Home Resales Continue to Rise in Volume, Price
Resales of single-family houses in the Valley area showed continued strength in April, with the volume up 30.1% from the month before and up 24.6% from a year earlier, the San Fernando Valley Board of Realtors said Monday.
The board also reported that the average sales price for a single-family house was $166,400, up 3.7% from March and 4.7% from April, 1985.
The turnaround in the condominium market also continued. Condo sales were up 11.7% from March and 73.4% from April, 1985. The average price of $109,900 was up 2.5% from a year ago, but down 3.6% from March.
Fewer Homes on the Market
Residential real estate in the Valley has been selling so fast that there are fewer homes available for sale than there were a year ago. Although 5.7% more units were listed for sale in April than in March, the total of 7,708 available at the end of April was still off 8.6% from April, 1985.
“I just hope increased sales won’t fuel another inflationary cycle,” said board president Temmy Walker. “If that happens, 18 months from now we’ll all be standing around without anything to sell.”
Real estate experts attribute the strong home-buying trend mainly to low interest rates on mortgages, plus pent-up demand for single-family housing and relatively little new construction of single-family houses in prime Valley locations.
The Board of Realtors gathers figures for residential real estate in the area from North Hollywood to Agoura, but only for units sold through licensed brokers. An unknown number of units, including most new dwellings, are sold by individuals or developers without the aid of a real estate agent.
Price Changes Only Moderate
But the board’s figures still point to trends, and they have shown a strong market in recent months. Board members sold 1,396 homes and 248 condos in April, but the Valley has seen only moderate price changes.
Walker said one problem in the strong market is that real estate appraisals haven’t fully kept pace. She said that appraisers, burned by the booming market of the late 1970s followed by the downturn in the early 1980s, have been issuing conservative valuations.
Lenders use these valuations to make loans, and the result, Walker said, is that buyers often have to come up with larger-than-expected down payments to cover the difference between the valuation and the higher market price. The buyers, therefore, find themselves paying more than the appraisal.
