In a pattern repeated in many communities statewide, closed escrows during August of existing homes and condominiums in the San Fernando Valley posted hefty increases compared to a year ago with homes changing owners up 15.8 percent and condominium sales rising 30.3 percent, the Southland Regional Association of REALTORS® reported Wednesday, Sept. 20.
A total of 631 single-family homes closed escrow last month, up 86 transactions from August 2016 and 145 transactions or 29.8 percent higher than the July tally. That was the highest number of closed escrows for any month since October 2012.
Similarly, REALTORS® helped close escrow on 262 condominium sales during August, up 61 transactions or 30.3 percent over the prior year and 72 sales or 37.9 percent ahead of this July.
“Not surprisingly, given today’s rising resale prices, homes priced from $450,000 to $800,000 saw the heaviest activity, though higher price ranges also saw more activity than a year ago,” said Nancy Starczyk, president of the 9,800-member Southland Regional Association of REALTORS®.
“Fluctuations in interest rates may have pushed some buyers off the fence,” Starczyk said, “though I believe few buyers are deterred by rising rates. Those in a position to buy know rates may rise, inventory is tight, and that economists predict today’s gradual price increases will continue for the next two years, making quick action wise.”
The 631 homes that closed escrow in August had a median price of $650,000. That was 4.0 percent higher than a year ago, but 3.2 percent below the record high of $671,500 set this March. The home median price — meaning half the sales were lower and half higher — has been above $600,000 every month this year, a feat unmatched since 2007, which was the peak of last decade’s housing boom.
Condominiums that closed escrow last month also posted single-digit increases compared to a year ago August. The condominium median price of $411,500 was up 6.9 percent. August was the fourth consecutive month and the fifth so far this year to post a median price above the $400,000 benchmark. The August median was 2.0 percent lower than the record high $420,000 reported this June.
“Too many buyers chasing too few properties listed for sale clearly are driving the increases in resale prices.” said Tim Johnson, the Association’s chief executive officer. “That trend likely will continue for the foreseeable future.
“It’s risky to speculate as to why sales spiked, what with multiple forces contributing to buyers’ sense of urgency,” he said. “Regardless, the local increase in sales appears consistent with what’s happening statewide.”
The Association reported that there were 1,372 active listings at the end of the month. That was down 18.9 percent from August 2016. At the current pace of sales, that represents a 1.5-month supply. A year ago, it was a 2.3-month supply.
The local inventory of homes and condos listed for sale has posted double-digit declines compared to the prior year for seven consecutive months. Every month since January 2015 has posted a decline in inventory — a downturn that came on the heels of 19 consecutive months of increases. While well below the record high, the boom of last decade peaked with 7,730 active listings in October 2007.
In a measure of future sales activity, REALTORS® opened 849 escrows during August. That was up 0.4 percent or three sales from a year ago.
Of the 839 combined residential sales reported last month, 860 or 96.3 percent were standard sales. There were 11 foreclosure-related transactions, for a 1.2 percent of the August market, and eight short sales, representing 0.9 percent of escrows.
The Southland Regional Association of REALTORS® is a local trade association with more than 9,800 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.
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