While showing signs of a seasonal slowdown, the housing market in the San Fernando Valley stayed busier than expected during October with the 523 single-family home sales up 5.9 percent over a year ago, the Southland Regional Association of Realtors reported on Wednesday, Nov. 25.
With activity typically tapering off as holidays approach, the October total was down 10.1 percent from this September. The local home resale market hit its peak in July with 603 closed escrows.
Realtors also facilitated 209 condominium sales last month, up 37.5 percent over a year ago and 1.0 percent higher than this September. The total was one sale shy of the 210 sales posted in June, which was the highest condominium tally since July 2013.
“Improvement in the jobs market has yielded added interest in home buying,” said Gaye Rainey, president of the Southland Regional Association of Realtors. “Yet added interest by buyers comes with a still-too-tight inventory and higher resale prices, which makes it difficult for some buyers to qualify for a home loan, even as interest rates remain exceptionally low.”
The single-family median price of $562,000 was 7.9 percent higher than October 2014 and 1.3 percent ahead of this September. Since hitting $600,000 in July for the first times since 2007, the median has been hovering below that benchmark, partly because of resistance from buyers.
The condominium median resale price of $369,0009 was up 16.4 percent over a year ago and 6.6 percent ahead of the September median price. It was just short of the $370,000 high set in August, which was the highest since November 2007.
“No doubt affordability is as big a factor as the limited supply of homes listed for sale,” said Jim Link, the Association’s chief executive officer. “There are fewer instances of multiple buyers competing for quality properties, which eases the upward pressure on prices.”
The inventory of homes listed for sale continued to shrink with the 1,659 active listings throughout the San Fernando Valley down 10.2 percent compared to a year ago. At the current pace of sales, that represents a 2.3-month supply when what the market really needs is a 6-month supply to achieve some balance.
Pending sales, a measure of future sales activity, were up 4.2 percent over a year ago, which suggests activity will continue to be stronger than expected as the year draws to a close.
Distressed sales are holding only a small share of the market, the Association reported. Of the total 732 combined residential closed escrows last month, 93.0 percent were standard sales involving traditional buyers and sellers. Foreclosure-related REO sales came in at 3.0 percent while short payoffs, where the lender agrees to a sale price less than the outstanding loan balance, fell to 2.6 percent.
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.