Santa Clarita Real Estate News

Santa Clarita Homes Sales Up During February

Residential resale activity in the Santa Clarita Valley increased 16.2 percent during February compared to January even as the number of homes sold lagged behind the figure reported a year ago, the Southland Regional Association of Realtors® reported. A total of 1 15 single-family homes closed escrow during February. That was 60 transactions lower than February 2007, down 34.3 percent, but 16.2 percent higher than the 99 transactions that closed escrow this January.

The difference between numbers reported a year ago is high, but appears to be slowing dropping. Declines of 43.8 percent and 42.4 percent were reported in December and January, respectively.

"Business has definitely picked up compared to December and January," said Doreen Chastain-Shine, president of the Association's Santa Clarita Valley Division. ‘We're seeing more interest from buyers and more transactions going into escrow.

"Maybe it's the effect of lower prices and attractive interest rates combined with the higher limit on conforming loans and action by the federal government," she said, "but for the last three or four weeks, something has been happening."

Condominium sales during February reflected the same pattern as single-family homes. A total of 37 condos closed escrows during February, down 58.0 percent below a year ago.

However, the total was an improvement - up 19.4 percent - from the record low of 31 sales set this January.

Pending escrows - a reliable measure of future resale activity - were down 30.4 percent from a year ago, but increased 25.1 percent on a month-to-month basis.

"It's too soon to say with any certainty that we've hit bottom, but it is encouraging to see that buyers are returning to the market," said Jim Link, the Association's executive vice president. "Initial offers may come in quite a bit lower than the list price, but what's important is that there is an offer on the table.

"Negotiations cannot begin unless buyers are willing to take the first step," Link said, "and it appears that a growing number of buyers believe that now is the time to act."

Even the median price of single-family homes and condos that closed escrow during February reflected a similar pattern - a drop from year-ago levels, but an increase from the prior month.

The median price of the 1 15 homes that closed escrow was $490,000, down 14.0 from a year ago, but up 6.5 percent from the January figure. The record high of $643,000 was set in April of 2006.

The median price of the 37 condos that changed owners was $309,000, down 14.6 percent from a year, but up 8.5 percent compared to the January median. The condo record high of $397,000 was set in January 2006.

A total of 2,182 properties were listed for sale on the MLS at the end of February. That was up a modest 3.6 percent from a year ago.

"Some sellers still cling to an out-dated mentality when it comes to pricing, hoping to snag the sky-high prices that were common at the height of the housing boom," Chastain-Shine said.

"Now more owners, especially those who have been in their homes for a while and have appreciable equity, realize that price is less important than completing a sale, " she said. "Only after they sell their current home can they change roles to become a buyer and reap the benefits of the today's buyers' market. They may take a lower price when they sell, but then they'll be in a position to get the same price break when they buy, so in the end it evens out."

The inventory of existing homes listed for sale throughout the Santa Clarita Valley indicates that the market clearly favors buyers, however, the supply is not nearly as high as some buyers believe. The active inventory at the end of February stood at 2,183 units, up 3.6 percent from a year ago and less than 1 percent ahead of January.

At the current pace of sales the inventory represents a 14.4-month supply, which clearly indicates a buyers' market considering that a balanced market is believed to be in the range of a 5- or 6-month supply.

Statistics are not available to support the conclusion, but real estate experts believe today's inventory is still considerably lower than the backlog of unsold home - believed to be in excess of a 20-month supply - that existed during the national recession of the early 1990s.