Indian Ridge CC 2015 Annual Report
*To view my entire Quarterly Report, please select “View PDF Document” located to the right of this page under my photo.
Another year is over and we are now into an election year. Which party will win the presidential election? What will be happening in the stock market? Where should we put our money? Is this the right time to buy? Why hasn’t my home sold? There are so many varying opinions, it is difficult to determine how the real estate market will react in 2016 as a result of all these concerns. Some experts say we don’t have enough inventory. Some say the new TRID lending regulations are causing delays. Home values have appreciated over the past few years resulting in buyer affordability dropping significantly. While sales have slowed down, prices in many areas have continued to appreciate and the market remains on a slow but steady pace to recovery. This is actually what we considered normal before the big bubble in the real estate market from 2004 to 2006.
Nationally, home prices are about 12% below the all time at the peak of the market in 2006, plus we are up 30% from the lowest period in the real estate market in 2012. In some areas home prices are at or above the pre-recession peak while other areas still have a ways to go in recovering the peak values of 2006. It is estimated that home values will increase 5% in 2016.
According to “Market Watch”, this neutral to slow growing real estate market, in order to recover at a faster pace requires a wage growth from the current 2% to 3.5% and an inflation moving off zero towards 2% plus lending programs making it easier for consumers to get a loan.
California home sales were off 1.6% in November from the previous year and down 8.4% from October showing a big decline from October to November. This is the first time in eight months where total sales have fallen below 400,000 which could be a result of the 6.8% increase in home values or a delay in closings due to the new lending regulations that went into effect October 3rd. The average selling price for a home in California this year was $235,000 up from $230,000 in 2014. Inventory of homes on the market vary depending upon the location of the home within the state. The bay area remains a strong seller’s market with an average price per square foot of $795. The average list to sales price for the state is 98.1% up from 97.4% a year ago.
The desert real estate market overall was down 30% in sales between October 1, 2014 and September 30, 2015. Homes selling under $500,000 represented 81% of the market. Homes between $500,000 and $749,999 were 10%; homes between $750,000 and One Million represented 4% of the market and homes over One Million were 5% of the market. The average sales price for this time period dropped 3.9% from the preceding year.
The City of Palm Desert (zip codes 92260, 92255 and 92211) experienced a 3.9% appreciation in 2015. Palm Desert’s all time average sales price was $543,000 in 2006. The average price for the time period October 1, 2014 to September 30, 2015 was $355,635. The list to sales price was 92.9% well below the state average.
In Palm Desert East (92211) from 10/1/14 to 9/30/15, a total of 778 homes sold with 105 selling between $500,000 and $749,999; twenty-seven homes sold between $750,000 and One Million with no homes selling for over One Million. So the majority of homes selling (646) were homes under $500,000 which is 83% of the total sales for this area. Indian Ridge represented only 7.7% of the total sales in this area due to the higher price point of the homes for sale. This year will be fairly competitive. Price or upgrades will matter this year for those homes on the market.
A review of the nineteen country clubs I track, show that ten experienced a drop in the average sales price from 2014. The golf course communities showing the biggest decline in sales were the Lakes, the Springs, the Reserve and the Tradition. Those communities with highest number of sales in 2015 were Indian Wells CC, Morningside, Andalusia and the Hideaway. Mountain View and Mission Hills sold the same number of homes.
The luxury market of homes selling for over One Million remains unchanged from 2014. Since the third quarter of 2015, we have seen seen an increase of 70% more homes over One Million come on the market for a total of 762 million dollar plus homes currently on the market.
Indian Ridge experienced a 19% drop in sales in 2015 from the preceding year. Based on the higher demand for homes under $500,000, this drop is more likely due to the lower demand for homes over $500,000. Approximately 22% of the sales in the 92211 zip code were in Palm Valley, The Lakes and Indian Ridge. Sun City represented 42% of the homes sold with less than 10% of their homes selling over $500,000.
The average price per square foot in Indian Ridge for homes in both the PUD and the HOA have been fairly consistent over the past two years. The average price for a home in the HOA was $628,897, off 4.5% with an average days on market of 177. In the PUD, the average sales price was $904,083, off 15% with an average days on market of 127. This decline is a result of more homes selling over $2 million in 2014 than in 2015. As of January 7th, 88 homes were on the market. Of these homes, 48 are in the PUD and 40 are in the HOA. Asking prices range from $355,000 to $2,295,000. I estimate about 95 to 100 homes to be on the market by the end of this month. If your home is on the market or you are considering selling be sure to clean it up. Clean and straighten all the closets and cabinets and get rid of the clutter. The neater your home and the less cluttered, the greater chance in getting your home sold. This extra effort is better than a large price reduction. If your home has been recently upgraded, it will make it more marketable and at a higher sales price than homes that have not been upgraded for a number of years.
The primary reason the higher number of homes on the market this year is some residents and members have reached the age where they are moving near their children, moving into assisted living communities or back to their primary residences where thy have connections to their medical professionals. We are also experiencing some of our Canadian residents selling as well.
Recent sales have become more complex as many of the homes are not appraising and buyers aren’t willing to pay more and sellers won’t sell for less. The reason for this growing problem is appraisers are required to use the tax records for their appraisals, not the Multiple Listing Service. Many buyers who purchase a home are taking a large percentage off the purchase price as value for furnishings in order to reduce their real estate taxes. In some cases it can affect the sale price up to $150,000 to $200,000 for homes selling over one million. This in turn lowers the appraised value of the homes on the market. This can also artificially lower the market appreciation.
We do anticipate an active but competitive year in the desert. As I stated earlier, it will either be price driven or upgrade driven depending upon the buyer. Fewer buyers want to remodel or upgrade so it will be price competitive for these properties. However, with the increase in home values, it is still a good time for sellers but still remains a good investment for buyers.
Prior to taking over the Indian Ridge On-Site Sales office, I had 50% of the market share for homes sold from October 1, 2014 to September 30, 2015 in Indian Ridge. Since taking over the office on October 15th, the increased number of buyer calls, walk-ins and referrals have been outstanding and provides the best exposure for the homes listed with us. My team is readily assessable. We market and advertise our listings on a consistent basis and have many websites drawing attention to our listings. The old adage of ‘give the job to someone who is busy and getting the job done’ is extremely true. I have a team of 8 highly qualified professionals who dedicate themselves to getting homes sold and finding homes that meet the needs and wants of the buyers. Over the past 13 years, I have been at the top of the industry and have been the top agent for Bennion Deville for the past 12 years. I remain the top selling agent in Indian Ridge since my first sale in Indian Ridge in 2004. This past year, we have sold over $54,000,000 in home sales – done in a market that experienced fewer sales in a slow growing market. These results happen when you have a team of professionals who are readily available to show homes and have the ability to get homes into escrow.
Being the On-Site Real Estate Sales team, with the good partnership and team work with the club, we can be very instrumental in helping to introduce prospective members to the club and getting memberships sold.
Stephanie Besant has joined my team and has 14 year of experience. On January 19th, Allison Renz will be joining the team. Both are extremely professional and talented and will provide the best service possible to our clients. The addition of these two professionals will give us even more time to service our clients.
You are welcome to stop by the Indian Ridge On-Site Sales office. If you would like a free market analysis of your home we are happy to meet with you. We encourage calling to schedule for an appointment so we can give you the time you need.
Diane R. Williams
Associate Broker/Executive Luxury Director
Bennion Deville Homes
Indian Ridge On-Site Sales Office and Luxury Homes & Estates Division