July home sales fueled by lowest rates in years

Santa Clarita Valley Business Journal
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A total of 263 single-family homes changed owners during July, an increase of 22.3% from a year ago and the highest monthly total since June 2018, the Southland Regional Association of Realtors reported.

The total was up 11% from June, and reflected the fact that interest rates on home loans are at their lowest point in more than three years. “Buyers know that rates have been low for months,” said Amanda Etcheverry, the 2019 chair of the Santa Clarita Valley Division of the Southland Regional Association of Realtors. “What’s remarkable is that they appear to be holding steady and in recent weeks dipped even lower, offering buyers an unprecedented window of opportunity. “The low rates offset some of the impact of prices that have risen to a point where affordability concerns complicate most sales and shrink the pool of prospective buyers at nearly every price point,” she said.

 Condominium sales totaled 81 during July, down 10% percent from a year ago, yet up 11% from this June. The median price of condos that changed owners last month came in at $409,500, up 8% from July 2018, yet below the record high of $415,000 that was set this June.

The single-family median price — meaning half sold for more and half for less — was $630,000. That was up 5% from July 2018, yet was 2% below the record high of $643,000, which came in April 2006. “Good thing low interest rates are giving buyers a strong incentive,” said Tim Johnson, the association’s chief executive officer, “because the local inventory has tightened again after showing signs earlier this year it might grow.”

July was the first month to show a drop in the inventory after 13 consecutive monthly increases compared to the prior year. A total of 606 homes and condominiums were listed for sale at the end of July, down 9.8% from a year ago.

At the current pace of sales, that total represented a 1.8-month supply, the lowest supply since June 2018. Pending escrows — a measure of future activity — totaled 357, up 15.9% from a year ago. With a limited inventory, it’s not surprising that there have been few distressed sales. There were zero condominium distressed sales during July and only two foreclosure-related transactions involving single-family homes. Fully 97.7% of the combined 344 transactions were standard sales involving traditional buyers and sellers.

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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