Valley Median Home Prices Hit Record $260,000

Driven by a huge leap in May, single-family home prices in the San Fernando Valley hit a record high median price of $260,000, a real estate trade group reported Monday.

The median cost of a single-family resale home in the Valley, or the price at which half the homes sold for more and half for less, surged by 6.3% between April and May. The May sales numbers represented an 8.8% jump over the same month last year, according to the monthly report by the Southland Regional Assn. of Realtors.

The previous record of $255,000 was set last August. That beat the mark set in 1989 before the recession sharply cut into home values.

“Real estate, like anything else, will have its ups and downs,” said Jim Link, the association’s executive vice president. “But the numbers show that over time, a home is generally a positive investment and you don’t lose money on it.”

In another sign of the market’s health, Valley home sales surged by 21% in May, the result of low inventories and a seemingly insatiable demand for properties, the group reported.

The number of homes that closed escrow in May swelled to 1,247 from 1,031 during the previous month. Those numbers were about 8.4% ahead of the same period in 2000, the group said.

Industry officials had expressed concern last month that rising fuel and energy costs, corporate layoffs and a weakening stock market could crimp the housing market just as the traditional spring-summer home-buying season was heating up.

But the latest figures appear to put those concerns to rest, Link said.

“What we saw in May was a strong rebound from a sluggish April due to a couple of factors,” Link said. “There was good weather coupled with the Fed interest rate cut. And hungry buyers just ate it up.”

Robert Kleinhenz, a senior economist with the California Assn. of Realtors, said after a difficult first quarter the local housing market appears to be resuming the strong pace it had late last year.

“The first three months of the year it was tough across the state,” Kleinhenz said. “Things picked up in March, and in April the market was looking for a direction. It seems to have found it in May.”

Kleinhenz added that the strong housing market should come as no surprise because the Southern California market and economy have been stronger than the state’s as a whole.

“There’s an awful lot of people who still want to buy a home,” he said. “And the median price home in Los Angles County is still modest compared with the state median and the Bay Area median, which was $484,000, versus about $227,000 locally.”

In contrast, Valley condominium sales, a major beneficiary of customers scared off by soaring single-family home prices, dipped 5.7% in May with 430 units closing escrow.

The median price of a condo held steady at $149,500, or 1.7% over April and 10.7% ahead of the same period last year.

In the Santa Clarita Valley, home sales rose 6%, with 316 houses changing hands compared to 298 the month before. Meanwhile, the median price of a single-family home fell 0.3% in May to $265,000 month over month. However, prices were up 8.8% over the same period last year.

In the Santa Clarita Valley condo market, 167 units closed escrow at a median price of $148,900, which was down 0.7% from April. The median condo price rose 8.7% compared to May of last year.