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SCV’s January home sales slow

Posted: February 26, 2014 3:22 p.m.
Updated: February 26, 2014 3:22 p.m.

Following a statewide trend, sales of existing Santa Clarita homes slowed in January, according to numbers released by the Southland Regional Association of Realtors on Wednesday.

Experts pointed to the tighter lending rules that took effect in January, as well as a lack of affordable homes.

Nearly 83 percent of all local sales came from homeowners with equity in their homes.

“Investors played a big part of our market last year, but in mostly short sale opportunities. As we saw a decrease in short sales, the return on investment has decreased,” said Cherrie Brown of HomeSmart.

Distressed sales — where lenders accept a sale price lower than is owed on the property — only represented 16.2 percent of the market in 2014, down from 52.1 percent of the market a year ago.

“We are still riding the 16-22 percent increase in prices that we observed between February 2012 and October 2013,” said Connor MacIvor with Remax. “Buyers that did not or were not able to buy in 2012 and 2013 are not too excited about the increase in prices and many have been ‘priced out’ as a result in the current market.”

While home sales in the Santa Clarita Valley were the slowest since 2008, median prices were just $27,000 shy of the prices recorded when the market crashed that year.

The realty association reported the sale of 138 local homes in January and a median price of $432,900.
Still, existing home sales dropped 7.4 percent from a year ago.

Condominium sales, however, shot up 10.2 percent over January 2013. They were the strongest since 2007, with a recorded sale of 65 condos and a median price of $250,000. Prices were the most robust as well since 2008.

“We’re definitely in a transition phase where buyers and sellers are coming to grips with today’s housing resale market,” said Nancy Starczyck, president of the Santa Clarita Valley Division of the Southland Regional Association of Realtors.

“I expect people to have an improved perspective with enough confidence to jump into the market as busy spring and summer home buying seasons get under way.

“Today’s market is dramatically different from even mid-2013,” Starczyk said. “There are only seven homes currently listed that are priced under $350,000. Buyers will find more condos and townhomes for sale, yet the total inventory is pretty bare bones.”

There were 496 active listings throughout the Santa Clarita Valley on the association’s Multiple Listing Service at the end of January.

“I think our inventory is still too low and sellers with equity are slowing coming on the market,” said Kathy Salisbury with Triple D Realty.

Also, tighter lending is forcing some buyers into FHA financing, which has Private Mortgage Insurance — a monthly fee that can add to a payment and that’s factoring into what a home buyer can afford, she said.

“Lower sales results from a combination of seasonal forces, dropping affordability and tightened underwriting for home loans, but today’s miniscule inventory could well be the biggest factor,” said Jim Link, the association’s chief executive officer.

“It’s a good, healthy thing to see standard sales rise as investors and distressed sales depart, although traditional sellers have yet to fill the void.

“That will begin to correct itself in the months ahead,” Link said, “especially as home sellers gain greater confidence in the economy.”

MacIvor predicts that 2014 is going to be the year for the move-up or seasoned buyer.

“First-time buyers are going to continue to save money, and hopefully enough real estate inventory will come onto the market to switch it from a sellers’ to a buyers’ market,” MacIvor said.

At the current pace of sales, the inventory represents a 2.4-month supply. To hit the desired six-month supply, where neither the buyer nor seller has an advantage, the region would need 1,220 active listings.



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