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Thursday, Sep 28, 2023


valley econowatch/dy/mike1st/mark2nd After bottoming out last October, Valley home prices appear to be inching their way back in this month’s issue of Valley Econowatch. However, that upward movement will be kept in check for the foreseeable future by a steady stream of foreclosed homes still coming onto the market, according to Valley real estate experts. The nascent turnaround is reflected in Econowatch’s repeat home sales price index over the last three months. The index is compiled by Experian, which calculates the prices that homes sell for compared with what they would have sold for in the benchmark year of 1990, when the index equaled 100. The most recent repeat home sales index of 73.6, for January, means a home that sold for $100,000 on Jan. 1, 1990 would sell for $73,600 in the present market. After declining for much of the past year, the repeat home sales index appears to have bottomed out last September at a 68.9. Since that time, the index has been inching back up. Much of the boost in the index is coming from home sales in the $200,000-and-under range, according to Mel Wilson, owner of residential real estate brokerage Mel Wilson & Associates of Northridge. “We’ve been getting multiple offers on properties below the $200,000 range in the last five months. Below $200,000 is where it’s happening,” Wilson said. As an example he cited the case of a $110,000 bank-owned house that he sold less than two weeks ago. Two offers were made on the property within three days of it coming on the market, both below the asking price. When the two prospective buyers found out they were bidding against each other, both raised their offers to the asking price. “The (houses) that are in good condition and less than $200,000 are probably staying on the market less than 30 days now,” said Wilson. By comparison, the same homes would have stayed on the market closer to 90 days a year ago, he added. Wilson said brisk activity in the $200,000-and-under range could also breathe some life into the $250,000-to-$500,000 home range later this year, as trade-up buyers sell their cheaper homes and move up to more expensive units. He predicted the Valley home price index will continue to inch its way up in 1997, gaining as much as 5 percent for the year. But the larger number of bank-owned properties still coming onto the market should keep the index from breaking the 5 percent barrier, Wilson added. “Over 20 percent of our sales are still foreclosure properties, and that’s dragging down prices. According to the big institutions, there’s still lot of material in the foreclosures loop that’s not on the market yet,” he said. Douglas Young

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