GLENDALE — Home prices are on the rise, spurred by surging demand from buyers over a dwindling supply of low- to mid-priced property, real estate agents say.
Price trends in Glendale and Burbank are on par with recent averages for California and Los Angeles County, where sales values have modestly increased, according to agents and reports released Tuesday by the California Assn. of Realtors and Standard & Poor’s.
“All the statistical data that we’re seeing seems to show that the market is returning to heading up, but I would say more like we’re skipping or bouncing along the bottom of the real estate market,” said Steve Goddard, president-elect of the association.
The statewide median home price rose 3.9% from June to July, according to the association.
Home prices in the county jumped 1.1% from May to June, according to Standard & Poor’s latest figures.
But while aggressive buyers hoping to take advantage of federal tax credits and low interest rates are pushing up prices by creating bidding wars for the few properties up for sale, owners who don’t have to sell their homes are not doing so, real estate agents said.
The result is a tight market that has created a sense of competition that might not otherwise exist, agents said.
And many home owners fear that the sagging economy and a possible new wave of mass foreclosures could further depress prices, preventing them from entering the market even though there is no telling when or if those properties will affect values, said Keith Sorem, a Glendale-based agent for Keller Williams Real Estate.
“There may be a lot of [foreclosures] out there but the problem seems to be in getting them to the market,” Sorem said.
If a stream of low-priced homes hits the market, it could increase supply and relieve demand, or bring down prices, but banks appear to be holding off on putting foreclosures up for sale, if the rumored wave of foreclosures even exists, he said.
Still, competition for homes priced $500,000 and less is so heated that more owners with real estate in that range may begin to think about selling as the market goes up, even if they don’t absolutely have to, said Dan Soderstrom, an agent for Dilbeck Realtors in Burbank.
“Someone that’s not in financial peril would be surprised at what they could get for their home, in terms of the demand out there for a quality product,” he said.
Prices do seem to be rising for low- to mid-range homes because of high demand, said Kendyl Young, an agent for Coldwell Banker in Glendale.
“I’ve been noticing that multiple offers are actually leading to offers that are only slightly above the natural market price,” Young said.
Higher-priced transactions, on the other hand, have been slowed because of challenges for getting loans for homes costing more than $729,000, agents said.
Still, with recent modest pricing gains, the market may be in an upswing that could continue at a gradual rate, said Brad Korb, an agent for RE/MAX In Action in Burbank.
Even if more homes do start pouring into the market, strong demand for mid-priced property will likely keep those prices stable, Korb said.