HOME PRICES AT LOWEST LEVEL IN 3 YEARS REAL ESTATE: REALTORS ASSOCIATION THINKS VALLEY SALES HAVE FINALLY BOTTOMED OUT.

Byline: Gregory J. Wilcox

Staff Writer

VAN NUYS -- The San Fernando Valley's residential real estate market remained frozen during November with both sales and prices retreating substantially from a year ago, a trade association said Wednesday.

The median price of a previously owned single-family house fell an annual 6.3 percent, or $37,500, to $557,500, said the Southland Regional Association of Realtors. It's the lowest median in 32 months, or the start of the 2005 second quarter.

Sales plunged an annual 53 percent, to 355 transactions, just one more than the record low set in October.

"I honestly think we're in a bit of an impasse. Buyers aren't doing anything and sellers are just sitting back waiting for something to happen," said Jim Link, the association's executive vice president.

"It was not good ... and we don't expect December's numbers to be any better."

Sales have now fallen on an annual basis every month since October 2005. And for the past three months an average of 357 properties changed owners.

Link believes that Valley home sales have finally hit the bottom of this current bust cycle.

"As we get into the new year, sales will not come back to any kind of robust number but they will increase from where they are now," he said.

A big reason for the sales slide is that lenders are still using tough credit standards and the $417,000 loan limit for mortgage giants Fannie Mae and Freddie Mac -- the biggest home loan they will buy from a lender.

Prices are still so high here that most buyers would need a jumbo loan, a product that's now tough to get.

During November, the inventory of unsold homes -- the time it would take to sell all homes on the market at the current sales pace -- reached 15 months.

The association characterizes that as a moderate supply and unlikely to yield deep price discounts in the coming months.

Some potential buyers talk of holding out for price declines of 25 percent to 30 percent from the current level.

"It's just not going to happen here," Link said.

That's because the Valley's market is more mature and there has not been much new construction over the past few years. And while foreclosures are increasing, they are not yet depressing prices.

And there is a sign that December's statistics will look a lot like November's.

Pending escrows, a sign of future sales, totaled 559 at the end of November, down from 606 at the end of October and off 48 percent from a year ago.

The record low is 385 in December 1992, part of the previous down market.

Jack Kyser, vice president and chief economist at the Los Angeles County Economic Development Corp., said this tough market will persist throughout the year.

"You may have a buyer who may have good credit but can't get a mortgage loan," he said of the pressure the credit crisis continues to exert on the housing market.

"And you have people frightened to death that there will be more price declines."

The Valley's condo market took a similar hit. Sales plunged 50 percent, to 141 transactions, and the median price dipped 4.1 percent, or $16,000, from a year ago, to $384,100.

In the Santa Clarita Valley, sales of single-family houses fell an annual 39.3 percent, to 111, and the median price declined 9.9 percent, to $522,500.

Condo sales fell 57 percent, to 38 transactions, and the median price fell 13.4 percent, to $316,000.

greg.wilcox(at)dailynews.com

818-713-3743

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(1 -- 2) Sales, Price Slide

Source: Southland Regional Association of Realtors

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