Housing market struggling

San Fernando Valley Business Journal, Sept 29, 2008 by Mark R. Madler

The median home price in the San Fernando Valley dropped by 35 percent in August when compared with the previous year, according to a report from California State University at Northridge.

The median price was $420,000, a drop of $33,000 when compared with July. In August 2007, the median price was $650,000.

The school's San Fernando Valley Economic Research Center also found that August home sales of 1,188 had dipped by 5 percent from July but that sales were still higher than at any other time of the year.

The center forecast that a combination of the uncertainty in the credit and mortgage market and the slow job market in the state contributes to a drag on near-term home sales.

Notices of default were up in July and August but were still lower than the 1,560 recorded in April. A year ago August, there were 833 notices of default (NOD).

NOD's take about 100 days to turn into foreclosure if the delinquency is not resolved or the home loan renegotiated.

The high level of default notices will continue the record pace of foreclosures in the Valley because homeowners fall behind on payments or cannot renegotiate their loan because of the tight credit market.

In August, 923 foreclosures were recorded in the Valley, a more than 200 percent increase from the 289 foreclosures in August 2007, in line with the rest of L.A. County.

By MARK MADLER

Staff Reporter