Feb 9, 2022
The last two years have been anything but normal for the real estate market during the pandemic. Across the nation, home prices have appreciated by double digits due to the perfect storm of high demand for housing, low inventory, and super low mortgage rates. During this time, California mirrored the national trend especially in more affordable, outlying suburbs and in smaller metro areas like the San Fernando Valley, Santa Clarita, and Simi Valley.
Here, our community has experienced significant growth in the number of new homes that have been built over the last few years that have brought new families to our community. The Vineyards Shopping Center opened in late 2020 offering much needed restaurants, retailers, and entertainment to the local area. All this has continued to make Porter Ranch the most desirable area in the valley, which is supported by the recent sales data taken from the MLS.
In 2021, the average sales price for a home in Porter Ranch increased 23.6 percent, from $1.05 million in January to just over 1.3 million in December. For the months of March and April, the average sale price only appears to have decreased due to a higher number of condo/townhome sales versus homes. Yet, the average price per square foot continued to increase in those months which means that buyers were paying higher prices for those units. Overall, both increased almost in lock step, even though price per square foot ended the year with a slightly higher appreciation of 24.1 percent.
Additionally, we saw increased activity in the number of sales coupled with a decrease in number of days on market (DOM). There were a total of 350 purchases in the community last year, which are a combination of new home deliveries, as well as resales. That’s almost one home per day!! As expected, July through October were the most active months with just about half of the transactions (170) being done, and with the lowest DOM of 12.5 days in August. As we ended the year, the number of sales were still going strong though there was a slight increase in DOM.
So where do home prices go from here? No one can say for sure, but all signs are pointing to a more normalized growth rate in home prices for the coming year. Current economic forecasts are projecting a range of 5 to 12 percent appreciation in 2022, even when considering that the Federal Reserve in December pivoted their policy to raise benchmark rates at a quicker pace than previously expected.
With inventory remaining tight and qualified buyers looking to move to Porter Ranch, there is no indication that home prices in the area will decline any time soon. Based on the data, I hypothesize home prices will increase an average of 7.5 percent this coming year in Porter Ranch.