PRICES GOING UP; BUILDERS GO TO WORK AS SUPPLY OF NEW HOMES WANES.

Byline: Jason Takenouchi Staff Writer

Sales of new homes in the San Fernando and Santa Clarita valleys slowed in the year's second quarter as prices soared and inventories shrank, a real estate tracking firm reported Tuesday.

The trends were more pronounced in the Santa Clarita Valley, where new home sales represent a much larger percentage of the real estate market than in the San Fernando Valley.

In Santa Clarita, builders sold 486 attached and detached homes last quarter, 16.2 percent fewer than in the same period last year, according to a report by The Meyers Group.

The median price for a detached home increased to $302,000 last quarter, up by almost 31 percent from the same quarter of 1998.

Sales have slowed in part because new homes are crowding into the higher-price brackets, said Lorry Lynn, an analyst with The Meyers Group's Santa Monica office.

``Santa Clarita is really not the commuter, first-time-buyer market anymore,'' she said.

``We're building bigger, more expensive homes than we saw last year,'' Lynn said. ``It may be taking the market awhile to shift to that.''

But Lynn acknowledged that supply may also be a factor. Only seven newly built homes were unsold in the San Fernando and Santa Clarita Valleys as of June 30. At the same time last year, dozens more were available.

``If you wanted a new home today, you had seven choices,'' she said. ``I don't think I've ever seen a number that low before.''

The number of new homes sold in the San Fernando Valley during the second quarter fell almost 60 percent compared with the same period last year.

Builders sold just 88 new homes, including condominium homes, in the San Fernando Valley during the quarter, The Meyers Group reported. The median price for a new, detached house in the Valley was $461,000, a 12.5 percent increase from the same period last year. Sales of previously occupied homes dominate the real estate market in the San Fernando Valley, where in May alone, for example, escrow closed on 1,131 detached homes.

In fact, there were fewer newly built homes for sale in the entire San Fernando in the three-month period than the 92 sold during the quarter from just two Santa Clarita Valley projects, Toscana at Palisades by Shea Homes and Cheyenne by EPAC Communities.

Buyers have signed up for all 166 homes in the Cheyenne project, including the model homes, broker George Lally said, and other would-be buyers are waiting if escrow fails to close on a purchase.

The project's relatively low price range, from less than $150,000 to about $200,000, has been a major draw, Lally said.

``We could probably sell another two phases, another 50 or 120 homes, by the end of the year if we had them,'' Lally said.

As the supply of new homes dwindled, the demand for previously occupied homes climbed steadily over the past year.

It has become commonplace for house sellers to get multiple bids, said Bob Kellar, manager of Town Center Realty.

``It really is a seller's market,'' Kellar said.

But builders are preparing to replenish the new housing supply in the Santa Clarita Valley.

They took out 42 percent more building permits for homes in the area during the first five months of this year than in the same period last year, according to the Construction Industry Research Board.

With more new homes coming to market, median housing prices are set to rise, said board analyst Ben Bartolotto.

``I would think that you would start seeing it now,'' he said.

STRONG DEMAND

Sales of new single-family homes and condominiums declined in the second quarter of '99 compared to year-ago levels, but prices rose sharply and inventory shrank, suggesting that sales volume was held back by limited supply.

SALES: 797 in '98, 574 in '99. Down 28 pct.

PRICE (Condo): $153,990 in '98, $190,990 in '99. Up 24.03 pct.

PRICE (Detached): $289,945 in '98, $329,900 in '99. Up 32 pct.

NEW HOMES AVAILABLE: 80 in '98, 7 in '99. Down 91.25 pct.

SOURCE: The Meyers Group

CAPTION(S):

Photo, Chart

PHOTO (Color in Business only) A housing tract rises by Jason Drive in Canyon Country, where builders are struggling to keep ahead of the demand for new homes.

Shaun Dyer/Special to the Daily News

CHART: STRONG DEMAND (See text)