The Santa Clarita Valley boasts a strong, unique resale housing market that does not typically follow national or even some Southern California statistics and that’s a very good thing, indeed.
So good, in fact, that home and condo sales increased during 2011 while other Southern California communities still struggled to recover from the recession.
Local home sales during 2011 were up for the third time in four years, and condo sales rose during each of the last three years, the Southland Regional Association of Realtors reported recently.
Realtors negotiated sales of 2,135 single-family homes and 888 condominiums last year, posting a 2.6 percent increase for homes and 1.5 percent gain for condos.
Those annual sales generated more than $1.01 billion for the local economy, not including the purchase of related products and services that often follow each sale, such as appliances, remodeling and landscaping.
Realtors are a bit ahead on the economic-recovery curve because we have a vibrant community that attracts a lot of companies, has great schools and offers a lot of opportunity.
I like to say that Santa Clarita has the complete package; it’s a highly desirable place to live and work.
I think Realtors are on a good path this year in which Realtors will see resale prices level off and start a gradual climb as the number of foreclosures and short sales diminish, especially now that many lenders have restructured the short-sale process, making it easier and faster to get an answer and complete the transaction.
Luckily, Santa Clarita has been posting relatively strong numbers from the beginning of the recession and is on track for a faster recovery.
But don’t jump for joy; bank-owned properties will be with us through this year and possibly well into 2013, so there’s still plenty of work that needs to be done. Plus, the ongoing presence of owners whose property is worth less than what they owe will be a drag on the market.
“A sign that we’ve fully recovered will be when more conventional owners resume listing homes for sale,” said Jim Link, the CEO of the Southland Regional Association of Realtors. “That will signal owners’ renewed faith in the economy and the market, which will enlarge the number of properties listed for sale.”
Interestingly, unlike what’s happening elsewhere in the nation, where too many homes are on the market, we have the opposite problem — an exceedingly small local inventory, which limits buyers’ options and acts as a brake on sales.
That’s why even with today’s low interest rates on home loans and the best affordability in decades, sales have been relatively paltry.
The 961 properties listed for sale at the end of December fell 22.7 percent from a year ago and represent a mere three-month supply at the current pace of sales. A five- to six-month inventory is desired.
Soon, I expect the lack of inventory to put upward pressure on prices, which fell for the fifth consecutive year. The 2011 annual median price of $364,867 was down 10.2 percent over 2010.
The annual median price of the 888 condos sold in 2011 was $210,675, down 7.5 percent from the prior year. Except for a less than 1 percent increase in the median posted in 2010, the annual condo median has declined every year since 2007.
Don’t expect anything like the last boom, but prices have been bouncing along the bottom for some time now, and the trend is clearly up for 2012 and beyond.
Erika Kauzalrich-Bird is president of the Santa Clarita Valley Division of the Southland Regional Association of Realtors. David Walker, of Walker Associates, co-authors articles for SRAR. The column represents SRAR’s views and not necessarily those of The Signal. The column contains general information about the real estate market and is not intended to replace advice from your Realtor or other realty related professionals.