Santa Clarita Real Estate News

Santa Clarita Valley home Sales Up 22%

Sales of existing single-family homes increased 22.2 percent throughout the Santa Clarita Valley during July with the 237 closed escrows up 43 transactions from the 194 total of a year ago, the Southland Regional Association of Realtors^® reported.

Home sales increased on a month-to-month basis for the sixth consecutive month, rising 3.5 percent in July compared to June.

Condominium sales also increased, rising 2.4 percent for a total of 85 closed escrows, two sales higher than a year ago and 10 sales ahead or 13.3 higher than this June.

The waiting is over," said Doreen Chastain-Shine, president of the Association's Santa Clarita Valley Division. "Buyers realize that the market is not going to get any better and if they fail to buy a home now an incredible opportunity will be behind them."

While the market will not return to normal until foreclosed properties and so-called "short sales" work their way through the system, statistics released by the Southland Regional Association of Realtors indicate that the market has changed direction.

In a growing number of instances, Realtors across the valley report, multiple offers have reappeared as people strive to capture homes that sold at much higher prices just a short while ago. Chastain-Shine said that one property listed at $450,000 recently attracted 32 purchase offer.

Most of the activity is concentrated on homes listed for less than $500,000, she said, which has the effect of pulling the overall median price lower.

The median price of single-family homes sold last month was $441,000, down 22.6 percent from a year ago, well below the record high of $643,000 set in April 2006. The median has been sliding on a consistent basis since then and its drop has accelerated as buyers focus on entry-level-priced housing.

The condo median price of $285,000 was down 20.8 percent from a year ago and unchanged on a month-to-month basis. While still above 20 percent, the decline in the median price for both single-family homes and condos appears to be slowing as sales activity begins to pick up.

"Prices should solidify as foreclosures and distressed properties find buyers," said Jim Link, the Association's chief executive officer. "But the sales numbers clearly suggest that we've bottomed out and that sales are on the upswing."

That perspective was bolstered by statistics reporting pending escrows - a measure of future sales activity. The number of open escrows at the end of July increased 33.9 percent compared to a year ago and gained 3.5 percent over this June.

While higher than during the sellers' boom market, the inventory of homes currently listed for sale is not excessive, despite the public's inaccurate perception that there is a vast backlog of homes for sale.

There were 1,722 active listings throughout the Santa Clarita Valley at the end of July, down 24.6 percent from a year ago and 8.4 percent lower than this June, the Association reported. Of that total, 73 percent of the listings were single-family homes.

At the current pace of sales, the inventory represents a 5.5-month supply. Industry experts believe a balanced market - where neither buyer nor seller hold sway - appears when there is a 5- to 6-month supply.

The mismatch between the public's view and reality often leads to fruitless negotiations as buyers think sellers must accept ridiculously low purchase offers.

"Realtors need to educate buyers before they even get in the car to go look at a property," Chastain-Shine said. "Buyers think they can negotiate with the bank on a foreclosed property, but there really is very little room for negotiations when you have a financial institution struggling to recover money invested in a property."

Chastain-Shine also said that professional representation, especially when negotiating with a bank, is more vital than ever. Completing a purchase successfully today requires market knowledge and experience on the part of the Realtor and a realistic, informed view regarding prices on the part of the buyer.

"There is very little chance that someone will be able to complete a purchase without a Realtor," she said. "Banks simply will not talk with an individual, so be sure to select a Realtor who is qualified in the area, who knows about foreclosures, trends and price discounts over the last year. Then go with your Realtor's advice."