Home Values Climb, and No Slide in Sight

Single-family home values in the San Fernando Valley continued to show strength last month, posting the largest year-over-year percentage gain of any January in the last 10 years, according to figures released Monday.

The region’s robust showing prompted a real estate expert to predict “conservatively” that home values will grow 5% to 8% this year, on the heels of 1999’s 12% increase.

January’s median price for a single-family home was $222,000, a gain of 16.8% over January 1999’s figure of $190,000, according to a report by the Valley-based Southland Regional Assn. of Realtors. That gain marked the third straight month of double-digit year-over-year increases in the Valley.

“That’s significant that you have repeated increases,” said G.U. Krueger, deputy chief economist of the California Assn. of Realtors, a statewide trade group. “It looks like home-price appreciation is accelerating in the San Fernando Valley.”

The median price also grew slightly over December’s figure of $219,900, despite a plunge in sales volume.

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Experts said other factors also pointed to the continued heft of Valley home values:

* January marked the 12th straight month that single-family home values have hovered at or above the benchmark $200,000 level.

* Four of the last five months have seen double-digit increases in value. (The exception was October, when the increase over 1998 was 6.8%.)

* Between 1991 and 1997, January prices trended consistently downward, with no January during that time posting higher figures than the year before. The 16.8% gain posted this year is nearly double the January 1999 increase.

With the economy remaining strong and demand outstripping supply, median prices “conservatively . . . will increase between 5% and 8% for the year,” said Jim Link, executive vice president of the Valley Realtors group. “And it could be substantially more than that.”

The California Assn. of Realtors has predicted a 5% increase for 2000 in the median statewide home price, to $228,400, after an 8% increase in 1999. At the same time, sales of existing single-family homes in California are expected to drop by 8%.

Link said signs of the slowdown in single-family sales already can be seen locally.

In January, 705 single-family homes changed hands, down only 2.2% from January 1999, but down 28.4% from December. A year earlier, the December-to-January drop in sales volume was 28.9%.

“I think the decrease in single-family sales is directly attributable to a lack of inventory,” Link said. “Our inventory is as tight as it’s been in 10 to 12 years.”

The local association’s Multiple Listing Service included 4,358 properties at the end of January, down 16% from a year ago. Of that total, 3,515 were single-family homes and 843 were condominiums.

Link said that for a region this size, “we really would like to see a minimum inventory of 6,000 properties.”

Competition in the single-family market has pushed more buyers into the condo market, experts said.

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In January, 244 condominiums closed escrow, up 27.7% (or 53 units) from January of 1999. But the figures again were lower than in December, when 310 condos were sold.

The median price of a condo in the Valley in January was $118,600, down 3.6% from a year earlier.

Santa Clarita Valley home values also continued to edge upward, even as sales slowed.

The median price of a single-family home was $235,000 in January, up 5.5% from a year ago but down 4.1% from December. Buyers closed escrow on 108 homes, down 25% from January 1999, and down by more than half compared with December, when 217 single-family homes changed hands.

In the Santa Clarita condo market, the median price was $131,800 in January, up 8% from January 1999. Sales in January were exactly even with a year earlier (60 in both cases) but were down from December, when 103 condos were sold.