Good day everyone. I'm Connor with HONOR the owner and operator of the Santa Clarita home experts at REMAX.
This was to be expected related to home and housing inventory in the Santa Clarita Valley.
However, I would have thought that the home sellers would have slowed down a bit more than they have.
Currently as of April 6, 2020, at 0946:25hrs we have 370 residential units for sale. This is the total active real estate inventory in the Santa Clarita Valley in the cities of Acton, Agua Dulce, Castaic, Canyon Country, Saugus, Newhall, Stevenson Ranch, and Valencia.
The residential units that I am referencing are the Santa Clarita single-family homes (SFR's), the condominiums and town-homes.
As of yesterday, the number was 335 active residential units for sale and a few days before that, back on the 1st of April, we were at 325.
Sellers are still moving forward in having their homes placed onto the market for sale, but the buyers have retracted.
Homebuyers are in a strange place where they may be a part of a business that has laid them off for the time being. There are not very many home buyers that are going to attempt to buy real estate with so much that is currently unknown.
The concern from those buyers was were in the market wanting to buy homes in January and February is that COVID19 is going to continue to be active during the summer months with the current holds on various businesses extending through those months.
They may be okay for the time being, but buying a home is not on their priority list at this time. They are going to hold off and see what is going to happen.
I have been contacted by some of our investor clients wanting to know the state of the investment market in Santa Clarita real estate. I tell them it's too early to tell exactly what is going to happen with real estate, but a massive dip in prices is NOT something that the Santa Clarita home experts are expecting.
There is also a lot of homes on HOLD that do not show status. This is typically a status for real estate that removes home from the MLS for a particular amount of time. IT may be that the homeowner or one of those who are living in the home are sick or have other issues that prevent them to allow the home to be shown.
The HOLD do not show status is typically very low. We are approximately 8 times higher in the amount of "On Hold" properties than in the CoronaVirus Free market.
There are 87 residences that are being HELD currently. If those homes become active again, the Santa Clarita Valley will have 457 homes and residences for sale in the active status.
This would be a 23.5% increase of active residential real estate for sale in the Santa Clarita Valley cities as compared to Pre Coronavirus numbers.
Take into account the typical building of inventory that we see in a non-covid19 year. The building and additional inventory starts in Mid March and continues through August.
It's during those times where the home buyer drive can be enough to offset the building of real estate inventory. That would be in a market where the buyer drive is enough to even out the number of homes entering the re-sale market.
The missing item from the current Santa Clarita market during the Coronavirus pandemic is the buyer drive. The investors are waiting in the wings to make someone else's pain their profit. But Owner Occupant home buyers - they are in a peculiar place currently.
Their employment is in question or they are part of a business/profession that is still active, which is causing them concern related to contracting the virus.
I am a Retired LAPD cop. I have been in contact with a lot of those with whom I worked with and they have the valid concerns of bringing home the virus to their family or dying from it themselves.
Nurses, Doctors and other medical professionals, the last thing they are considering is buying a home at this time.
Some of the home sellers are selling because they are getting advice that this virus is going to kill the real estate market in the long term. They are hearing that the Los Angeles real estate market is going to be hit hard and have home prices slashed by double percentage digits.
Let's talk about the current time frames in which a typical escrow takes to close.
In the current housing market, at least before the pandemic, we were typically promised by the local lenders in Santa Clarita Valley they needed anywhere between 30 and 45 days to close escrow.
That is the time from when the contract is agreed upon by both the buyers and the sellers to the day when the property records into the buyers' name and the keys are given to them.
The pandemic and holds were put into place in March. There was a sort of a rush on real estate where lenders wanted to hurry and close just in case loans were pulled on a large scale. We did not see loans pulled on a large scale, but loans did get pulled.
It was reminiscent of the real estate markets that were subject to natural or financial disasters. Once those markets change as a result of those issues, some financial institutions pause the funding to re-evaluate.
This happened this time, but not on a large scale like the great 2006/2007 depression.
There are homes that are currently in escrow and that were being worked on when the pandemic was announced in March. Most of those transactions are somewhere between 1/4 and 1/2 completed as of now.
Once we close out April's figures, we will be able to see in May 2020 what affect the coronavirus had on the time it takes to sell Santa Clarita real estate.
As of the 6th of April, as you can see in the graph, it's business as usual, in fact, it would appear that we may have many more closings than in the previous three months of 2020.
This is due to the rush and the overlap from the previous month. Once the escrow times run their course, we will be in a better position to determine the effect of Covid19 on the time it's taking to sell real estate in Santa Clarita Valley.
What should you be doing now? Homeowners:
First and foremost - staying safe!
If you are a homeowner, you need to get on our home equity update email. When there is any real estate activity in your neighborhood or on your street, I notify you.
If something is listed for sale, you get an email from me showing the amount with all of the other real estate information pertaining to that home.
If there is a home in your neighborhood that successfully sells, you will get that notification directly from me.
I have also engineered these Equity Updates to reflect distressed homes and price changes and reductions that occur in the neighboring homes that are listed for sale.
Now, as I state this, my system for equity updates is not something that is going to send you every listing in a particular zip code. I get my intel and send it directly to my real estate owners for homes that are within close proximity to theirs. I also make sure that I'm builder specific and the homes you are being advised about are from the same home builder and match the styles for your exact tract of homes.
I will only update you as far as the other Island homes in Bridgeport and all of their real estate activity.
What should you be doing now? Homebuyers:
First and Foremost - Staying Safe!
If you are a homebuyer that was interrupted by the Coronavirus, now is not the time to panic.
Take care of those closest to you and yourself.
If you had a type of home in mind with a price range, you can keep up with the current inventory and housing prices at our Santa Clarita home expert's website.
Do yourself a favor, keep your finances solid and try not to open any new lines of credit unless absolutely necessary.
Sometimes opening additional credit lines can impact your overall FICO score. That FICO score will become very important when it comes to being approved for home loans. If buying a home is part of your plan and if you want to continue with that plan when this mess is over, then you will want to keep your credit in the best shape possible.
Also, if you are going to need to defer any of your upcoming payments when you call the creditors and obtain their permission to miss or delay payments get that agreement in writing if possible.
Get it in writing of what you agreed to and that you are not going to be harmed in any way by electing to participate in their agreement.
For example, if they are going to give you three months without having to make payments, ensure they are not going to hit you with late fees or report you as being late to the credit bureaus. You may be wondering why I would tell you this when you received their blessing to miss the payments. That is because most of these massive entities have automated systems in place that will report you for missing a payment, even one that was allowed to be missed by the entity themselves.
It's an automated system and does not require a human being to hit the late button. The computer does it automatically. Getting this repaired at a later date is going to pose to be very difficult.
The same will apply with a late fee which has its origination with your creditor. The same computer algorithm will be at work. It will automatically report you when you have exceeded the timeline for payment. Even though you have an agreed-upon revision to the original terms of your agreement, the computer is still going to go forward with its primary programming.
Ask the right questions and make sure you get the answers in writing, if possible. If not, take great notes with times, dates and the employee numbers and names of those with whom you spoke with and in what exact department they are working.
Time will tell and that time is coming
Santa Clarita seems that we are going to be shut down until the end of April 2020 at least until that time.
There is no word on when the powers that be opine as to when the coronavirus numbers of infected will peak.
When that happens, then they may be able to give a more accurate number as to then the "quarantine" will be relaxed or removed altogether.
When they remove it, there will probably be a bump in the numbers of those who have the virus and the number of deaths.
I hope they have a cure or vaccine at that time.
With real estate in the Santa Clarita Valley cities, I don't see an overwhelming number of homes entering the real estate market for sale.
A lot of people just did a refinance and most of the lenders that are holding mortgages are willing to extend those contracts for a few months without any other justification except asking for it.
When you are ready, please reach out to me directly. I'm local, I'm real and I'm ready to help you with all aspects of your future real estate endeavors.
I'm Connor, just google me or the Santa Clarita home experts to see us or punch in Santa Clarita blog to read about the local housing market and find out the information you will need to make the best home purchasing or selling decisions.
Talk soon and thank you for sharing and taking the time to read our latest real estate market update for the Santa Clarita Valley cities.