Friday, January 01, 2010

San Fernando Valley Market Update

Here is the most recent market update for the San Fernando Valley Real estate area.  Please pay special attention to the highlighted sentences.

Home sales fell compared to the prior year for the first time in 16 months during October throughout the San Fernando Valley due to an extremely tight inventory that has triggered dozens of offers on virtually every property listed for sale under $500,000, the Southland Regional Association of Realtors® reported.

The exceptional demand from buyers eager to take advantage of a federal tax credit and the most favorable resale prices in years pushed home and condo prices higher.

"There is widespread interest in buying a home with dozens of competing bids coming in on virtually every property listed under $500,000 and a few examples of properties receiving 50 to even 100 offers," said Ana Maria Colon, president of the Southland Regional Association of Realtors®.

"It's preposterous and difficult to believe," she said, "yet multiple offers and this intense competition also illustrate the underlying faith consumers have in the economy along with their deep desire to own a home."

Unfortunately, Colon said, because there are so few properties listed for sale traditional buyers - even those coming in with a 50 percent down payment, a job and high credit scores - often lose to all-cash buyers, many of whom are investors.

There were a mere 2,858 properties listed for sale throughout the San Fernando Valley at the end of October, a number that was down 51.7 percent from a year ago.

"At the current rate of sales, the inventory represents a mere 3.2-month supply," said Jim Link, the Association's chief executive officer, noting that a "balanced market" appears when there is a 5- to 6-month supply. A year ago the inventory represented a 6.0-month supply.

"Realtors® would be completing many more sales if the inventory was higher," Link said. "We expect the market to remain very busy well into next year, particularly now that the $8,000 federal tax credit for first-time buyers has been extended through April and existing home owners who trade up or down are also eligible for a $6,000 tax credit."

Source: Southland Regional Association of Realtors

If you are thinking of buying a home under $500,000 in the San Fernando Valley, it's important you are working with a professional.  I have additional resources other agents don't to find you the perfect bank owned home or short sale home under $500,000.

You can search for San Fernando Valley bank owned homes.  When you are ready to actively look for homes, you will need to get pre-approved with a loan officer.  Please call me to schedule a meeting at my office in Tarzana so we can discuss your next move.

If you are planning to purchase a home with an FHA loan, please read my post concerning the difficulting of buying with an FHA loan here in the San Fernando Valley.

Richard Johnston
RE/MAX Grand Central

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