Indian Ridge CC 2009 1st Quarter Report
Dear Indian Ridge Resident:
We are now past the first quarter of the third year in this down market in real estate. Sales remain slow as buyers continue to believe we are not yet at the bottom and have no sense of urgency in making a purchase. Recent reports indicate we are beginning to stabilize. California home values have been stable for the past 3 consecutive months.
The California Association of Realtors predicted an increase in sales for both 2008 and 2009 as the market absorbed the distressed sales. The impact of the pile up of foreclosure, REO’s (real estate owned) and short sale properties will continue until the mortgage problems subside in the second half of 2009. Approximately 19.8% of the sellers sold their property because it was a foreclosure, REO or short sale and 1/3 of the homes sold were distressed sales. There were twice as many REO sales as short sales. This is brought about by banks slow to respond to short sale offers, giving buyers time to find more readily available properties for the same price or less. Foreclosures accounted for 55% of all sales in March in Southern California.
California existing home sales increased 100.8% in January of this year. The median price decreased 40.5%. Unsold inventory dropped from a 16.6 month wait to 6.7 months. The average days on market for homes in the desert over $500,000 averaged 4 months. Palm Desert East where Indian Ridge is located, averaged 8.5 months on the market. Indian Ridge averaged the same number of days. This was the highest days on market rating for any of the areas in the Coachella Valley.
Southern California sales increased 52% for March (19,486 homes sold) compared to 12,808 in March of 2008. March was also the 9th consecutive month with over-the-year sales increases.
California Desert Association of Realtors shows home sales in the Coachella Valley increased 69.6% from February 2009 compared to February a year ago with a decline in median price of 53.4%. These declines are primarily in the low end of the market, but this percentage thrown out randomly without clarification often leads buyers to believe they can purchase higher end homes for prices well under the asking price.
For the first quarter of this year, real estate sales in the Coachella Valley remained at the lower price range with 88.5% of the homes sold under $500,000. Homes under $250,000 represented 66% of the market, homes over $250,000 represent 34%, homes over $500,000 represented 12.2% and $1 million+ properties represented 3.1%. There were 35% more homes sold in the 1st quarter of 2009 compared to 1st quarter of 2008. Sales of homes over $250,000 is down from last year. Homes sold this quarter over $500,000 were 226 compared to 428 a year ago. Homes sold over $1 million were 138 in the first quarter of 2008 to 58 this past quarter.
What will it take to shift things around? Either sellers will have to further reduce their prices and/or buyers have to lose the home they truly wanted as more aggressive buyers step up to the plate and make the purchase. We are beginning to see multiple offers on some properties where buyers see great value. Total monthly sales continue to rise. Windermere bank owned sales have dropped from over 50% of the total sales to 38% as more and more people find better value in homes that are not short sale or bank owned. The advantages: quick close, better condition of property and no need to wait for the bank to respond to the offer. The biggest reason for repeat buyer sales: desire for better/other location (21.2%) wanting a larger home (19.5%), and 18% buying for investment and tax considerations.
Listed below are the sales various country club communities for this quarter. Included on a separate page is the breakdown for homes pending and sold in these golf course communities. The four highest price per square foot communities are Indian Ridge, Mountain View, Rancho La Quinta and Morningside.
Country Club Total Sales Median
Indian Ridge 9 ( 2 pending) $ 625,000
Mountain View 17 (11 pending) $1,101,500
Rancho LaQuinta 21 (12 pending) $ 740,000
PGA West 49 (20 pending) $ 530,000
The Lakes 9 ( 2 pending) $ 500,000
Palm Valley 16 ( 7 pending) $ 350,000
The Springs 9 ( 4 pending) $ 490,000
Morningside 6 ( 3 pending) $ 940,000
Mission Hills 10 ( 5 pending) $ 273,000
Indian Wells 15 ( 7 pending) $ 511,250
Desert Horizons 10 ( 6 pending) $ 530,000
Ironwood 13 ( 6 pending) $ 490,000
Additionally, I have included in this mailing homes currently on the market in Indian Ridge and the list of those properties on the market January, 2008. Compare the two to see the price reductions for the various floor plans from just a little over a year ago.
This is truly the best time in our history to purchase a home. Interest rates are below 5%, prices are down to 2002-2005 prices (depending upon the market area) and golf club initiation fees are the lowest in years. Projections predict that by the second half of 2009, the market will have leveled off and we may be in a more equal playing field as the ‘buyer’s market’ days are drawing to a close. Equally as important is with the increase in government spending for ‘bail outs’ and such, loans to cover those debts will require incentives to the investors in the way of increased interest rates. With these expenditures, inflation will occur. So waiting to purchase a home for less just may cost the same or more down the road for buyers who wait.
Of the 9 homes that have closed escrow this year, I have sold 3. While I would like to see more movement, I remain at the top of the industry and continue to represent many buyers and sellers. I have 30 homes actively listed or available in Indian Ridge. If you have buyers interested, please give them the attached list for their review.
I thank you for your referrals and continued support.
Diane R. Williams
Associate Broker/Executive Premier Director
Windermere Real Estate