Valley Home Sales Up 41% in March

Spurred in part by panic over rising interest rates, and flush with cash from the recently booming stock market, single-family home buyers in the San Fernando Valley pushed home sales up 41% in March, compared with February, a trade group said Monday.

Meanwhile, the median price of a single-family home slipped a bit, to $223,000 from $225,000 in February.

Over the last 10 months, Federal Reserve Chairman Alan Greenspan has increased interest rates five times--providing just the nudge to turn the hesitant hunters into motivated buyers.

“That’s a tremendous jump,” Mel Wilson, former president of the Southland Regional Assn. of Realtors, said of the increased sales activity. “It seems that when the public found out that the interest rates were going up, they got off the fence and decided to make a decision now.”

Barry Greene, owner of Century 21 Greene Realty in North Hollywood, said: “People were running, literally running, to get into a house. They’re afraid of what Mr. Greenspan might do.

“There are also a lot of people with money from the stock market,” added Greene, who’s been in real estate in the Valley for more than three decades. “They’ve got $15,000, $30,000 from the stock market to use for a down payment.”

That extra cash is helping some buyers adjust to the steadily increasing cost of a Valley home.

Though down 0.9% from February, the March median price represents an 11% hike over a year ago. It’s the strongest March showing since 1990, but it still is shy of the region’s all-time high of $245,000 for a single-family home set during several months in 1989, according to the Realtors association, which released Monday’s figures.

And while the median price for a single-family home has been above the benchmark $200,000 level every month since February 1999, it has not passed beyond $225,000 since 1992.

Greene, for one, thinks the region is about to break out of that rut.

“I guarantee you by September, it’ll be up to $235,000 at least,” he said. “The houses that are coming on the market are being listed for higher prices--10%, 15%, 20% higher--than they were a year ago.”

Wilson, vice president of operations for Coldwell Banker, said missed opportunities in the past also are helping to bid up prices today.

“Everybody wants to feel they got a good buy,” Wilson said. “Now, if a buyer tries to low-ball the price, there is someone waiting in the background to offer closer to what the owner wants.”

That dynamic, he said, is helping move prices back to levels seen before the local real estate market was wounded in the most recent recession.

“I don’t know if we’ll be back at 1989 levels next month,” Wilson said, “but I think you’ll see a gradual trend toward that mark.”

Realtors also noted that the increased demand is facing a fairly tight supply.

Valley home buyers closed escrow on 1,116 single-family homes in March, up just 2.7% from the year-ago period, but a gain of 327 homes over February.

And the level of activity was fairly evenly distributed throughout the Valley, with the red-hot southeast section, including Studio City, increasing by 58% compared with February and even the northeast section gaining 38% over February sales.

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But the number of new listings dropped by 2.5% compared with last year, though it gained nearly 30% (426 homes) between February and March.

Also during March, buyers closed deals on 379 condos, up nearly 16% from March 1999 and up 33% (or 94 condos) from February.

The median price for a condo was $137,000, up 6.2% from the year-ago period and up nearly 5% from February.

In the Santa Clarita Valley, 115 condos changed hands, for a 9.5% gain from the year-ago figure and a 74% leap from February.

Buyers took possession of 172 single-family homes, down nearly 30% from the year-ago figure, and just about even with February. The median price for a single-family home in the Santa Clarita Valley was $244,000, while the condo median was $133,000.