Gregory J. Wilcox: San Fernando Valley housing market recovery is settling in
By Gregory J. Wilcox, Staff Writerdailynews.com
All of the state and local housing reports for February are in and they add up to 2013 being the year a market recovery has settled in. Prices are up across the region and foreclosures are pretty much back to pre-recession levels.
That trend was noted again on Thursday when the San Fernando Valley Economic research Center at California State University, Northridge, reported that foreclosure activity plunged in February from a year earlier.
"It's real good news, but for Realtors it's not that good because there is nothing to sell," said economist William W. Roberts, the center's director.
The center tracks the market from Glendale through Calabasas.
Last month notices of default, the first step in the foreclosure process, dropped 58 percent to 306 from 728 a year earlier. But they increased from 203 in January. But defaults are now 87.9 percent under the peak of 2,539 reached in March 2009, the center said.
They began trending down in August 2010.
Foreclosures fell 58.6 percent in February to 126 from 304 a year earlier. And they declined from 182 in January.
Most of the bad loans have worked through the system but Roberts expects foreclosure of 100 to 200 a month for the next six months in response to still high unemployment.
The decline in foreclosures has constrained the inventory and put a damper on sales.
Last month sales of new and previously owned houses and condominiums fell 9.2 percent to 1,046 properties from 1,152 in February 20012, and they fell from 1,100 in January. The median price of a new or previously owned Valley house rose 19.4 percent in February to $424,000 from $355,000 a year earlier. And it increased $4,000 from January.
Distressed properties now have less influence on the market.
This is evident in data collected by the Southland Regional Association of Realtors, which tracks the market from Toluca Lake through Calabasas.
For example, of last month's 541 home and condominium sales in the association's market, 13.9 percent were foreclosed properties.
Short sales accounted for 20.7 percent of sales.
William Wei-Choun Yu, an economist at the UCLA Anderson Forecast at the university's Anderson School of Management, thinks now is a good time to assess the fundamentals of pricing.
"In the long run, just like all other free-market products, regional home price growths are determined by local fundamentals - demand and supply," he wrote in a market analysis this week.
The numbers show that the demand is now there, but the supply is not.
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