Category: Price Analysis

Here are the latest sales numbers for all homes sold within the City of La Quinta as well as all Golf Course homes in La Quinta from January, 2008 through May, 2013.

We continue to have the same “new” problem, a lack of listings to sell. Even the summer months are busier than years past. Here is an idea of how tight inventory is. Normally a gated community has 10% of the homes available for resale. Here are the stats for 3 La Quinta communities:

Mountain View CC: 426 homes, 22 for resale – 5%
Rancho La Quinta CC: 960 homes, 31 for resale – 3%
Citrus Club: 576 homes, 6 for resale – 1%

Sales volume and price/sqft numbers show upward movement in the months of April and May 2013 compared to the same months in 2012. It will be interesting to see the numbers in the coming summer months as well as into the next season. Will the higher mortgage rates or any other economic factors have adverse effects on turning this positive movement into a real trend for 2013?

Here are some charts showing the present market.

 

 

 

 

 

 

The pink line represents a 4.5% rate of appreciation, which is the historical rate of appreciation (going back to 1968) according to the National Association of Realtors.
 

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 YTD	762	335

* 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.

Source: DesertAreaMLS

Here are the latest sales numbers for all homes sold within the City of La Quinta as well as all Golf Course homes in La Quinta from January, 2008 through March, 2013.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The blue lines represent 2008 data, the orange lines represent 2009 data magenta lines represent 2010, green lines represent 2011 data, purple lines represent 2012 data and the pink lines represent 2013 data.

2013 is turning out to be one of the best years we have enjoyed since 2008. As Realtors, we are faced with a new problem that we haven’t seen in years; a lack of listings to sell. For the last few years, we struggled to get buyers for our listings, now the market has come around 180 degrees. now we are up late at night trying to figure out where we can get quality listings for our buyers.

In recent blogs, I have been mentioning about how, although it is a fact that the Median price of homes is going up, the price per square foot of home has not increased as dramatically. Now we are beginning to see a slight upward movement in the mid priced homes ($500,000 – $800,000) but that trend has not yet affected the higher priced homes. This trend is also the effect or the reduced number of distressed property sales that pull everything down.
I have also included some other charts of interest.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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 YTD	398	170

* 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.

Source: DesertAreaMLS

 

 

Here are the latest sales numbers for all homes sold within the City of La Quinta as well as all Golf Course homes in La Quinta from January, 2008 through February, 2013.

 

 

The blue lines represent 2008 data, the orange lines represent 2009 data magenta lines represent 2010, green lines represent 2011 data, purple lines represent 2012 data and the pink lines represent 2013 data.
Looking at the numbers, 2012 was a good year for real estate in La Quinta and 2013 looks like it will be an even better year. The first quarter of 2013 will be the strongest quarter since 2008.
I’m sure you are aware that the news media is hyping the “rise of the median home prices”. That is a fact. The median price is rising but there is more to the story. The “Median” price is the middle price in the list of prices. That list of prices contains both “normal” sales and “distressed” sales (short sales and foreclosures) which sell at “distressed” (lower) prices. If the number of “distressed” sales dimishes, the median price will move higher up the list but that does not necessarily mean that the prices at the high end of the list have changed at all. The good news is that prices in general have begun to follow the “normal” 4.5% real estate rate of appreciation.

 

The difference in the “Normal” line and the “Actual” line after 2010 is in part due to the distressed sales keeping the overall numbers lower. The drop in the prices in 2011 can be attributed to the number of distressed property sales rising to over 50% of all sales. Prior to 2009, “Distressed” sales accounted for less then 5% of all sales. As the “Distressed” sales become a significant part of the number of sales, they also hold the value of “Normal” sales back because they are used as comparable’s during negotiations and appraisals.

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 YTD	239	98

* 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.

Source: DesertAreaMLS

Here are the latest sales numbers for all homes sold within the City of La Quinta as well as all Golf Course homes in La Quinta from January, 2008 through December, 2012.

 

 

 

 

 

 

 
The blue lines represent 2008 data, the orange lines represent 2009 data magenta lines represent 2010, green lines represent 2011 data and the purple lines represent 2012 data.

Looking at the numbers, 2012 was a good year for real estate in La Quinta. With sales of 1,530 units, 2012 was the second strongest year for unit sales since 2005 (1,563 units sold). 2004 was the best year ever for unit sales in the City of La Quinta at 1,938 units sold.

 

 

 

 

 

 

 
Golf Course home sales in La Quinta.

Like the sales numbers for the entire city, the sales-volume numbers (587) in the higher-end market (which contains many of the golf properties in the chart above) were also the best since 2004 (785).

The number of “distressed” (bank owned and “Short Sale”) properties has decreased from 46.0% of total sales in 2011 to 31.9% in 2012. This is especially impressive when the total number of sales in 2012 increased by 5.8% over total sales in 2011. Here are the sales figures from 2006 through 2012 showing what an important factor distressed property sales played in overall La Quinta sales picture:

Year:	2006	2007	2008	2009	2010	2011	2012
Total Sales	1,118	942	1,076	1,202	1,360	1,446	1,530
Distressed Sales	5	40	366	605	623	665	488
Distressed/Total	0.45%	4.25%	34.01%	50.33%	45.81%	45.99%	31.90%

From 0.45% of sales in 2006 to 50.33% in 2009, you can easily see why “distressed” sales have played such a big part of home sales pricing. Recently, the Desert Sun newspaper had a headline stating that the median home price had risen 31%. This is not hard to accept when you replace a significant number of lower priced distressed sales with higher priced regular sales. Lessening the impact of the distressed sales is good for everyone.

Here is a chart of the number of home sales in the City of La Quinta since 2000.

 

 

 

 

 

 

 
We are gradually coming back from the low in 2007 on a steady upward trend. The outlook seems to be improving as we are seeing the return of developers and a significant increase in new construction.

The famous bubble.

A lot of our current economic troubles have been blamed on the “Real Estate Bubble” which “popped” in 2006.
In 2005, an article published by the National Association of Realtors spoke about the “bubble” and how it represented a lack of value in the inflated home prices of the time and that people would soon realize that the inflated home prices did not represent the actual value of the home and the bubble would implode. The article went on the say that for as long as the NAR had been recording it, Real Estate appreciation had risen at an annual rate of 4.5% and that when the bubble broke, prices would come back down to meet that normal appreciation line.

 

 

 

 

 

 

 
Price per square foot of home sold from 2000 to 2012 in the City of La Quinta.

This chart shows the “Bubble” as sale prices departed from the normal line in 2002 and returned to it in 2009 as predicted by the NAR. What the NAR had not predicted was the number of distressed properties that would come into the market place and the significant affect they would have on the sale price of regular sales. If the number of distressed properties continues to shrink, we should see the actual price line come up to the “normal” appreciation line in the next year or two or maybe we need to establish a new “normal” line.

Overall, we continue to see more positive signs in the market place and the media continues to be encouraging. We are anticipating a good year in 2013. The mortgage industry is the best it’s been for conventional loans and even the “jumbo” loans, are becoming easier to get..

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	1,530	587

* 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.

Source: DesertAreaMLS