The City of La Quinta, home sales for the year 2015 are 1.9% lower than 2014 with the second half finishing better than the first. This may have been because the announcement and press coverage of the state’s drought condition was new and plentiful and was a concern to a significant number of potential buyers. The fourth quarter of 2015 was 22% higher than the fourth quarter of 2014. We started 2015 with a tight inventory of homes for sale which is a major contributor to the decrease in sales throughout the first half of the year. When compared to 2014, sales picked up through the summer months which brought 2015 sales closer to those of previous year.
Even given the above information, as far as prices go, the average price per square foot rose 3% in 2015 over 2014. However, we must note that 2014 prices were below the annual average of the last three years.
As everyone is saying currently, we have noticed here in the Coachella Valley that since the fall of the Canadian dollar in 2013 and the first quarter of 2014, there has been a noticeable decrease in the number of Canadian buyers. After the crash of 2008, the Canadian dollar rose to be more valuable than the American dollar which spurred on the Canadian buyers. Since 2011, the Canadian dollar has returned to a more traditional level which means that a Canadian buyer would need close to one million Canadian dollars to purchase a $700,000 home in the U.S. So, this is definitely one factor in our current slow down but certainly not the only factor. The Canadian market was never 90% of our sales so we cannot simply blame this slow down on that one factor. Unfortunately, the current state of the world economy, the down turn of the stock market, and the large inventory of homes for sale that keeps growing have all contributed in turning this into a buyer’s market.
This is a graph of the Real Estate “Bubble”. The red line represents the normal historical Real Estate appreciation rate of 4.5%
In January, the inventory has risen significantly and here are some numbers showing the age of that inventory. A 6 month inventory is considered normal. More than 6 months is considered a “Buyers” market and less then 6 months is considered a “Sellers” market.
Here are some yearly sales figures (units) for the City of La Quinta from 2002:
Year – All LQ – Golf Course
2002 – 1,356 – 259
2003 – 1,572 – 640
2004 – 1,938 – 785
2005 – 1,563 – 638
2006 – 1,118 – 483
2007 – 942 – 444
2008 – 1,076 – 405
2009 – 1,202 – 409
2010 – 1,360 – 518
2011 – 1,446 – 510
2012 – 1,532 – 587
2013 – 1,537 – 567
2014 – 1,284 – 576
2015 – 1,259 – 512
* Remember that the sales numbers represent “Closed” escrows. Since the average escrow is between 45 and 60 days, the decision to purchase the homes that closed in June was probably made in March to early April.
For more information about the Coachella Valley Real Estate market,
Please call us at (760) 203-2621!