By Bruce Cathcart
Here in the Coachella Valley buyers have the unique opportunity in many neighborhoods to purchase homes that were built starting in the 1930’s and all the way up to brand new construction. Unlike many areas where residential neighborhoods were built out by large tract developers, a large portion of our valley was “mapped” with single family lots which were then built upon by individuals and smaller construction companies over a period of many years (think old Palm Springs, the Panorama tracts in Cathedral City, Bermuda Dunes and the “Coves” of Cathedral City, Rancho Mirage, Palm Desert and La Quinta). The result of this is having homes of different generations, in some cases as much as 50 or more years apart in age, built right next to each other! But which is better, an older home or a newer home? Is it mid-century modern or mid-century junk? Is it a contemporary modern, high efficiency, newer home built with high end components or an overpriced tract home with “builder grade” everything? There are two main truths at work here. First, most home buyers focus on the price and location of the home they want to purchase and second, beauty is in the eye of the beholder. So with these truths in mind, this week I will offer up some general advice that you can use to help you make a good decision when trying to choose between an older home and newer home in the same neighborhood. Before I get to that good advice let’s do a quick check of last month’s sales numbers to see if the Coachella Valley is still keeping pace with last year’s sales.
According to the Desert Area MLS (as of 04/30/16) there were 1,039 pendings of residential properties here in the Coachella Valley in April. There were 1,054 pendings in the previous month (March) still showing good volume, but representing a small decrease in terms of activity for April. In March there were 829 solds and in April we had only 810 solds (another small decrease). Last year in April we sold 870 homes representing a pretty significant decrease in the actual number of homes that closed escrow when compared to the same time last year. Our inventory of homes for sale was also reduced this month with 5,575 homes available on April 30, 2016 compared to 5,780 homes available on April 1, 2016. That correction brings our market back into balance continuing the trend from a buyer’s market back to a Seller’s market. The combination of high pending sales and the reduction in available inventory suggests that we are headed back to a Seller’s market, but decreasing number of homes sold indicates that we are not there yet. I recommend to potential buyers out there to take your income tax refund and invest it in a home before we return to a seller’s market again as we are now certainly headed in that direction!
If an older home has a new roof, new AC, new water heater and kitchen appliances does it matter if it is an older home? The first question I would ask is how old is “older”? The reason is that the older the home the more things I become concerned about. If the home was built in the 1930’s I am worried about the plumbing, electrical, insulation (if any) and structural components of the house… but if the home was built in 1978 these items are things that need to be investigated, but I am not overly concerned about them. Now if the home was built after 1986 I am hardly concerned at all about these items. Here is why. Homes built in the 1930’s here in the Coachella Valley had very little supervision with limited building codes and in many cases inferior components. Earthquake Safety Guidelines and Title 24 Energy Efficiency Standards did not even exist! Over the course of time the County and our Valley Cities adopted strict building codes, (including earthquake safety and energy efficiency guidelines), provided proper supervision of the construction, and building materials and components improved dramatically. The key year for me though is 1986. This was the year when Title 24 Energy Efficiency Standards were adopted that required increased wall and attic insulation, dual glazed windows and higher energy efficient designs and components. Can a home older than 1986 be retrofitted to meet these standards? You bet! And that is exactly what I look for when comparing an older home to a newer home. But going back to our two basic truths… what if you cannot afford to purchase a newer home or what if you can afford it, but really want a home with mid-century architecture? At this point it comes down to the choices available to you. I generally recommend a newer home unless the older home being considered has been substantially upgraded. If you absolutely must have that older architecture then I recommend you factor in the cost of these upgrades when making your decision. As always, your trusted professional Agent can help you with this decision!
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.