BY BRUCE CATHCART
Winter finally showed up here for a few days at the end of February with low temperatures dipping all the way down into the 40’s and a light dusting of snow was visible on Mt. San Jacinto from the valley floor. I guess that was it though, as we roll into March our perfect weather has returned with high temps in the low 80’s and just like that the busiest time in the desert is upon us. Art and Music Festivals, Tennis and Golf Tournaments, hold onto your hats folks because here we go! It is also at this time of year that most of us get around to seeing our tax accountant and for those of you who do not already own your own home be prepared for the annual lecture of “You need to buy a house… it will save you on your taxes!” Even with the new tax laws that will take effect next year, owning your own home will likely still save you money on your taxes. The tax deduction for home mortgage interest (on loans up to $750,000.00) has been preserved as well as deductions for limited state and local taxes. When combined these items should easily exceed the automatic minimum deduction allowed under the new laws. So if this is the year that you are finally going to turn that tax return into a down payment on a house then NOW is the time to contact a lender and get “Pre-APPROVED”! How do you find the right lender? I’ll get into that in just a moment. But first let’s take a look at the sales data for homes in the Coachella Valley for the month of February.
The National Association of Realtors announced in an article last week that nationwide pending sales in January were at a three year low corresponding with slightly higher interest rates and very low inventory levels. We know from last month’s article that this is NOT the case here in the Coachella Valley as our January pending and closed sales continue to exceed the previous year and continue our three year trend of more home sales at higher prices. Is it possible that our February sales will continue this trend?
According to the Desert Area MLS as of 3/1/18 there were 1,186 pending transactions of residential properties here in the Coachella Valley in the month of February. That’s back up from the 973 pendings in the previous month (January) and considerably higher when compared to the same time last year when we had only 969 pending sales. This continued increase in sales activity over last year’s numbers bodes very well for a continued trend of a higher volume of sales in 2018. In January there were 683 solds and we were back up in February with 714 solds. That is still slightly better than last year’s home sales in February (2017) when we sold only 710 homes. Our Year to date solds for 2018 stands at 1,442 compared to last year’s total of 1,346. Despite sales totals being down nationwide, here in the Coachella Valley we are off to another great start in 2018 with both more contingent/pending sales and closed sales than last year.
Our inventory of homes for sale went down this month with 3,846 homes available on February 28, 2018 compared to 4,009 homes available on February 1, 2018. Last year at this time we had 4,929 homes available for sale. If this trend continues it could create problems for future sales as the lack of inventory will definitely have a negative effect on the number of sales as it already has in the rest of the country. So far, so good for now! We’ll just have to keep a close watch the inventory of homes here in the Coachella Valley and see how it affects our sales numbers throughout the coming months.
In today’s high tech Internet oriented world buyers have a lot of options when it comes to selecting a lender to help them through the process of financing the purchase of their home. One on-line company (rhymes with “spending spree”) promises buyers that several lenders will be competing for their business. Buyers should be aware that this company is just a data base server and that they sell your contact information to lending companies all of whom will be contacting you and contacting you and contacting you… like you don’t already get enough spam! I have had both good and bad experiences with another popular internet lending company (rhymes with “stick’n stones”). The problem here is you get stuck with whoever responds to your inquiry. That person could be the most experienced, best loan officer in the company or the least experienced, worst loan officer in the company. Unfortunately you don’t know which one you got until it’s too late and the SHTF. My advice to buyers is to pick your real estate agent first! Your trusted real estate professional will guide you through the entire process of purchasing a home which starts with helping you to select the right lender. Over the past 36 years I have done thousands of transactions with financing involved and I know that helping my clients to find a lender that is honest, experienced, patient and that can get the job done is the key to any successful transaction. In fact, the first thing I do is arrange a meeting with my buyers and a lender to get them pre-qualified for a loan. Pre-qualified is not the same thing as pre-approved. Getting pre-qualified involves a credit report and is based upon the information that buyers verbally share with the lender. It does not involve the verification of that information. Getting pre-qualified is an opportunity for buyers and lenders to meet face to face where buyers can not only share their financial information, but they can ask questions about types of loans, interest rates, loan amounts, down payments and monthly payments. At the same time they can “get to know” their lender and see if this is a person that they feel comfortable working with… after all, they will be putting their trust in this individual to help them make what will likely be the largest investment of their life! If for any reason the buyers have any doubts or concerns about this lender their trusted real estate professional will recommend another. However, If this first meeting goes well then the buyers will asked to submit the necessary paperwork (like tax returns, paystubs, bank statements, etc.) to the lender so that they can begin the pre-APPROVAL process. Once the lender has all of the necessary documents it only takes a few hours for them to issue a “Pre-approval Letter”. At this point the buyers should have a good understanding of the financing process and be able to begin shopping for a home with confidence! Once a home is located the Pre-approval Letter is submitted to sellers along with the buyer’s offer assuring the sellers that the buyers are qualified to purchase their home at the price and terms included in their offer.
If you think that this might be the year you are ready to buy a home contact your trusted real estate professional and let them help you find the right lender to learn if you are qualified to do so!
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.