Home Values Top $200,000 for 6 Months, Report Says
For the first time since 1992, San Fernando Valley home values this year have been above $200,000 for six consecutive months, indicating continued strength in the local housing market.
The median sales price for a single-family home in the Valley was $218,000 in July, according to figures released Monday by the Southland Regional Assn. of Realtors. That was the highest July figure since 1991, the group reported.
“I think that it really shows how strong the market is,” said Beth Sommer, president of the real estate trade group, which tracks housing sales and values. “People have equity in their homes, so you’re going to see that they can sell and move up. It’s a move-up market.”
Property values--residential, commercial and industrial--are rising throughout the Valley area, according to figures released this week by the Los Angeles County assessor’s office.
Glendale, in terms of dollar value, had the fourth largest assessed value increase in the county--a $740-million gain, coming in behind Los Angeles, Beverly Hills and Santa Monica. That represented a 6.5% gain.
And tiny Westlake Village led all communities in the county in percentage gain, posting assessed value growth of 13.09% (or $169 million), according to figures from the assessor’s office.
“The Valley appears very strong,” said Richard Angelucci, principal assessor in the Chatsworth regional office, which values properties in the West Valley. “The volume of activity is increasing and the price and the value are increasing.”
The area covered by the Chatsworth office saw a 7.5% increase in assessed value, for a $2.38-billion gain, assessor’s figures show.
The Van Nuys office, which covers mostly the East Valley, posted a 5.1% gain, for $1.48 billion in increased value.
And the Newhall office, which covers the booming Santa Clarita Valley, and the communities of San Fernando and Pacoima, saw a 7.2% gain, for a $1.2-billion hike in assessed values.
“And remember,” Angelucci said, “we had an earthquake out here. We might have been a little more depressed than other areas. So we might have had more of a way to come back.”
But not everyone is greeting the rising prices with glee.
Helen Rangel, a real estate broker with White House Properties who has more than 20 years in the business, said some of her clients are experiencing sticker shock, especially in tony areas like Calabasas and Woodland Hills.
“Of course people are kind of shocked to say the least,” said Rangel. “And now we’re seeing interest rates go up.”
Mortgage interest rates slipped over 8% for the first time in more than two years earlier this month. But many local real estate experts said the higher rate is not likely to slow the current housing boom.
Even so, Rangel said the rate hike, coupled with rising prices, forms a one-two punch for some would-be buyers.
“If they were, say, just able to afford what they were going to buy, they have to come down now,” said Rangel, adding that she’s seen prices jump in some areas of Woodland Hills by $50,000 over the last year. “They just can’t afford it any more.”
July’s gains in value helped the Valley regain some ground lost in June, when the median price on a single-family home dipped to $215,000, from $220,000 in May. Prices remain about 12% shy of the all-time high of $245,000, set in November 1989.
Still, real estate officials see the trend, especially the consistent standing above the benchmark $200,000 level, as yet another sign that the region has finally shaken off the real estate slump of the mid-’90s.
“I think it’s gone,” Sommer said. “We’re seeing as good a month in real estate as we’ve seen in a decade.”
As a byproduct of the rising values, Joe Riggio, regional vice president of Calabasas-based Countrywide Home Loans, said his firm is seeing an increase in the loan amounts requested.
“There’s been an increase in values in the San Fernando Valley, which has transformed into higher loan amounts,” said Riggio, whose region includes the Valley.
“I’ve seen an increase in activity in the purchase business and in the home equity business.”
In terms of sales activity in the Valley, the July numbers were down slightly from July 1998. Figures show that 1,306 single-family homes changed hands in July, down less than 1% from the 1,316 posted the previous year.
The median price of $218,000 was nearly 7% greater than the $204,000 median seen in July 1998.
The condo market continued to steam ahead, with sales posting a nearly 15% gain over a year ago--361 this July, versus 315 last. The median price was up only 3.3% to $127,000.
In the Santa Clarita Valley, 392 homes closed escrow, up only one home from the 391 sold in July 1998. The median price rose by about 4% in the same period, to $198,000.
Even with increased values and interest rates, Sommer sees the market as affordable for many would-be buyers.
The increase in the interest rate from 7% to 8% means an increased monthly payment of about $150 on a $175,000 loan. That, she said, is probably not enough to keep most serious buyers out of the game.
“Hopefully,” she said, “it’ll make people say, ‘Maybe I ought to get in this market now, while I can still get a good loan.’ ”
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Housing Activity
July single-family home values in the San Fernando Valley rebounded to levels not seen since the early part of this decade.
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Source: Southland Regional Assn. of Realtors
