Single-family houses in the San Fernando Valley sold for an average price of $221,100 in December, down only $100 from their record high in November, and a gain of 20% from the $184,000 average price a year earlier, the Valley Board of Realtors reported Monday.
The number of single-family houses sold in December totaled 895, down 19% from 1,106 a year ago, and down 10% from the 995 houses sold last November, the board said. Sales for all of 1987 totaled 13,334, down 4.7% from the 13,985 sold in 1986.
Sales prices of Valley condominiums averaged $120,100 last month, down 17% from a record high $144,900 in November, but an 11% gain from $108,300 a year earlier, the group said.
Valley condominium sales, however, remained strong in December. They totaled 267, up 8.5% from 246 in November, and up 7.7% from 248 a year earlier, the board said. Condominium sales for the year totaled 3,167, up 22% from 2,599 in 1986.
The board noted that the December price drops came against November price records that were somewhat skewed by the sale of an unusually large number of expensive properties that month. Regardless, the year-to-year price gains reflected the ongoing economics of Valley real estate: a low supply of houses for sale together with lots of people looking to buy.
"Many homes sold even before they could be listed on the Board's Multiple Listing Service," board President Tom Carnahan said in a statement. "That's great for sellers, but some buyers got caught in the bidding war over choice properties."
For instance, the board reported 3,597 single-family houses for sale in December, down 20% from the 4,499 listed a year earlier.
Carnahan said the board was expecting a larger inventory of available houses in 1988, "which should give buyers room to do more bargaining. However, buyers who wait too long may find any increased bargaining power more than offset by further price increases."
Although unit sales of single-family houses fell last month, the board said December's pace was exceptionally strong for the normally quiet month, when would-be home buyers are busy with the holidays.
The group also noted that the December, 1986, sales had been boosted by home buyers looking to acquire real estate before major changes in federal tax laws took effect in January, 1987.
Last month's sales also indicated that the fallout from the stock market's crash Oct. 19 actually boosted housing demand in the Valley, principally because the crash led to lower mortgage rates, the board said.
"Ironically, the stock market woes helped home sales," Jim Link, the board's executive vice president, said in a statement. "It helped bring lower interest rates and it certainly convinced many people that real estate is a solid investment."
Combined sales of single-family houses and condominiums totaled 16,495 in 1987, up only a fraction from the 16,472 units sold in 1986, but still the highest sales level since 1979, when a record 19,964 dwellings changed hands, the board said.
Sales of houses and condominiums in December were 1,162, down 14% from the 1,354 units sold a year earlier.
"To have more than 1,000 sales during December is unusual, almost incredible, especially since we did not have the prospect of tax reform laws that triggered many sales in December, 1986," Carnahan said.
The Valley realty board, California's largest, reports sales of houses and condominiums by its members from North Hollywood to Agoura. Its statistics do not include most new residences, which are generally sold without a real estate agent, or existing homes that are sold by their owners.
North West: Avg. Price: $249,600
North Central Avg. Price: $229,200
North East Avg. Price: $127,000
South West Avg. Price: $273,158
South Central Avg. Price: $243,200
South East Avg. Price: $218,900
HOME SALES 1985-87
Average Annual Year Price Sales 1987 $203,433 13,334 1986 $173,708 13,985 Condominiums Average Annual Year Price Sales 1987 $119,733 3,167 1986 $111,942 2,599 1985 $110,088 1,612