The median price of single-family homes sold throughout the San Fernando Valley during August came in at $625,000 — the highest median price since 2007, the Southland Regional Association of Realtors reported on Thursday, Sept. 15.
That was up 7.8 percent over a year ago and brought the median just 4.6 percent below the record high of $655,000 set in June 2007. The median keeps inching higher even as sales taper off due to a limited inventory and a shrinking pool of buyers who can afford to buy.
“While buyers jump on any entry level property that is priced affordably, most other price ranges appear to have stalled,” said Gina Uzunyan, president of the 9,500-member Southland Regional Association of Realtors. “I’m hearing complaints from Realtors that some sales are being slowed by the complicated dynamics of new disclosure rules, making it difficult to close a transaction.
“Personally, I’ve had buyers tell me they are temporarily pulling out of the market until after the presidential elections,” Uzunyan said. “They want to see what happens, which may be another reason why we’re not seeing as many multiple offers.”
The median price of condominiums sold last month in the Valley came in at $385,000, up 4.1 percent over a year ago, but off 3.0 percent from July, which saw the highest median price since July 2007. The August condo median price was 7.2 percent below the record high of $415,000 set February 2006.
“The days of 1,000 or 1,500 closed escrows per month are gone,” said Jim Link, the Association’s chief executive officer. “The market is drifting in the doldrums. Low interest rates and pent-up demand keep sales going, but as prices go higher and inventory stays short, we’ll get an even tighter market.
“Owners who want to sell are happy and plenty of buyers are still interested,” he said, “yet current market dynamics and the local economy are unlikely to change in the near future.”
The Association reported a total of 545 single-family closed escrows during August in the San Fernando Valley. That was down 5.5 percent from a year ago. June was the high point of the year with 612 home sales, which was the highest total since October 2012.
Reflecting demand in entry-level price ranges, condominium sales picked up last month, increasing 6.9 percent to 201 closed escrows compared to August 2015. Condo sales increased 12.3 percent from this July.
For comparison, at the peak of last decade’s boom market 1,321 homes closed escrow in August 2003 while 524 condominiums changed owners in July 2004. The record high home sales total of 1,648 was set in August 1988.
There were 1,691 active listings at the end of August, down 9.0 percent from a year ago. At the current pace of sales that represents a 2.3-month supply. Since 2012, inventory has stayed at or below a 2-month supply with only five months at or above a 3.0-month backlog.
Realtors reported a total of 846 pending escrows, which are an indicator of future sales activity. That was down 4.3 percent form a year ago.
Of the 746 total combined residential transactions consummated by Realtors last month, 94.9 percent were traditional sales; 19 sales, or 2.5 percent of the total, were foreclosure related; and 12 transactions or 1.6 percent, were short payoffs.
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.