By Bruce Cathcart
This year February allowed Coachella Valley residents to enjoy day after day of clear skies and sunshine with daily temperatures in the mid 80’s while we watched the Midwesterners and East Coasters get pounded with an arctic blast and one snowstorm after another. You would think it would be impossible to keep those poor folks from coming our way… but for one reason or another this season is just a little off for us so far this year.
In last month’s article I wondered if our Coachella Valley real estate market could sustain the slow but sure recovery process from the great recession without the aid of foreign investors due to the US dollar reaching new highs against most foreign currencies. I thought we would just have to wait and see since; after all, we were enjoying significantly reduced gas prices and near historic low interest rates on home mortgages. Between first time home buyers, boomerang buyers and baby boomers, the three groups most likely to benefit from these savings, we surely should be able to sustain our local recovery. What a difference a month makes as I just paid $3.45 for a gallon of regular gas and interest rates have slowly crept up over the past two weeks! Could this be the perfect storm in the making for the Coachella Valley Real estate market? Let’s take a look at the data for last month’s sales and see how we are doing.
According to the Desert Area MLS (as of 03/01/15) there were 888 pendings of residential properties here in the Coachella Valley in February. There were 801 pendings in the previous month (January) which means activity is up slightly following our normal seasonal sales pattern. Checking the pendings from February last year (2014) we had almost exactly the same number at 900 for the month. Unfortunately last year’s activity was off 11% from the year before and so staying the same is not an improvement in the overall trend necessary for our market to recover. If anything, it represents a pause while the market decides which way to go, up or down. Checking the actual sales, in January there were 555 solds and in February there were only 546 solds. Not only are the solds down (slightly) from the month before, but they are also down from February 2014 where there were 575 solds. This month over month and year over year drop in sales suggests that 2015 is not off to a very good start. Our inventory of homes for sale was up again slightly to 5,099 as of March 1, 2015 compared to 4,971 at the beginning of February. Whatever is holding our market back, it is not a lack of inventory. Before we make any predictions this year we will have to see the numbers for March and April, usually two of our strongest months of the year for sales.
My real estate tip this month is to use the services of a local Real Estate Broker or Agent when selling your property. Acting as a Trustee for my mother-in-law’s estate, I was charged with the duty to sell her home located in Orange County. Since I have been a real estate professional for approximately 33 years now and with all of the data sources available in this computer era I figured that I could accurately value, list and sell the home myself; after all, it was only 90 miles away! I did my research and came up with a number I that I thought the house would sell for in the current market. I then followed my own advice that I had given my readers in an article I wrote two years ago and I interviewed 3 local agents based upon referrals from folks I trust. One agent’s opinion agreed with my own, but two of the agents suggested a value $125,000.00 higher than I thought possible. Of course I challenged their value but in the end I listed the property with the agent who did the best job of supporting all the reasons why he believed that HE could sell the home for the higher price. You know what? He did it, and I am so happy that I went with a local agent. As a Coachella Valley real estate broker I see properties listed all the time here in our local market by what we call “out of the area” agents. Occasionally they get it right, but usually they are either way too high or way too low. In either case they are doing their clients a disservice. Don’t allow this to happen to you! If you have a friend or family member with a real estate license (and who doesn’t!) who does not specialize in sales in the area that your property is located in, allow them to help you by asking them to “refer” you to a local real estate professional. Both you and they will profit from this arrangement.
Join me each month this year as we keep a close eye on our Coachella Valley real estate market. If you have a real estate question or concerns please email me at the address below.
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.