Indian Ridge CC 2010 3rd Quarter Report
Dear Indian Ridge Resident:
The growth in the national economy has slowed with no foreseen change in the immediate future. Despite the media’s cover-age filled with doom and gloom, there are several items that could bring positive job growth. The retail inventories are low and must be restocked. The private sector is expected to move towards a positive number which would encourage consumer confidence by late this fall. The corporate cash position increased by 26% from 2009 to over $2 trillion. Once the companies know how much money government is going to take, they will know how much they can afford spend to expand their busi-ness and then the job market will begin to see positive growth. Interest rates and money policies are not expected to change for at least the next 2 to 3 quarters. It appears the ‘cap ‘n trade’ bill is dead and with that death, the regulatory demands should be minimal, offering greater stability and predictability to the business community.
On the lending side, Freddie and Fannie have established limits for loans originated in 2010. The highest is $729,750 for counties such as Orange and Los Angeles. Riverside has been set at $500,000.
It is expected that Freddie and Fannie will be getting tougher on lenders who are taking too long to reclaim vacant homes after all foreclosure alternatives have been exhausted. This banking procedure has historically taken far too long and history shows how this inefficiency has affected home values. Mortgage services that collect fees from Fannie could face fines if the process is unreasonably prolonged.
The ‘shadow inventory’ which are loans at least 90 days delinquent sits at around 4 million. With banks having taken so long to respond to short sale offers and at times selling the property as a foreclosure at a lesser sales price than the short sale offer, the penalty these lenders may incur as a result of undue delay may work as a positive with regards to future distressed sales.
Nationally, the existing home sales for July were dismal, dropping 27.2% compared to June of this year, primarily due to the end of the housing credit program. Days on market rose from 8.9 month in June to 12.5 months in July. For the month of Au-gust, the drop in sales nationwide was down 19% from August of 2009. Home prices remain flat. Once the job growth in-creases the effects on the housing market will see more positive growth.
The real estate sales in California were down 10.9% in July compared to June. August was off 9% in sales from August of 2009 according to Data Quick (county sales) and down 13.5% when using the multiple listing service. This is less severe than the 19% decline nationwide. The statewide median price of an existing home increased in July to $314,850 compared to June of 2009. According to Data Quick who uses county records shows 209 of the 352 cities and communities in California had an increase in median home prices from a year ago. The cities and communities considered had at least 30 recorded sales or more. The California Association of Realtors reported a 3.6% rise in the median price to $175,140 in August, compared to $168,080 a year ago.
The median price of desert homes sold in August was $181,000—a 4% drop from a year ago. This would indicate we are above the state average of $175,140. This drop would certainly make sense with the fact that 71% of the August sales were distressed properties. There were 1083 homes sold in June, 819 sold in July and 730 sold in the month of August. The inven-tory of homes for sale has remained fairly steady with about 5500 actively listed homes. This is historically low considering there were approximately 9593 homes on the market in November of 2007.
Days on market in the desert varies depending on the asking price of the home. Homes asking more than one million dol-lars are at a 10.4 month supply. The homes asking under $300,000 are at a 5.1 month supply. Homes under $500,000 were at a 3.3 month supply back in July of 2009. Sales for high-end homes in Palm Springs and surrounding communities are making a comeback after two years of double digit declines. Sales for high end homes in the Coachella Valley are up 65% in 2010 compared to 2009. While still difficult, we are seeing positive movement.
The Coachella Valley total home sales evaluation shows positive sales year to date compared to previous years. To date total sales for homes under $500,000 are already 98% of the total 2009 sales. Homes selling for more than one million are up 14.4% higher than last year.
On the attached report comparing country clubs, 7 of the 11country clubs have either equaled or sold more homes in 2010 than in 2009. Three of the eleven communities have shown an increase in average price compared to a year ago: PGA West, Palm Valley and Indian Ridge. The increase may be a result of an increase in sales of the more expensive properties.
In Indian Ridge, 53 homes have sold to date for this year. Last year a total of 33 homes sold so we are well past last year’s sales. The number of homes sold in the third quarter for 2010 were 13 compared to 7 a year ago and 5 in 2008. The aver-age price per square foot has shown a slight decline due to distressed sales activity. I have included the list of the homes sold this year with more detailed information about each property. While the market continues to be price driven, the in-crease in comparables helps determine more accurate listing prices and actual selling prices closer to the asking price. Homes are getting easier to appraise due to the increase in the number of sales.
Please feel free to contact me if you have any questions or concerns or just to talk about what is happening in the real estate market locally and throughout the Coachella Valley. My knowledge base of all country clubs in the desert gives me the opportunity to help find just the right club and home for those wanting to make this valley their home.
Please click the link "View PDF Document" located under my photo to view a printable version of the entire report.
We look forward to seeing you once again as another wonderful season is just around the corner.
Associate Broker/Executive Premier Director
Windermere Real Estate
Information is compiled by Diane Williams using multiple resources including the NAR, CAR, LA Times, Desert Sun, Wall Street Journal, John Sey-mour’s “What’s Hot What’s Not”, and the Multiple Listing Service. If your home is currently listed with another Broker, please disregard. It is not our intention to solicit other Broker’s listings.