Existing single-family home and condominium sales jumped off to a solid start during February throughout the San Fernando Valley, while median resale prices saw modest gains, the Southland Regional Association of Realtors reported on Monday, March 23.
A total of 345 homes changed owners, an increase of 7.8 percent over a year ago February and 12.4 percent ahead of this January.
Condominium closed escrows totaling 151 units were up 23.8 percent over a year ago and 13.5 percent higher than January.
“With interest rates still low, but likely to go higher later this year, and inventory up slightly, we’re seeing keen interest from prospective buyers,” said Gaye Rainey, president of the 9,100-member Southland Regional Association of Realtors.
With the heavier traffic at open houses there would have been more sales, she said, if more properties had been available. Nonetheless, local resale activity was heavier than in many other Southern California communities.
The inventory of properties listed for sale has shown some improvement over recent months, yet remains below desired levels. After hitting a 3.0-month supply in January, the inventory at the end of February came in at a 2.8-month supply based on the current pace of sales. A 6-month supply would foster a balanced market where neither buyers nor sellers held an advantage. There were 1,393 active listings at the end of February, down 1.8 percent from a year ago.
“The strong February numbers indicate that we’re moving into a market that should see slow, but steady improvement,” said Jim Link, the Association’s chief executive officer. “It’s a traditional market, with sales increasing in the Spring, more people listing their homes, especially now that almost all owners have equity, and modest increases in sales and prices.
“Recent reports that interest rates may increase mid-year may bring more buyers out,” Link said. “It also may prompt more owners to list now so that when they purchase a replacement residence they’ll capture low rates.”
The median price of the 345 homes sold last month came in at $525,000, up 10.5 percent over 12 months ago and 2.8 percent ahead of February. The local median remains 19.8 percent below the record high of $655,000 set in June 2007, but is up 54.9 percent from the record low of $339,000 that came in December 2011.
The condominium median price of $345,000 was the highest monthly median reported since the recovery started. It was up 12.8 percent over a year ago and 4.9 percent ahead of January. Since dipping to $185,000 in May 2009, the condominium median has increased 86.5 percent, yet is still 16.9 percent below its record high of $415,000 set in February 2006.
Link and Rainey said they hoped coming months would see more active listings, especially of the more affordable condominiums that are in heavy demand but short supply.
“Inventory remains low as some owners are waiting for additional hikes in equity, which may or may not appear,” Link said. “Plus, others are refinancing to gain low rates and using cash to upgrade homes or pay down debt.”
Distressed sales have receded to a point where they are nearly a non-factor or at pre-recession levels. Of the combined residential sales total of 496 closed escrows during February, 13 or 2.6 percent of the total were foreclosure related, 31 were short sales, or 6.3 percent of the market, and 450 were standards sales, 90.7 percent.
The local housing market, just like the broader economy, is improving, with pending sales—a measure of future home sale activity—posting positive numbers. There were 771 open escrows throughout the San Fernando Valley at the end of February. That was up 22.4 percent over a year ago.
The Southland Regional Association of Realtors® is a local trade association with more than 9,100 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.
- 30 -