Residential sales drop for another month as some brokers see a change on horizon.

Residential sales drop for another month as some brokers see a change on horizon

The bad news for the San Fernando Valley residential real estate market is that home sales fell 12 percent in June from the month before. The good news is that mid-range priced homes are beginning to sell, possibly an indicator that the market is recovering, brokers note.

Steve Owen, president of the San Fernando Valley Board of Realtors, blamed slow sales on would-be sellers who are pricing their homes unrealistically high. "Californians don't want to adjust to the fact we may not be appreciating at 12 percent a month," he said.

There were 879 single family houses and 280 condominiums sold in June, as compared to 1,000 houses and 317 condos sold in May, a 12 percent drop, according to figures released by the real estate board. However, June 1991 home sales were 11.7 percent higher than June 1990 sales.

The boom in residential real estate sales immediately following the end of the Persian Gulf War was a result of pent-up demand, said Roger Ewing, regional director of northern Los Angeles County for The Prudential California Realty.

"Many people viewed that as an all-out recovery and it was not," Ewing said. Ewing said he believes the residential real estate industry has been "bouncing along the bottom" of the recession for several months.

Prudential's overall sales in the San Fernando Valley were down 15 percent for the month of June, Ewing said. However, Prudential's Sherman Oaks and Woodland Hills offices, which sell pricey homes, showed gains of about 10 to 12 percent, he added.

Homes in the $400,000 to $800,000 range "seems to be our strength right now," Ewing said. Lower priced homes tend to recover first and the fact that higher priced homes are selling is a good sign, Ewing said.

According to statistics compiled by the San Fernando Valley Board of Realtors, the price of homes selling is going up, said Herb Lambert, chairman of the board's greivance committee and manager of the Tarzana office of S.J. Heritage Inc.

In June, about 82 percent of all sales were homes priced below $350,000, as compared to earlier in the year when 80 percent of home sales were below $250,000, said Lambert. The figures indicate an increase in homes selling in the $250,000 to $350,000 price range, Lambert said.

"To me it indicates more of a move-up crowd," Lambert said. "Before we were seeing a lot of people selling their home and moving out, retiring, moving to Las Vegas. Now we're seeing people sell their first home, staying in the valley and moving up (in their second home)," Lambert said.

He said the movement of higher priced homes is a good sign for the housing market. However, he added, "Me, personally, I have not had good luck. I've had several listings expire in that $350,000 price range - more than I ever remember."

John Clipinger was lucky enough to sell his 3,600-square foot, Calabasas home with "a magnificent view of the valley," this summer for $650,000. But Clipinger said he was only able to sell the house, which he bought during the real estate boom about three years ago, after 18 months on the market and after he repeatedly slashed his original asking price of $850,000.

It was the first time and Clipinger said it will be the last time he will ever buy a home "on spec."

Clipinger bought the home three years ago for $675,000, but with the mortgage payments and the upgrades Clipinger put into the home, he figures he lost a total of $250,000 on the deal. "I took a bath. I just took a royal bath," Clipinger said.

Owen, president of the board of realtors, said it's still a buyer's market in the San Fernando Valley.

He said he lost a sale this summer because the seller wouldn't lower the price $2,500. Another seller told Owen she promised her children she wouldn't sell her home below a certain price, no matter what realtors advised.

"I had a lady call me this morning. She had her house on the market for two years and had been through six real estate agents. She thinks that by changing her agent she'll sell her house," Owen said.

Buyers have at their disposal information about prices in which homes sold in a certain neighborhood, Owen said. Buyers are still wary about making a large purchase with the current instability of the job market, he added.

Lambert agreed that many sellers are not pricing their homes aggressively enough to sell in this market. "A seller who has time to sell, doesn't have an immediate time incentive to sell his property, will tend to price the house in a way that competes with other active listings - and that is not cutting it right now," Lambert said.

However, homes which have been reduced to the seller's "bottom line," are selling and are in fact getting multiple offers, Lambert said.

PHOTO : Homes: Sales fell 12 percent in June from previous month