Housing market hits high

SCV home sales best in 11 years

Sales of existing homes in the Santa Clarita Valley hit an 11-year high in June.

And while summer is a typical home-buying season in the family-oriented community, other factors are driving up sales, according to local Realtors.

The 256 homes that sold last month constituted the highest number of homes sold in a single month since October 2005, when 280 homes traded owners, reported the Southland Regional Association of Realtors on Thursday.

By November 2005, the number of homes sold began an 11-year journey of declines, hitting the lowest point recorded in January 2008, when only 99 homes sold and the housing market was disintegrating under the weight of the economic recession. The realty group began tracking the numbers of homes sold locally in 1997.

“Santa Clarita sales are even stronger than expected for this time of year,” M. Dean Vincent, president of the association’s SCV Division, said in a statement.

Increasing sales

The number of homes sold in June was up 4.7 percent from the same period one year ago, and it jumped 5.2 percent over May.

Sales of condominiums soared in June when escrow closed on 127 condos – an increase of nearly 26 percent over the previous month, and up nearly 16 percent from a year ago.

The June condo sales total was the highest since August 2013, reported the realty association.

“I believe rising rental rates are pushing people out to look at purchasing versus renting,” said

Johnathan Frank with Keller Williams. “With interest rates at their current levels, many people are making the switch from being renters to homeowners because they are able to keep their payments at about the same.”

Supply stripped

In a case of demand exceeding supply, limited inventory is also pushing median prices up and generating another multiple-offers market. There were 60 fewer homes listed for sale in June than in the same period last year.

Buyers squeezed by a tight market have helped push home sale prices up.

Climbing to $575,000 in June, median prices were up 10.4 percent from a year ago.

It was also the highest median price since June 2007.

Multiple Offers

“The lack of inventory has led to multiple offers, fueling a greater demand,” said Alex Woltman, broker with Berkshire Hathaway. “I am currently in escrow with buyers who were competing with 10 offers. They got the home only because they removed the appraisal contingency.”

Connor MacIvor with ReMax agreed.

“It would seem that real estate has reached ‘critical mass,’” MacIvor said. “Desperate homebuyers (combined with) lacking

inventory created back pressure, and buyers who needed to buy bought.”

Buyers losing out on their homes of choice, due to multiple offers, resulted in very motivated homebuyers, he said.

Realtors also attribute the strong home sale market to low interest rates influencing sales, said Bob Khalsa, broker with United America Realty.

“Rates cannot continue at this all-time low,” said Erika Kauzlarich-Bird of ReMax. “And they’re also (adding) to multiple offers on homes.”

Those low rates also fueled the home buying frenzy – once again – last month.

Investors

“Over the last few months I have seen an increase in investors who are taking money out of the stock market and using those funds to purchase property to receive a better return on their investment,” Frank said. Those investors are also taking advantage of the rising rents in the area.

A couple of Realtors, however, also said they suspected another non-market factor driving home sales – election year.

“There is a level of uncertainty in an election year,” said Kauzlarich-Bird. “We will have a new president and who knows where our economy will go from there.”