Sales of existing single-family homes during July in the Santa Clarita Valley hit the highest total since March 2007, the Southland Regional Association of Realtors reported this week.
Realtors helped close escrow on 255 homes, up 20.3 percent over a year ago and the second consecutive month above the 250-sales benchmark.
Similarly, condominium closed escrows totaled 119 during July, up 22.7 percent. It was the third consecutive month condo sales exceeded 100. The condo sales total was the highest since August 2013.
“Home sales typically stay busy every summer at least until schools open,” said Bob Khalsa, president of the Santa Clarita Valley Division of the Southland Regional Association of Realtors. “The market is bustling, as expected, and probably will remain active for months to come, especially as prospective buyers try to secure loans at today’s low interest rates.”
Khalsa urged buyers who may be procrastinating to “get moving because interest rates will start to go up.
“There won’t be a wild swing and increases probably will be moderate,” he said, “yet every single indicator points to interest rates moving higher sometime soon.”
The median price of the 255 homes sold during July came in at $509,500, up 9.5 percent over a year ago, yet 2.2 percent below the June median price. The highest median reported so far in this recovery was in May at $530,000.
The median price of condominiums sold last month hit its highest figure since December 2007. The July condo median of $330,000 was up 15.8 percent over a year ago and rose 4.8 percent above this June.
“Home resale prices have been steadily moving higher, yet as affordability becomes an issue for many buyers, the increases are much more moderate,” said Jim Link, the Association’s chief executive officer. “The market is healthy and we’d be posting more activity if only there were more properties listed for sale.”
There were 689 active listings at the end of the month, off 5.1 percent from a year ago. At the current pace of sales the inventory represents a 1.8-month supply compared to last July’s 2.3-month inventory. To achieve some balance, the local market needs a 6- month supply, or closer to 2,200 active listings.
The limited supply combined with the large pool of prospective buyers, even at today’s higher resale prices, push prices higher.
“Between higher prices, the need for a substantial down payment requirement, and still too-tight lending standards, the pool of buyers is beginning to shrink,” Link said. “The real issue comes down to this—you still need to qualify for a loan.”
Nonetheless, pending escrows—a measure of future sales activity—suggests the market will stay active for months to come. There were 396 open escrows at the end of the month, up 14.5 percent over July 2014.
While just short of record numbers, distressed sales played a diminished role during July. There were three foreclosure-related sales throughout Santa Clarita during July, which represented 0.8 percent of the total market. There also were 13 short sales, where lenders agree to a sale price lower than what is owed on the existing loan. That captured a 3.5 percent market share.
Traditional buyers, or standard sales, accounted for 94.4 percent or 353 of the total 374 transactions, with five sales not specifying the sale by type.
The Southland Regional Association of Realtors is a local trade association with more than 9,100 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.