead of the record June low of 524 home sales registered in June 2012. Nonetheless, the June total was up 64.1 percent from the all-time record low of 320 sales set this February.
Condominium sales came in with 176 closed escrows during June, down 22.8 percent from a year ago and off 4.9 percent from this May. It was the lowest condo total on record for the month of June, but up 67.6 percent from the 105 sale record low of January 2008.
Distressed sales fell again during June with standard sales rising to a record high of 89.2 percent of total residential resale activity. Short sales fell to a record-low 7.0 percent and foreclosures came in at 3.0 percent, up slightly from the 2.8 percent reported this May.
The Southland Regional Association of Realtors® is a local trade association with more than 8,900 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.