Record high resale prices during 2018 combined with rising interest rates to reduce the pool of prospective buyers, triggering a drop in home and condominium sales, but also yielding the first increase in three years ofn Friday, Jan. 25.
Members of the Association represented buyers and sellers in 7,154 property transactions during 2018 — 5,323 single-family homes and 1,831 condominiums. That was down 11.0 percent from 2017 when 5,908 properties closed escrow throughout the San Fernando Valley.
REALTOR® -managed transactions last year generated nearly $5.6 billion for the local economy, not including the millions more in landscaping, appliance sales, remodeling, and other home-purchase related activities that typically accompany a sale. The total was up 14.3 percent from 2017 when total sales generated $4.9 billion in closed escrows.
“Prices are too high, interest rates, while still favorable, have risen, and there still are not enough properties listed for sale, but, believe it or not,” said Dan Tresierras, president of the 10,300-member Southland Regional Association of REALTORS®, “that means there are more opportunities out there for eager buyers.
“Some people say they’re waiting, hoping prices will fall,” Tresierras said. “Others, who really want a home now, realize they may have an advantage because less competition means fewer multiple offers, which may prompt eager sellers to negotiate while keeping high-price expectations in check.”
After three years of a steadily dwindling inventory, the number of homes and condominiums listed for sale each month of 2018 averaged 1,296 active listings. That was up 7.4 percent from 2017 when listings averaged a record low 1,207 per month. That compares to an average 6,633 per month in 2007 and the record-high monthly average of 13,300 listings in 1992.
“With few storm clouds on the horizon, 2019 will see activity similar to 2018 with limited sales, and little or limited price appreciation,” said Tim Johnson, the Association’s chief executive officer.
“We’ve hit a point where there may be downward pressure on prices,” he said, “as the market shifts to the middle in an effort to regain buyers who have been priced out.”
The annual median price of single-family homes that changed owners last year was $680,958, up 5.8 percent over 2017 for the seventh consecutive annual increase and a record high.
Similarly, the condominiums sold in 2018 also set a record at $430,667, up 4.9 percent and also the seventh consecutive increase.
REALTORS® assisted the close of escrow on 5,363 homes, down 9.4 percent from 2017 for the lowest annual sales total since SRAR began keeping this statistic in 1985.
Annual condominium sales fell 19.1 percent from 2017 to 1,849 units.
“Since 2014,” Johnson said, “condo sales have been on again/off again, with one year up and the next year down.”
The year ended with December home sales off 9 percent and condo sales down 19 percent from December 2017. Homes sold during December had a median price of $669,000, an increase of 3.7 percent from the prior year, while the condominium median price of $425,000 was down 1.2 percent.
The Southland Regional Association of REALTORS® is a local trade association with more than 10,300 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.
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