Condominium sales rose even as the median price of condominiums sold during June in the San Fernando Valley came in at $420,000, which set a record high for the second consecutive month, the Southland Regional Association of REALTORS® reported on Monday, July 24.
The median was up 15.1 percent from a year ago and 0.2 percent above the prior record established in May of $419,000. Prior to May, the old condo record of $415,000 had been in place since February 2006.
“With single-family homes priced out of the reach of many families, there’s a madcap rush to grab any properly priced condominium,” said Nancy Starczyk, president of the Southland Regional Association of REALTORS®. “That translates into brisk sales with virtually constant upward pressure on prices, especially with today’s very tight inventory and barriers virtually everywhere that slow or prevent construction of more housing.”
The 257 condominiums sold during June represented the highest total since July 2007. Condo sales were up 27.2 percent from a year ago and 26.6 percent higher than this May, the Association reported. In a testament to the lack of inventory, the June tally was nonetheless 51.0 percent below the record high condo sales total of 524 sales set in July 2004.
REALTORS® also helped close escrow during June on 594 single-family homes. That was the highest monthly total in 12 months, but off 2.9percent from a year ago when 612 homes changed owners. Following seasonal patterns, home sales increased 6.8 percent from May.
The median price of single-family homes sold during June was $640,000, an increase of 6.7 percent from a year ago, but 4.7 percent below the record high of $671,500 set in March.
“It feels like we’re experiencing a perfect storm,” said Tim Johnson, the chief executive officer of the Association. “Many current owners would love to move, but they can’t find a replacement home, which limits what’s listed for sale. That process in itself puts upward pressure on prices, a cycle then exacerbated by a bevy of restrictions homebuilders bump into when they try to get new homes built.
“Sales activity seems concentrated in the price ranges from $600,000 and up,” Johnson said. “There are a dwindling number of buyers who can afford today’s prices, but in all prices ranges the tremendous lack of homes for sale is very problematic.”
The Southland Regional Association of REALTORS® reported 1,334 active listings at the end of June throughout the San Fernando Valley. That was off 20.0 percent from a year.
At the current pace of sales the June inventory represented a 1.6-month supply. That compares to the 30-year annual average inventory of a 5.9-month supply, which seems farfetched given current market conditions. June was the fourth consecutive month with the inventory below a 2.0-month supply.
After a year and a half of monthly increases in 2013 and 2014, the inventory has posted declines every month since February 2015. For comparison, the record high of 14,976 active listings occurred in July 1992.
Of the 851 combined residential transactions closed last month, 97.6 percent were standard sales involving traditional buyers and sellers. Only five foreclosure-related sales were reported, representing a 0.6 percent market share. There were also seven short sales, where the lender agreed to a sale price lower than the outstanding loan balance. That represented a 0.8 percent market share.
The Southland Regional Association of REALTORS® is a local trade association with more than 9,600 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.
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