Fueled by heavy demand and low interest rates, sales of existing single-family homes during June in the San Fernando Valley hit the highest mark in four years.
The Southland Regional Association of Realtors Thursday, July 28, reported that 612 homes changed owners during June, up 6.3 percent from a year ago and 17.5 percent higher than this May.
“These are the typically busy months of the year, yet this summer even more people are hunting for a home,” said Gina Uzunyan, president of the Southland Regional Association of Realtors. “Recent drops in the interest rate on home loans have brought buyers out in force.
“Sales would be considerably higher,” Uzunyan said, “if only there were more homes listed for sale.”
The 1,668 active listings reported throughout the San Fernando Valley were down 6.9 percent from a year ago. At the current pace of sales, that represents a mere 2.0-month supply, down from the 2.3-month inventory of June 2015.
For comparison, when the market crashed in 2007, inventory averaged a 9.2-month supply. But in the face of unrelenting demand today’s inventory has stayed at or below a 2-month supply with only five months at or higher than a 3.0-month backlog.
The lack of inventory, especially in entry-level price ranges, impacted condominium sales, with the 202 sales of June down 38 percent from the prior year.
While resale prices continue to rise, the increases are much more gradual, buyers much more selective, and market forces more likely to stall or stop the sale of properties deemed to be overpriced.
Uzunyan and Jim Link, the Association’s chief executive officer, agreed that in this market if a property fails to sell in short order it almost certainly is priced too high or has fatal flaws.
“Luckily, appraisers are holding the line on prices, realizing they still have to justify a sale price,” Link said. “Appraisers are not allowing a bidding war to overly influence appraisals.”
The median price of the 612 homes that changed owners last month came in at $600,000. That was up 6.8 percent from a year ago, yet below the median of $610,000 reported in April, which was the highest since the recovery began. The June median was 8.4 percent below the record high of $655,000 set in June 2007.
The median price of condominiums sold during June was $365,000, up 3.7 percent from June 2015 and 2.0 percent higher than this May. The condo median peaked this March at $382,000. The record high condo median came in February 2006 at $415,000.
Of the 814 total residential transactions consummated by Realtors last month, 94.0 percent were traditional sales. Twenty-two transactions, or 2.7 percent, were foreclosure related sales, while 19 were short payoffs or 2.3 percent of the total.
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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