Summer Sales of New Homes in Region Off 33%

El Nino rains in the winter and spring contributed to a 33% drop in new-home sales during the summer in the San Fernando and Santa Clarita valleys, according to a report released Thursday.

The rain-delayed building season kept many new housing projects that had been expected to be available during July, August and September off the market for most of the quarter, said Bob Bray, a marketing executive for the Meyers Group, the Irvine-based real estate research and consulting firm that released the report.

Sales of new single-family homes and condominiums in the region dropped to 470 during the third quarter--the fewest since the first quarter of 1997. That compares with 699 sales for the third quarter a year ago, the report said. The drop from the second quarter of this year was even greater--41%.

And while the August report on sales of existing homes also showed decreased activity, Bray said he sees no overall slackening in the marketplace.

“I don’t think it at all indicates a slowing,” Bray said. “This is more of a supply issue than a demand issue. With all the rain we had, that delayed [construction]. That’s why we’re two to three months behind.”

The report said 14 projects had sold out during the quarter--June 15 to Sept. 15--further reducing supply.

“We have less than a three-month supply” of new homes, Bray said. “That’s really tight. We think a healthier market is a three- to six-month supply. If you get under three months, it tends to put a lot of pressure on pricing.”

Glen Yamamoto, project manager for Pacific Bay Homes, listed in the report as the No. 1 builder of detached homes in the two valleys, recalled a recent weekend when only two new homes were available for move-in in the Santa Clarita area.

“We’ve been selling them as fast as we can build them,” said Yamamoto, whose firm sold 42 homes during the quarter to capture 10% of the market.

“More than anything else the sales number is a function of availability,” he said. “We have far less [inventory] than we had last year.”

Potential buyers lamenting the lack of options should not look for any big construction push in coming months, experts said.

David Keim, chief building inspector for the city of Los Angeles, said there had been a 2% dip in the number of permits issued for residential construction: from 6,328 issued between March and August 1997 to 6,202 in the same period this year.

By comparison, permits for city as a whole increased 7%.

“The San Fernando Valley just doesn’t have a whole lot of new product,” Bray said. “It’s mostly built-out. That also goes to the supply issue.”

As it has for the past several quarters, Santa Clarita, with its wide-open spaces, dominated the new sales picture, accounting for 310 homes and condos sold, or nearly two-thirds of the total.

Nevertheless, the San Fernando Valley, not Santa Clarita, contained the three best-selling projects during the quarter: Belcourt in Northridge, Presley at Carey Ranch in Sylmar and Renaissance Belleza in Westlake Village.

Prices for Belcourt ranged from $418,000 to $466,000, which supports one developer’s sentiment that higher-end properties continue to do well.

“We’re dealing with properties of $900,000 and up,” said Edward Zinke, senior vice president with the Braemar Group, an Agoura Hills-based developer that specializes in high-end properties.

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Times staff writer Karima A. Haynes contributed to this story.