By Bruce Cathcart
As a real estate broker in the Coachella Valley, I love February. It seems most buyers and sellers spend the first part of January recovering from the holidays. By the end of the month and into February all those New Year’s resolutions to sell their home or buy a new one really start to kick in. I know I was crazy busy and most agents I spoke with agreed; 2014 is off to a good start!
The big real estate question on everyone’s mind these days seems to be, “Is the Coachella Valley real estate market on the road to a full recovery?” It is a good question and one that I struggle to answer for my clients nearly every day. Well, here it is March already and the data and statistics for February are coming in with some positive indications for the future.
According to the Desert Area Multiple Listing Service, for residential properties here in the Coachella Valley (including single family homes, condos and townhouses), there were 900 homes that changed status from Active to Pending or Backup Offer. This means that these properties now have a contract on them and have either opened escrow or in the case of the backup offer status are likely waiting for a lender’s approval on a short sale. In January there were only 784 homes that changed status. This is an increase in monthly sales activity of approximately 14% and this is a good thing for sellers. In addition, in February there were approximately 1,036 new listings on the market compared to only 888 in January. Overall inventory available to buyers was up with approximately 4,318 properties currently available for sale. This is a good thing for buyers. While this is just a small slice of the data out there, taken together these factors indicate that the market is moving in the right direction, but predict stability rather than the crazy increase in prices like we saw last year.
March, April and May will tell the story for the Coachella Valley this year. Hopefully sales activity will continue to increase and keep up with the increasing inventory. If it does we will have a “good season” but there are some potential spoilers out there that we have to be aware of. Interest rates are predicted to rise, but so far they have not. See this week’s interest chart below and you will notice that the 30 year fixed rates have remained the same as last month’s and the shorter term fixed rates and adjustable rate mortgages have actually declined. If they do increase that tends to have a negative effect on real estate sales and values here in the Coachella Valley. Will our friends from the great white north (Canada) be back this season and continue to buy their winter/retirement homes here in the Coachella Valley? I hope so but one of the things that made our real estate so attractive to them was that the value of their Canadian dollar to the US dollar. It was worth considerably more over the past two years. Think of how cheap buying stuff in Mexico is for us, that is how it was for the Canadians coming here. But not this year as the values have changed back. Will the baby boomers from Orange County, Los Angeles and San Diego, those that still have jobs anyway, come over the hill and buy their weekender / retirement homes this year? We will just have to watch and see.
In the meantime, if anyone has a spare $34,000,000.00 hidden under their mattress and is looking for the ultimate desert home, that mushroom looking thing in the hills above Palm Springs just came on the market. That’s right; the Bob and Dolores Hope mansion with 10 bedrooms and 13 bathrooms can be bought for approximately $1,455.00 per square foot (a little over ½ acre of house!). No lookie-loos here though, interested buyers must submit financials and sign a confidentiality agreement before making an appoint to view this landmark property.
Looking for something a little cheaper? Of the 575 homes that closed escrow last month in the Coachella Valley 12 of them sold for more than $2,000,000.00 and the winner for highest sale in February goes to a home in the Madison Club in La Quinta for $7,100,000.00. But don’t worry; there are still 251 homes available on the market for over $2,000,000.00 to choose from.
Real Estate Tip of the week: Sellers make sure your trusted real estate agent advertises your home on the internet! Due to polar vortexes, historic snowfall, and record low temperatures January website traffic to real estate sites was up 25% with a total of 364 million visits. If I were freezing my butt off someplace else, I’d be web shopping on the internet for a home right here in the Coachella Valley!
Bruce Cathcart is the Broker/Co-Owner of La Quinta Palms Realty, “Your Friendly Professionals” and can be reached by email at firstname.lastname@example.org or visit his website at www.laquintapalmsrealty.com.