Valley Has Fewer Homes to Offer Strong Market
San Fernando Valley home buyers will have a running inventory of about 5,000 homes and condos from which to choose this spring and summer--a number that seems to suggest plenty of choice and variety for the strongest home-buying seasons.
But those who know the numbers say the Valley’s housing stock is thin when compared with demand, especially in the new-home market.
With demand continuing to grow, the economy continuing to improve and interest rates remaining low, the strength of the housing market means buyers will have to shop harder and faster to find the homes they want, real estate brokers say.
Increasingly, those who want a new home will have to look outside of the Valley to the nearby Santa Clarita Valley. And those who want low-priced, entry-level housing will need to look in more distant markets like Palmdale and Lancaster or Riverside and San Bernardino counties.
“The inventory is slimmer than we’d like to see. We don’t have a huge supply,” said Beth Sommer, president of the Southland Regional Assn. of Realtors.
Analysts say the housing market has improved so dramatically from just a few years ago, and so little land remains for new home construction, that the San Fernando Valley has become almost entirely a resale market.
More than twice as many single-family homes, 10,220, were on the market as recently as 1993. The dearth of new home construction also reflects a near halt in the building of condominiums, which were being built by the hundreds in the Valley as recently as 1994. Only 34 newly built condos were on the market at the end of 1998, according to the Meyers Group, a real estate consulting firm that tracks home construction. “San Fernando Valley is a very strong housing market if you look at the resale numbers, but there’s just not a lot of new housing,” said the Meyers Group’s Bob Bray. “The San Fernando Valley has gone from a high of about 60 new home projects under construction in the early 1990s to less than 20. For the most part, the Valley is built out,” Bray said.
As a result, he said, “If you want to look at the San Fernando Valley housing market today, you almost have to look at the Santa Clarita Valley.”
The Southland Regional Assn. of Realtors has done just that. The group, which formerly tracked housing sales and inventory only in the San Fernando Valley, within the last year has begun tracking Santa Clarita Valley sales.
Although the association’s figures show the existing inventory is actually much smaller in the Santa Clarita Valley--800 single-family homes and 314 condominiums--the potential for new home construction is much greater than in the San Fernando Valley.
According to Marlee Lauffer, a spokeswoman for the Newhall Land and Farming Co., only seven projects are actively selling in Valencia, compared with 17 projects last year at this time, with about 50 to 100 homes in each project. But by the end of the year, she said, “We expect to have about 12 different builders active in 17 different projects.” Newhall no longer builds homes itself but sells the land to individual developers.
Lauffer said the next major development scheduled in Valencia is Woodlands, a project of Laguna Hills-based Taylor Woodrow Homes Inc. under construction near Valencia Boulevard and Tourney Road.
According to Barbara Stowers, a Taylor Woodrow vice president, the development will include 316 homes in four neighborhoods, with prices ranging from approximately $300,000 to more than $600,000.
Stowers said market research through focus groups has shown that many buyers today want homes that differ from those of developments a few years ago, when garages often faced the street, front yards were small, and two-story homes were more popular.
“We have really seen a growing market for single-story houses,” Stowers said. She said Taylor Woodrow’s development also will include more downstairs master bedrooms, front and side courtyards, and garages in the back because “people today seem to want something more like the older neighborhoods in places like Santa Barbara and Pasadena, with front porches and courtyards and decks.”
But buyers won’t find hundreds of the new homes just waiting to be bought because Taylor Woodrow’s approach, like that of most other developers today, is to “sell our houses before we build them.” The company completes a few models homes and then takes orders from buyers.
Among the few places in the San Fernando Valley where much new home building is under way is Porter Ranch, where developer Shapell Industries has a number of neighborhoods under construction. Randy Tasch, general sales manager at Shapell, said the company is planning a development called Villagio and another called Renaissance for this buying season. Tasch said prices of Villagio’s 3,000-square-foot homes and those of Renaissance’s 4,000-square-foot homes have yet to be set.
With relatively few new homes being built in the San Fernando Valley and more new construction in the Santa Clarita Valley, the Meyers Group’s Bray said that whether buyers find what they want this year will depend on their preferences.
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Valley Housing Supply
The supply of resale homes on the market has tightened sharply since peaking in 1992.
