San Fernando Valley home sales got 2016 off to a solid start with an increase of 9.8 percent compared with January 2015, the Southland Regional Association of Realtors reported on Thursday, Feb. 18.
Local Realtors helped close escrow on 337 single-family homes, up from the 307 transactions of a year ago. The sales total did drop from December activity, down, 31.8 percent, yet that is a typical seasonal decline.
Condominium sales fell 11.3 percent, primarily due to an extremely tight inventory and rising prices that with each tick up limit the number of people who can afford to buy. The condo sales tally was the lowest monthly condo total for any month since February 2008.
“Home and condo median prices appear to have hit a temporary plateau,” said Gina Uzunyan, president of the Southland Regional Association of Realtors. “Due to heavy demand and low inventory, prices will continue to rise through 2016, but, hopefully, at a lower, single-digit pace.”
The median price of single-family homes sold last month came in at $569,900, up 11.7 percent over January 2015. The condominium median price of $362,500 was up 10.2 percent from 2015.
Both appear to have hit their peak, with the home high of $600,000 reported in July, and the condo high of $370,000 set in August.
Both have recaptured most of what was lost in the market crash of last decade, though they remain below their respective record highs — the January median was 13.0 percent below its record high of $655,000 set in June 2007; while the condo median was 12.7 percent below the record peak of $415,000 of February 2006.
“Demand for homes and condos definitely is high, especially in the median price range and lower,” said Jim Link, the Association’s chief executive officer. “There are plenty of people who want to buy, who qualify for a mortgage, which are more available than a year ago, they have good credit histories, steady jobs, and significant savings for a downpayment.
“The wall they’re running into is the scarcity of homes or condos listed for sale,” Link said. “The supply is too short to meet this still burgeoning demand.”
The 1,262 active listings reported at the end of January throughout the San Fernando Valley were 13.1 percent below a year ago. That’s a 2.8-month supply in a market that needs a 6-month backlog or closer to 2,700 active listings. Of the 1,262 total, 941 were homes and 321 condominiums.
Distressed sales accounted for a total of 4.2 percent of the January market: 2.2 of which were foreclosure-related REOs and 1.0 percent short sales, where the lender agrees to a sale for less than the outstanding balance of the existing loan. January was the first month since the Association started keeping this statistic that there was only 1 condo short sale, yet another benchmark indicating distressed sales play little role in the current market.
Standard sales involving traditional buyers accounted for 94.7 percent of the local combined residential resale market.
The Southland Regional Association of Realtors® is a local trade association with more than 9,500 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.
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