La Quinta, CA Real Estate analysis 2014 Year End

The City of La Quinta, unit sales for year 2014 are 16.6% lower than 2013. As you can see from the graph below, each month in 2014 fell behind the same month of the previous year. The fourth quarter of 2014 was the worst with 26.75% less sales than the third quarter of 2013. During 2014, we have had a very tight inventory of homes for sale which is a major contributor to the decrease in sales this year.

The 4th quarter of 2014 was the worst quarter for La Quinta since 2007. The quarter that recently ended recorded La Quinta sales of 230 homes, a drop of 26.75% over the same quarter in 2013 (314). Just to keep this in perspective, 2013 was the best year since the “bubble” burst in 2006.

What we have noticed here in the Coachella Valley was that during the late fall of 2013 and the first quarter of 2014 there was a noticeable increase in the number of American buyers most likely based on the slight improvement in the US economy and a decrease in Canadian buyers most likely based on the devaluation of the Canadian dollar. The number of buyers at that time, coupled with a very low inventory, caused prices to begin to rise substantially in many developments. Toward the beginning of the second quarter, there seemed to be a change in buyer attitude. The Canadian dollar kept declining against the US dollar and the number of American buyers decreased reducing the demand causing prices to level off and even declined slightly. This malaise which has been caused by the tight inventory, and the investors not liking the increase in pricing, has malingered for the rest of the year. We are hoping that after the election and as we enter the selling season, we will see more inventory and then sales again pick up.






This is a graph of the Real Estate “Bubble”. The red line represents the normal historical Real Estate appreciation rate of 4.5%

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 – 1,282 – 576

* 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!

Source: DesertAreaMLS

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