By Bruce Cathcart

With the sweep of a witch’s broom and just like that Halloween and the month of October 2018 are behind us.  It was 31 days of near perfect weather for enjoying all that the desert has to offer and to prepare for the annual return of our beloved snowbirds who come from all parts of the world with a joyful enthusiasm that reminds us all just how lucky we are to make the Coachella Valley our home.  Of course they also bring with them those wonderful tourist dollars that keep our local economy going along with increased traffic and sometimes questionable driving skills!

By the time this article goes to press the midterm elections should be over and with them the barrage of negative campaign ads and misleading news items designed to favor one political party over the other.  Each year the pre-election anxiety seems to get worse paralyzing home buyers and sellers into inaction and causing market sales to dip.  California housing sales data from the month of September 2018 showed that this year’s number of housing sales has dropped as much as 18% when compared to September 2017 sales.  This one piece of sales data became the subject of numerous news casts, articles and blogs about how the Real Estate Housing Bubble II is getting ready to burst.

In this week’s article I will try and make some sense of the statistics and sales data to see if there is any truth to these dire predictions about the impending burst of the Housing Bubble II.  But before I get to that, let’s take a look at the housing sales data for the month of October and see how our own real estate sales market here in the Coachella Valley is doing. 

According to the Desert Area MLS as of 11/1/18 there were 766 pending transactions (homes that went into escrow) of residential properties here in the Coachella Valley in the month of October.  That follows our seasonal pattern of being back up from the 646 pendings in the previous month (September).  In September there were 708  solds (closed escrows) and again, following our seasonal sales pattern, we were back up in October with 756 solds, which by the way is actually higher than the 742 homes sold in October 2017!  Once again, October’s sales were able to maintain our lead over last year’s sales with our year to date solds for 2018 at 8,939 compared to last year’s total sales of 8,881.  These statistics show that the Coachella Valley real estate market is NOT going the same way that most California real estate markets are now trending with fewer sales than the year before.  Looking specifically at the Coachella Valley September sold statistics, we actually showed a 6% gain when compared to number of homes sold in September of 2017!

This month our inventory of homes for sale went up again with 3138 homes available on November 1, 2018 compared to 2,839 homes available on October 1, 2018.  Last year at this time we had 3,601 homes available for sale.  This increase in inventory is seasonal and expected and it is closing the gap between our inventory of homes available for sale at this time of year when compared to last year’s inventory of homes for sale.  Just a reminder here, last year’s housing sales and dollar volume was the Coachella Valley’s BEST YEAR since 2005-6 and 2018 is still on track to beat last year’s numbers!

Take a 40 year old Bachelor’s degree in Economics from UCI and add 36 years as a full time real estate agent/broker here in the Coachella Valley and you are bound to get an opinion that runs contrary to the sensationalized headlines in the media… especially when it comes to real estate matters.  When we were in the depths of the “great recession” the self-proclaimed experts in the media told everyone that it was the worst time to buy real estate when in fact it was the absolute BEST time to buy real estate.  Now with a robust economy, as close to zero unemployment as this nation will likely ever see, interest rates averaging 4.83% (40% lower than the 45 year average interest rate according to Wells Fargo), and based upon one month’s sales data a typical recent headline read, “In California, Home Sales Are Plunging Like it is 2008 All Over Again” (  The implication of which is that the Housing Bubble II is ready to burst and that now is NOT a good time to buy or invest in real estate.  I disagree.  Barring a “black swan” event, there is no reason to believe that a real estate housing bubble even exists at this time let alone is preparing to burst.

It is true that several California real estate markets have over-heated; specifically these markets include Los Angeles, San Francisco, San Diego and Orange County.  All of these are large, affluent, desirable areas where demand for housing has driven prices far beyond the former highs set in 2006 and people have paid ridiculously high prices for housing.  As prices continue to increase and with the Federal Reserve aggressively raising interest rates demand eventually begins to fall and as this happens the number of sales decreases and the amount of inventory increases.  At this point the prices start to come back down.  This is Econ 101 and in laymen terms, the over-heated market “cools down”.  How is this different than the burst of housing bubble I?  For one thing the “heart beat” loans, 1% interest only, deferred interest and re-set loans accompanied by “predatory” lending were eliminated over 10 years ago.  Homeowners actually had to qualify to purchase the homes they now own mostly with fixed rate mortgages at historically low interest rates.  And I think I mentioned that anyone who wants a job can find one so while there will always be foreclosures due to circumstances beyond a homeowner’s control, the odds are against another catastrophic event taking place like in 2007-8.  This is a traditional or “normal” market.  It has been so long since we last experienced one like it that it appears that only we old guys can remember how it actually works!

For now those of us lucky enough to live and work in the Coachella Valley are experiencing one of the best years in the last 13.  Our housing prices still have not fully reached the highs we set back in 2005-6 and our inventory is keeping pace with our sales.  If you are ready and able to purchase a home here in the Coachella Valley do not be misled by dire predictions of a bursting Housing Bubble II. Get with your trusted real estate professional and let them help you realize your real estate goals and dreams while you still can.

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 or visit his website at