Santa Clarita Valley Single-Family Homes and Condominium Resale Statistics

Santa Clarita Valley's balanced residential resale market frustrates home buyers expecting to snag deep discounts

The steady, consistent pace of the current residential housing market in the Santa Clarita Valley is frustrating prospective home buyers who falsely presume that fewer sales necessarily translates into greatly reduced resale prices, the Southland Regional Association of Realtors reported on Thursday, June 28.

The number of homes sold throughout the Santa Clarita Valley during May continued to hover 23.5 percent below the level of activity reported a year ago while prices remained flat or showed only modest declines.

A total of 179 single-family homes closed escrow during May, 23.5 percent below a year ago, but up 2.9 percent from April of this year.

Realtors also guided 90 condominiums into the hands of new owners, a total that was 26.8 percent lower than May 2006, but up 18.4 percent from this April.

"Buyers hear reports that sales are down from record levels or that some homes are in foreclosure and conclude that sellers and lenders are giving away properties, but that's just not the case," said Larry Gasinski, president of the Association's Santa Clarita Valley Division.

"If a home doesn't sell quickly owners and banks eventually offer incentives, but there are no huge bargains out there like there were during the early to mid-1990s," Gasinski said. "Other buyers are still sitting on the sidelines waiting to see what happens, yet any advantage gained in price has already been offset by slightly higher and still rising interest rates."

Gasinski and Jim Link, the Association's executive vice president, noted that buyers also incorrectly believe that the number of homes listed for sale has given all the negotiating advantage to buyers.

It's true that the inventory does favor buyers slightly more than sellers - a welcome relief after years of sellers being in control. However, the 2,240 active listings throughout the Santa Clarita Valley were up only 7.2 percent from a year ago and 3.7 percent higher than this April.

At the current pace of sales, Link said, the inventory represents an 8.3-month supply - just above the 5- to 6-month inventory that represents a balanced market where neither buyers nor sellers wield an advantage. A true buyers' market, like during the 1990s, would have a supply that exceeded a 16- or 18-month supply.

Just as Realtors strive to re-educate buyers, Gasinski and Link said Realtors report that sellers also sometimes make ill-informed choices that too often ruin the chance of a speedy sale.
"We hear it all the time from Realtors that even though sellers know the market has slowed down sellers insist on listing a home at a high price thinking they can reduce it later," Gasinski said. "Instead, what happens is that the homes do not even get shown because they are out of the price ranges of what people want to pay."

The median price of the single-family homes sold last month was $615,000, down 2.2 percent from a year ago, but up 3.4 percent from this April. Since the record high of $643,000 was set in April 2006, the median price has been hovering between $570,000 and $615,000.

The condominium median price of $355,000 was 9.4 percent below a year ago and down 7.8 percent on a month-to-month basis. The record high of $397,000 was set in January of 2006.
"The market is definitely shifting in favor of buyers," Link said, "but not in the sense of prices dropping dramatically.

"Buyers have a wider choice and more time now to consider their options," he said, "but if a property is listed correctly at the current market price, buyers will be sorely disappointed and miss an opportunity if they are looking for a 20 or 30 percent discount. It simply is not happening."

Courtesy: Southland Regional Associaiton of REALTORS