Ventura County Housing Price Increases Show Signs of Slowing

After three years of frenetic price increases, Ventura County’s housing market is beginning to show signs of slowing, curbed by rising interest rates and prices that may have escalated beyond the incomes of many middle-income buyers.

Some real estate agents estimate that prices will rise only half as fast in 1989, and others predict that housing costs may even level off. In the $190,000 to $250,000 range, homes that used to sell in hours are now stalled on the market for 45 to 60 days, real estate agents say.

“That area has really slowed down. Houses just went up too high too quickly, and salaries didn’t,” said Margit Taylor, a real estate agent at MacElhenny Levy in Ventura.

Across-the-Board Slowdown

Other industry watchers said the real estate cooling transcends price range.

“It’s across-the-board. At some of the new, high-end projects, the sales offices are empty,” said Ernest Siracusa Jr., who heads a market survey firm in Westlake Village.

Bank of A. Levy President Marshall C. Milligan said higher interest rates and burdensome down payments have knocked many would-be homeowners out of the marketplace.

“I look for a leveling off similar to what we had in the early ‘80s,” he said.

Many real estate officials said they expect the upward march of prices to continue, but as a gentle stroll.

The median price of a resale home in Ventura County rose 10.6% in 1986, 11.9% in 1987 and 28.4% in 1988. By February, the last month for which the California Assn. of Realtors has figures, the median price was $244,010.

Slower Rise Predicted

But such steep increases in the near future are unlikely, many industry experts say.

“We’re looking at prices to slow somewhat as interest rates move up and prices move more and more out of reach for buyers . . . in the market for the first time,” said Roger Cruzen, a spokesman for the California Assn. of Realtors.

Cruzen estimated that resale home prices in Ventura County will rise 10% to 15% this year.

“Last year’s performance was somewhat extraordinary,” he said. “I don’t think we’re going to see that market matched in 1989.”

Many say it is too soon to predict whether housing prices have slowed down for good.

“It’s hard to tell at this point whether that’s a trend or a blip. We need a little more time,” Siracusa said.

Industry watchers say high interest rates, a slowdown of the U.S. economy and the loss of buying power in terms of rising home costs contribute to the slowdown.

And Southern California residents face grim statistics: Although 47% of residents nationwide can afford to buy homes, the figure drops to 16% in the Los Angeles area, including Ventura County, according to the California Assn. of Realtors.

Interest Rates Rise

Rising interest rates have compounded the problem.

At Bank of A. Levy, for instance, variable interest rates have risen from 10% to 11.94% in the past year; fixed-interest rates have gone from 10.5% to 11.77%.

Local real estate agents say properties no longer are being snapped up overnight.

“Our inventory has increased, and the number of sales has decreased slightly. The market isn’t as hectic as it was last year, and there’s more for people to choose from,” said Helen Kline, president of the Conejo Board of Realtors.

Siracusa said that four months ago, a Westlake Village condominium development sold 17 of its 20 new units at upwards of $300,000 within one weekend. But a second series of 30 condominiums has sold only four or five units in the past month, he said, declining to name the developer.

“I’ve heard more negotiations going on, more dickering, less willingness to pay asking prices,” he said.

Estate Homes Sell

Taylor, of MacElhenny Levy, said exclusive homes are more in demand.

“The estate-type homes, the beachfront and view houses are selling real, real rapidly,” Taylor said. “I just listed a beach home on the Rincon, and it sold in two days. Last year, it could have sat for six months.”

But others say the market for high-end homes is on the downswing.

“Many people have sensed a peak in the market, and that’s why we’re seeing a lot more inventory for sale,” Milligan said. He said buyers of high-priced homes, whose revenues depend not so much on weekly paychecks as on long-term investments, are beginning to see the effects of the economy’s slowing.