The residential real estate market in the Santa Clarita during November went against seasonal trends as condominium sales rose 4.5 percent and the supply of properties listed for sale fell for the fifth consecutive month, the Southland Regional Association of Realtors reported Tuesday.
The lowest interest rates on home loans in three years brought buyers out at a time of year when activity typically tapers off.
That yielded 70 sales of local condominiums and 176 single-family home sales, which were off 6.4 percent compared to November 2018.
“As of mid-October, obtaining an FHA backed loan got a little easier, which may have translated into the bump in condo sales,” said Amanda Etcheverry, the 2019 chair of the Santa Clarita Valley Division of the Southland Regional Association of Realtors. “The new condo rules, among several significant changes, made it possible for individual condominiums to obtain loan approval even if the condo association was not FHA approved.”
“I truly believe there would have been more sales of homes and condos if only the inventory had been larger,” she said.
At the end of November, the Association reported a total of 377 active listings. That was down 37.5 percent from a year ago, and the first time in 20 months that the local supply fell below the 400-listing benchmark.
For comparison, the record low listing total was 312 listings in March 2013 while the record high of 2,630 listings was reported in September 2006.
At the current pace of sales, the 377 listings represented a 1.5-month supply. The average listing total reported over the past 11 years was a 4.1-month supply.
“Low interest rates help offset some of the impact of rising prices,” said Tim Johnson, the Association’s chief executive officer. “But Realtors believe more homes and rental units must be built or the affordability crisis will only worsen with each passing year.”
The median price of the 176 single-family homes that changed owners came in at $625,000, which was up 11.6 percent from a year and 2.5 percent higher than the October median. The median price is the number where half the sales are lower and half are higher.
The local home median price has been on a steady ascent since hitting the record low of $340,000 in November 2011 as a result of the Great Recession. Yet unlike most other regions in Southern California, it has yet to surpass the record high of $643,000 set in April 2006.
Condominium prices offer a different story: the November condominium median price of $415,000, while up 6.4 percent from November 2018, was down 1.2 percent from this October, which saw the median price repeat the record high of $420,000 that was first reported in August.
Low interest rates appear to be fueling an atypical surge in sales for this time of year. Pending escrows, a measure of future sales, were up 12.4 percent from a year ago with 245 open escrows reported at the end of the month.
Even with high prices, the Association’s “Income-to-Loan Guide” showed a 5.0 percent drop in the minimum income needed to qualify for an 80 percent loan on a local median-priced condo of $415,000. The national average interest rate of 3.70 percent was so low that it offset some of the impact of high prices.
A total income of $83,674 qualified for a loan of $332,000, which yielded a monthly payment of $2,092 for principal, interest, insurance, and property taxes.
A year ago, when the median price was $390,000, an 80 percent loan carried an average interest rate of 4.99 percent and a monthly payment of $2,203.
The Southland Regional Association of Realtors is a local trade association with more than 10,300 members serving the San Fernando and Santa Clarita Valleys. SRAR is one of the largest local associations in the nation.
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