Palm Springs Real Estate Podcast with Will Cook: Recent Episodes
Will Cook
If you are looking to buy or sell a home, get all the information and the latest updates, tips, and tricks from The Will Cook Group - your professional Palm Springs Real Estate Agents.
Have sellers missed their opportunity to get top dollar for their homes?Have housing prices peaked? I hear this question often when I speak to sellers about whether they should list their homes now or wait for the market to shift.Over the last couple of months, we’ve seen interest rates climbing to the mid-5% range. At the same time, inventory levels have started to rise, buyer demand has dropped off, and inflation has become more of a problem. Despite all this, I don’t think sellers have missed the boat. Interest rates have been a key driver in our market over the last couple of years. They made the cost of owning a home cheaper than renting. Our market has also been fueled by COVID and the migration of people who can work from home.In recent months, the Federal Reserve has announced they’ve increased the Fed Funds Rate by 50 basis points to combat inflation and that they’ll continue to do this throughout the year.“If you have a plan, it’s still a great time to sell.”Affordability is the primary concern among buyers in our market, but it’s not all bad news. Though many homes in desirable neighborhoods are selling for top dollar with multiple offers, overpriced houses are left sitting on the market and might have to go through price adjustments before they’ll sell. If you’re a buyer, this could be an opportunity for you to buy a home without waiving all your contingencies. You might even get a property for market value instead of having to offer tens of thousands of dollars over asking price.If you’re a seller, pricing your home correctly from the start is crucial. I recently took a listing that I thought was fair market value, but it ended up sitting on the market for longer than expected. Why? The market has begun to shift, and some higher price points are being impacted by issues of affordability. Rising rates have increased buyers’ monthly payments by a significant amount, causing many buyers to retreat to the sidelines and wait for things to get better.For sellers asking if they should sell now or wait, my answer is that we know what the market is doing right now, but we don’t know what it will look like in six months to a year from now. Selling now is certainly a great option, but at the same time, don’t just sell to maximize your profits without a plan. You’ll need to figure out where you’ll be staying afterward, and as we’ve already discussed, buyers are not favored by this market.Whether you’re looking to buy or sell a home, we would love to have a conversation with you to guide you through this volatile market. Give us a call or send us an email. We hope to hear from you soon!
Your spring Palm Springs 2022 real estate market update.Today I’m bringing you our Palm Springs spring market update. Prices continue to surge as record-high sales and record-low inventory keep pushing prices higher in every city in Palm Springs. At the end of March, the median price of a detached home was $660,000, which represents a year-over-year gain of 20.2%; last year at this time, it was $616,000. We expect prices to continue to rise over the next two months, and then seasonal factors should take over.As of April 1, the Valley had 678 units of inventory, and it’s a bit worrisome that there was no seasonal escalation in inventory, which almost always occurs between October and April. We currently only have 0.7 months’ worth of inventory, which is 0.1 less than last year. The only hope for higher inventory is a surge of new listings, but with only 1,244 new listings in March (which is average), we don’t see that happening yet. This historically-low inventory indicates exceedingly low supply and moderate to strong buyer demand, which both contribute to higher prices.“Prices continue to surge as record-high sales and record-low inventory keep pushing prices higher.”With inflation ticking up, mortgage interest rates have also increased and are hovering at about 5% right now. There are indications this is beginning to affect buyer demand as more and more people are priced out of the market. However, interest rates are still historically favorable, and getting into the market now may be more affordable than waiting since prices are predicted to appreciate at least through the end of the year.We expect to continue seeing a strong seller’s market throughout 2022, but there might be more competition for sellers and moderation in demand as rates go up. So if you’re considering selling, you’ll have less competition and the best chance of getting your highest price if you list now versus later.If you have any questions about the value of your home or are interested in buying in the Greater Palm Springs area, we’d love to speak with you about your unique situation. Please feel free to reach out to us via phone, text, or email. We’d be glad to help you. Also, if you have any real estate-related topics or questions we can answer in a future blog, please let us know.
Here’s how the war in Ukraine and inflation are affecting our market.If you’ve watched the news recently, you know that everyone is talking about the war in Ukraine and inflation. How are these factors affecting our real estate market?First, I want to mention that I am praying regularly for the people of Ukraine, and I hope this war ends as soon as possible. However, the effect this conflict has on our real estate market isn’t entirely negative. When times are difficult, investors tend to move their money from the stock market into hard assets, such as real estate. The security of housing becomes more attractive when the future becomes uncertain. Rising inflation is having a similar effect on our market. Traditionally, real estate appreciates at the same rate as inflation; sometimes, home values even outpace it. This makes real estate a great hedge against inflation.“As long as supply remains low, home prices won’t decrease.”On top of this, interest rates are rising. As of this blog post, rates are just under 5%. While that isn’t a terrible rate from a historical perspective, it does mean that homes have become less affordable, and demand will start to decrease. That being said, about 40% of homes in our area are purchased using cash. Rising rates may curb demand, but as long as supply remains low, there is no reason to expect a price decrease. In fact, our real estate market may experience double-digit appreciation this year.As always, it comes down to supply and demand. Our inventory remains incredibly low, and global conflicts are driving investors towards hard assets like real estate. As long as these factors remain, we’ll be in a strong seller’s market. If the war in Ukraine turns into something bigger, it could have a different impact on our area. For now, it’s still a great time to buy or sell.If you have questions about today’s topic or anything else related to real estate, please call or email me. I would love to help in any way I can!
Here’s why I tend to discourage sellers from listing homes as pocket listings.In our competitive market, buyers and investors are looking for pocket listings because they think they’ll get a better deal on those properties. I get at least two or three calls a week from investors both in and out of the area looking for pocket listings. However, today I want to talk about why pocket listings are a bad idea.First, what is a pocket listing? It’s a listing that an agent takes but doesn’t expose to the broader market. Instead, they keep it in their pocket and retain exclusive access to it.So why do I think that selling a home as a pocket listing may not be in the best interest of sellers? It’s because turning a house into a pocket listing vastly limits the exposure of the property. If you properly market your home, you’ll generate enough interest to create a bidding war. That, in turn, will help you realize your home’s highest potential price. In California, the listing agreement that you sign with an agent outlines all the benefits of putting your home on the MLS, and it frowns on the idea of holding homes as pocket listings for the aforementioned reasons.“Holding a home as a pocket listing limits how many buyers see it, which reduces the price you’re likely to get when you sell.”There are some situations when a pocket listing makes sense, however, such as when you’re in the public eye or going through financial hardship or divorce. You might not want the entire neighborhood to know that you’re selling your home.In this strong seller’s market, it might be a better idea to give your property a little time before you decide on an offer to allow as many buyers as possible to see it. I’ve seen a lot of properties enter and leave the market within just 24 hours. It seems like those sellers might just be accepting the first offer they received without generating a bidding war. That probably happened because the home didn’t spend enough time on the market to generate the appropriate level of interest.If you have any questions about pocket listings or you’re thinking about selling your home, don’t hesitate to reach out to me by phone or email. I’d love to have a conversation with you.
Here are three things that are giving our buyers a competitive advantage.Even though we’re in a strong seller’s market here in Palm Springs, there are still ways that you can win as a buyer. Buyers are having to compete for homes like never before these days, but here are three tips that we’re sharing with our clients to help them get their offers accepted over the others:1. Move quickly. You should already have a process in place to evaluate homes before looking at them in person. First, determine your “must-haves” in a home. I suggest that buyers take a blank piece of paper, draw a line down the middle, and sort what they want into two columns: must have and nice to have. Identify your top three must-haves and agree on them.Once you start looking at homes, you’ll be much quicker to evaluate them. We have our buyers rate each home they see on a scale from one to 10 as they consider the home’s price, condition, and location. In general, a home that scores a seven or above could be a good contender to consider purchasing.“A pre-approval letter and proof-of-funds letter serve the same purpose.”2. Demonstrate your ability to purchase to the seller. To show you have the desire and the ability to own a home, have a strong pre-approval letter from your lender. If you’re paying cash, a proof-of-funds letter serves the same purpose. These are items that we strongly encourage you to submit with your initial offer.3. Come in strong with your offer. If you find a house that fits your needs and has your must-haves, we advise you to come in strong on price. You may not get a chance to increase your offer down the line, so you want to put your best foot forward from the beginning. If a home is priced well, you should expect to at least pay the asking price if you’re in a multiple-offer situation. Make your highest and best offer first because there is no guarantee you’ll get to make another one.We’ve had a lot of success in securing properties for our buyers even in a competitive seller’s market. We’d love to help you as well.If you have any questions about buying a home or anything else related to real estate, don’t hesitate to reach out via phone or email. We look forward to hearing from you soon.
I’m going deep into whether or not our market is slowing down somewhat.Is our real estate market slowing down somewhat? I’ll be doing a deep dive into answering that question today. Many factors go into assessing how the market’s doing, and I’ll be discussing the main ones. The question of whether our market is slowing is a difficult one to answer due to a few considerations.Feel free to watch the full message above or use these timestamps that will direct you to various points in the video:0:00— Introduction to today’s topic0:25— Year-over-year change in housing inventory for June 20210:50— Year-over-year change in housing inventory for July 20211:50— If inventory continues increasing, we could see a wave of activity later in the year3:30— Home builders are now limiting their sales to try to catch up4:40— The fears of a COVID-19 variant wave could change things again5:50— Advice if you’re looking to buy or sell6:15 Wrapping up today’s topicPlease feel free to reach out to us via phone, text, or email if you’re thinking about buying or selling. We’d love to help you. Also, if you have any questions or topics you’d like us to talk about in a future video, please let us know. I’d be happy to make a video about it.
We may be sensing signs of a shift in our current real estate market.As a housing analyst, Ivy Zellman is a trusted source of information regarding the housing market. She recently stated in her June broker report, “This month’s overall homebuyer demand rating equaled 86 on a 0-100 scale, down from 88 last month and marking the first sequential decline since November.” This is our first indicator that buyer demand may be beginning to wane ever so slightly.At 0:55 in the video above, you’ll see the results of a survey from the home purchase sentiment index that tracks the percentage of respondents who say that it’s a good time to buy. In May of this year, 35% thought it was a good time to buy, a sharp contrast from last year when that number was 61%. Perception is reality, and if people are feeling like it’s not a good time to buy, that becomes their reality.“We may see a slight cooldown on this frenzied market that we’ve experienced over the last year and a half.”Next, at 1:55 in the video above, you’ll see the monthly showing time index. The chart shows that in May, the number of showings went down compared to March and April, though they’re still above where we were this time last year. There are still plenty of buyers in this hyper-seller’s market, but we seem to be seeing signs of buyer fatigue. But what’s causing this buyer fatigue? There are actually a few factors to note: Record price appreciation Extremely low inventory Record-high percentage of sales over list price Record-low days on market Historically low mortgage ratesThe final graph at 2:59 above shows the months supply of homes for sale going back to 1999. With supplies hovering between one and two months of supply, we’re nowhere near being in a buyer’s market, but there has been a small uptick in that direction. Don’t count on the market normalizing anytime soon, but we may see a slight cooldown on this frenzied market that we’ve experienced over the last year and a half.If you’re a buyer, we would love to help you navigate this market. You need a trusted advisor at your side to get you through your next home purchase. If you’re a seller, note that while the market still favors sellers, things are beginning to trend slightly towards buyers. That means there’s no better time to sell your home for top dollar.Whether you’re buying or selling, or if you have questions about real estate in general, don’t hesitate to reach out to me. I’d love to hear from you.
Is the current market affordable, and is it a good time to buy?Is it a good time to buy a home in today’s housing market? The power lies in the hands of the sellers; rapid appreciation is driving declines in affordability despite rising incomes, and we’re seeing very low mortgage rates. Housing affordability declined in April by 7%, which was the most since December of 2018. Days on the market are at record lows, and multiple-offer bidding wars are common across all price points. Does this mean it’s a bad time to buy a home? Should a buyer wait for the housing market to cool off or jump in now before affordability declines even further?Buying a home is both a financial and lifestyle decision. If an individual or a family has made the lifestyle decision to buy, then it becomes a financial question. Will affordability decline in the months to come? If so, it may be a good time to buy before things get worse. However, if buyers start to back off, thereby lowering the likelihood of bidding wars, causing house prices to moderate, and affordability to bounce back, you may want to consider waiting.Shifts in housing supply or buyer demand can affect affordability. If supply increases and meets demand in the middle, then house prices will moderate. Unfortunately, while inventory has increased slightly in recent weeks, it remains at near historic lows and is not enough to compensate for the decade of underbuilding. It will take years for the supply to catch up to the demand. In the meantime, any new housing inventory will be quickly bought due to existing demand, so significant housing relief is unlikely in the near future.Another thing that could moderate demand is a substantial increase in mortgage rates. However, without an increase in income or decrease in the house price growth, a rise in mortgage rates is going to accelerate the decline in affordability and squeeze out the buyers that are on the margin out of the market. With these buyers out of the market, there might be less intense and frequent bidding wars, and house pricing may moderate. However, even without the rising mortgage rates, if house price appreciation continues to grow, then that’s going to reduce affordability even further. In the short run, it’s going to squeeze more buyers out of the market.“Affordability is likely to worsen before it improves.”Household income growth and price appreciation can provide some insight into the likely direction of affordability in April. The nominal house price growth increased by 16.2%. That’s nearly double the 8.6% seen last year. For affordability to improve, house-buying power must outpace nominal house price growth. That’s not happening right now.Looking ahead, economists forecast mortgage rates to hit 3.4% by the end of 2021. The household income would need to increase by about 5% to offset any affordability loss due to increased mortgage rates. While incomes are expected to increase in the months to come as the economy continues to improve, it’s unclear if it’s going to reach the pace necessary to offset the potential rising mortgage rates.The bottom line is that while nominal house price growth may moderate due to the affordability squeeze on buyers who are on the margin, the severe supply and demand imbalance means the housing market is unlikely to cool enough to result in a material improvement in affordability. Even if demand moderates due to an affordability squeeze, it will take time for the supply to catch up with demand, which is increasing house price growth.So should you buy now or wait? Affordability is likely to worsen before it improves, so try to buy now. If you’re a buyer looking for a home in the greater Palm Springs area, we have a lot of experience placing buyers in homes and shepherding them through multiple-offer situations. We’d be happy to help you as well. Please feel free to just give us a call, text, or email.
The numbers indicate we’re not in a housing bubble.Are we in a housing bubble? Is the market going to crash?This seems to be something I’m getting asked about a lot these days. While I don’t have a crystal ball and can’t definitively answer these questions, I can share some information that would indicate we’re not in a housing bubble. The first key to remember is that the last market crash from 2005 to 2008 was built on predatory lending. Lending standards were very loose back then. However, with the passing of the Dodd-Frank Act and the new regulations formed by the Department of Housing and Urban Development, it’s much more difficult to get a loan. Lenders nowadays check your down payment, debt-to-income ratio, and have very strict standards for giving loans. Second, due to our high job loss caused by the pandemic, the government created forbearance programs that allowed homeowners to defer or delay their mortgage payments for a certain amount of time. As they begin to make those payments again, many lenders are allowing modifications to their mortgages, which allows them to put their payments on the back end of them. This has prevented outright foreclosures from happening; the number of foreclosures in our area is very low.“If you’re interested in purchasing a house, now might be the time to act so that you don’t have to pay that additional 6% to 7% in the next year.”Third, home prices have appreciated by 21% in the past year in the Palm Springs area, which gives a lot of homeowners additional equity in their homes. If they find themselves in a difficult place, they’d be able to get out of their homes and cover their closing costs quite easily. Lastly, new housing starts are at a 10-year low. Builders haven’t been building at the same pace that they did during the runup to the last crash. We have a housing shortage issue that’s creating more appreciation for sellers. As long as interest rates stay low and wage growth continues, it’ll create affordability even though homes are appreciating. Over the next year, we’re projecting homes to keep appreciating at a rate of 6% to 7%. If you’re interested in purchasing a house, now might be the time to act so that you don’t have to pay that additional 6% to 7% in the next year. If you have any questions about selling a home or purchasing in this market, don’t hesitate to call or email me. If you have any other real estate-related questions, feel free to reach out to me as well. I’d be happy to help you. I’ll see you next time!
I’m here to give you the details and update you on our spring market.Today I’m going to give you an update on our spring real estate market. Record-low inventory and record-high sales are the big two conditions driving home prices higher in every city in the Coachella Valley.Cited below for your convenience are timestamps that will direct you to various points in the video. Feel free to watch the full message or use these timestamps to browse specific topics at your leisure:0:30 — Median home prices trending up1:16 — Despite low inventory, sales are up2:40 — Demand continues to exceed supply3:40 — Median number of days on market4:15 — Comparing average total sales4:45 — Mortgage rate projections5:22 — What this means for buyers6:22 — What this means for sellersIf you have any questions about your specific situation, I’d love to have a conversation with you. Please feel free to give me a call, a text, or an email. Additionally, if you have any other real estate-related topics or questions that I can answer, please feel free to reach out to me.
Here are four misconceptions about seller’s markets you shouldn’t believe.If you’ve been paying attention to real estate news, then you know we’re in a hyper-seller’s market. Sellers are getting way above their asking price with very favorable terms and conditions. So today I’m sharing four misconceptions about strong seller’s markets that you need to know before you list:1. You don’t need a plan for your next home before listing your current one. This misconception is why many people are apprehensive about putting their homes on the market. However, in a hyper-seller’s market like this, you can negotiate very favorable terms. For example, you could negotiate a quick closing and leaseback. Some of my clients have been able to lease back houses for 30 to 120 days with favorable lease terms or even rent-free. That gives them time to make a plan, search for a new property, and move into it.“It’s crucial to hire a trusted real estate agent who understands the current market.”2. The condition of the home doesn’t matter. You can’t simply put a home in any condition on the market and expect it to sell for top dollar. Usually, home condition drives prices. When I meet with clients to discuss listing their house, we walk room by room, and I point out staging tips or needed repairs or updates. My goal is to ensure they get the highest amount of money in the least amount of time. Sometimes it makes sense to sell a property as-is and sometimes it doesn’t. However, before you start making renovations, it’s crucial to get a trusted real estate agent involved who understands the current market and what buyers want right now. 3. Price doesn’t matter. In truth, pricing is critical. Buyers are concerned they’re overpaying for homes, so if you set your price too high from the beginning, buyers who have been in the market for a long time and are fatigued will be reluctant to bid on your house. Sometimes overpriced properties sit on the market, then sell for less than they would have if they had just been priced correctly from the start. 4. You don’t need a Realtor to sell your home. The temptation is to sell your home yourself to save money. However, that doesn’t always work. Yes, these days houses will sell if they’re on the market, but if they’re not priced appropriately, staged, and marketed properly, you won’t get the time, money, and energy back that you put into it. For the last few listings I had earned upwards of 20 to 50 showings in a single weekend, and they all received multiple offers. It’s extremely difficult to navigate all those offers and take the transaction from contract to close if you don’t know what you’re doing. There are many hurdles to jump through in a transaction, and it’s wise to have an experienced professional on your side. If you’re considering selling your property and would like to discuss your specific situation, I’d love to have a conversation with you. Please reach out to me via phone, text, or email. Also, if you have any real estate questions, feel free to contact me, and I’d be glad to make a video about it. Let me know how I can help you.
Here are three strategies to help you win as a buyer and seller right now.As you’re probably aware, we’ve been in a very strong seller’s market for the last 12 months in the Greater Palm Springs area. This has been brought on by the pandemic and the lower number of homes we have for sale compared to what’s normal for this time of year. This has resulted in increased prices and more equity for homeowners. The median price for single-family homes has increased by 22% in the valley over the last year.How do you take advantage of this? By selling. There are three ways in which you can sell and find a replacement home so that you don’t end up homeless:1. Extend the closing period. Today’s buyers are in multiple-offer situations regularly. If you price your home correctly, you’ll get the same type of attention. Buyers are willing to accommodate sellers in this market, so extending the closing period from 45 to 60 or 90 days to give you time to find your new home after you’ve put the current property under contract is a useful strategy.2. Close quickly and leaseback. A leaseback means the buyer will let you stay in the home for some extra time while you find your new home. We’ve been able to negotiate free leasebacks for up to 90 days for our clients, which is great news for sellers who also need to buy. 3. Make your sale conditional on finding a replacement property. The SPRP (Seller’s Purchase of Replacement Property) form gives you a certain amount of time to identify a property and negotiate a closing that will happen right after the sale of your home.“We’ve been able to negotiate free leasebacks of up to 90 days.”It’s a stressful time out there for buyers and sellers, and everyone’s looking for creative solutions. There’s a great opportunity to take advantage of the current market by cashing in on your equity and buying a new home with a low interest rate. If you have any questions about buying, selling, or real estate in general, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.
Here’s what to consider if you’re thinking of doing a pre-listing inspection.Is a pre-listing home inspection—which is an inspection done prior to listing a home on the market—beneficial to sellers or not? My answer is maybe. There are several advantages and disadvantages to consider.Advantages:1. You determine the condition of the home. This means there will be no surprises. If there are any major defects you need to address before listing the home, you’d be aware of them up front. If anything comes up in the inspection that you won’t be willing to address, you can reflect that in your marketing price and communicate it to any potential buyers who look at it once it’s listed.2. You improve buyer confidence. You’ll attract more buyers, fewer contingencies, and create a solid foundation for negotiation. Buyers will know exactly what they’re getting into when starting negotiations because they’ll have already had the necessary information on the home’s condition.3. You can have a smoother transaction. The buyer already knows the condition of the home, so you may not be faced with renegotiating price, credits, or repairs. This gives you peace of mind when entering into a transaction with a buyer.Disadvantages:1. You have to cover the cost instead of the buyer. A home inspection is typically a cost paid by the buyer during the transaction. If you as the seller order the inspection prior to listing the home on the market, you’ll have to take on the cost.2. You may find previously unknown issues in the home that you didn’t anticipate having to address or disclose.3. There are disclosure requirements regarding the findings in the inspection report. In California, we have very strict disclosure laws, and sometimes an inspection report will identify problems that read much worse than they actually are. Regardless, you’ll be obligated to disclose all of those issues, and the easiest way to do that is to share the inspection report with any potential buyers.If you’re trying to decide whether to do a pre-listing inspection or not, give me a call and I’d be happy to discuss your situation. If you have any other real estate questions, feel free to reach out to me as well. I’d love to hear from you!
If you’re a seller, here are three ways to rectify a low appraisal.We’re in a very strong seller’s market in the Greater Palm Springs area, and it’s not unusual for a home’s appraised price to not equal its contract price, especially if the property’s gone into escrow after a multiple-offer situation where buyers may have been making offers over asking price. When this occurs, there are three things you can do to rectify the situation as a seller:1. Check to see if human error is involved. Everyone’s busy in our industry right now, including appraisers, and there may be a typo or some other issue that was overlooked in the appraisal. If so, you can get that clarified quickly. “Since 60% of all closings in Coachella Valley are cash deals, appraisers sometimes have a hard time finding the necessary comps to support a price that’s accelerated quickly.”2. Create a rebuttal. In doing this, your agent will pull comps from your neighborhood and submit them to the lender. The lender will then review them, and sometimes they’re able to make adjustments to move the appraised price closer to the contract price. It doesn’t always work out to the seller’s benefit, but it’s worth trying. If the rebuttal doesn’t work, you’re left with the third option…3. Renegotiate with the buyer’s agent. Some listing agents will suggest up front—especially if you’re in a multiple-offer situation and negotiating over the asking price—that you ask the buyer to remove the appraisal contingency. They’d still have the opportunity to do an appraisal during their due diligence period, but if the appraisal doesn’t match the contract price, they wouldn’t be able to use that as justification to cancel the deal. Since 60% of all closings in Coachella Valley are cash deals, appraisers sometimes have a hard time finding the necessary comps to support a price that’s accelerated quickly. As we all know, our market has been very strong in the last year and there are no signs of slowing down in 2021. Here at the Will Cook Group, if we’re representing you, we’ll act in your best interest and give you the necessary tools to make the best deal. If we end up with an appraisal that doesn’t match the contract price, we’ll negotiate to get you the highest possible price for your home. If you have questions about appraisals, our market, or anything real estate-related, don’t hesitate to reach out to me. I’d love to help you.
Here’s what’s been going on in our greater Palm Springs area real estate market.In the greater Palm Springs area, we continue to be in a very strong seller’s market. To illustrate that, we refer you to the graph shown at 0:31 in the video above. The graph plots the percentage of sales over the last 90 days that sold above asking price. Since a home will only sell above the asking price if there are multiple bidders, it’s an indirect measure of how many bidding wars are breaking out. Historically, 10% of all homes sold since 2013 were sold for above their asking prices. This seems to be a natural minimum number. Recently, that number jumped to 22.3%, meaning that over the last 90 days, one out of every 4.5 homes sold for more than their asking prices. This is the bidding pressure that has been accelerating home prices due to the lack of supply.The months-of-sales ratio, which is inventory divided by the sales rate, measures how many months it would take to sell off the entire inventory at the current sales rate. At the end of 2020, the ratio stood at 1.7 months, which, when compared to 3.7 months at the end of 2019, seems quite dramatic. This is the lowest months-of-sales ratio in the history of the greater Palm Springs area market and is due to record-low inventories and record-high sales. The median number of days on market is now down to just 38 days. In all price brackets, the months-of-sales ratio continues to fall far below the levels we saw just a year ago. Normally, the ratio is higher in the higher-priced markets, but as the chart at 2:09 in the video above shows, the ratios in all brackets are hovering around two months. Even in the price category over $1 million, the ratio is now just 3.8 months, which is the lowest ratio in this price bracket in Coachella Valley history.“Our continuously lower inventory numbers and incredibly high demand make now a great time to consider selling your Palm Springs area home.”On January 1, the number of Coachella Valley listings stood at 1,507, which is 50% lower than this same time last year. The five-year graph at 2:35 in the video above plots the total inventory of the Valley, combining the number for both detached and attached homes. The seasonal pattern is obvious; inventory usually begins to rise in September. However, this past year has broken the pattern, as inventory has declined as we moved toward the end of the year. We personally think most of this inventory decline is due to homeowners’ reluctance to list their homes and expose themselves to masses of people during the pandemic.The next charts compare the median price of detached and attached homes in the nine major cities of the Coachella Valley. All nine cities continue to show year-over-year price gains in their median price for detached homes. Six cities show double-digit gains for median detached home prices. Detached home prices in La Quinta are up by 27.5% for the year, while those for Palm Springs are up 22.9%. Five cities show double-digit gains for attached homes. It should be noted that three cities—Palm Springs, Cathedral City, and Indio—now have median prices above their previous all-time highs recorded during the housing bubble of 2006.In terms of interest rates, Freddie Mac is projecting that we will stay around the 3% mark for a 30-year fixed-rate mortgage through the fourth quarter of 2021. If you look at interest rates throughout each quarter since 2016, you’ll see that we’re definitely in a favorable lending environment for those looking to purchase a home.For homebuyers, interest rates are 1% lower than they were last year, creating affordability despite the price appreciation. If you’re a seller, our continuously lower inventory numbers and incredibly high demand make now a great time to consider selling your Palm Springs area home.If you have any questions about your specific situation or real estate in general, we’d love to have a conversation with you. Feel free to give us a call or send us an email or text.
The holiday season has officially arrived.Happy holidays to you!The holiday season has officially arrived. We hope you enjoy this wonderful time of year and make some fantastic memories.We wanted to take a moment to thank you for your continued support. We love helping people make their real estate dreams come true, so thank you for working with us and supporting our business.This may be a busy time of year, but we are always here to help you and answer any questions you may have. Give us a call or reply to this email and we’d love to help out.In case we don’t hear from you until 2021, have a happy new year!
We hope that you and yours have a safe and wonderful Thanksgiving holiday.The 2020 holiday season has officially begun, and we hope you are as excited about it as we are. Despite the challenges that 2020 has brought us, we want to take a moment to express our gratitude and appreciation for you, our clients, supporters, vendor partners, and associates. Without you, we wouldn’t have been able to assist as many people realize their real estate dreams as we did this year. So thank you, and we wish you, your family, and your friends a very happy Thanksgiving! In the meantime, if you have any real estate-related questions about the greater Palm Springs area, we are here to help, so please feel free to reach out.
Here’s what has been going on in our greater Palm Springs area real estate market.In general, we have continued to be in a very strong seller’s market. In the video above, you can see a slide that shows the correlation between the days on market and the months of sales. The red line, representing months of sales, is the ratio of inventory divided by the sales rate, and it technically measures how long it has been taking to sell the entire inventory at the current sales rate. Due to growing sales and record-low inventory, the months of sales ratio is again at a historic low of 2.4 months. On November 1 of 2019, the ratio was 3.8 months. This indicator is confirmed by another important time metric called the median number of days on the market, which is currently 43 days, compared to 62 days at this same time last year.On the next slide, the months of sales ratio is calculated in different price brackets. The inventory of homes in each price bracket is divided by the sales rate in that price bracket. The ratio in each bracket continues to be below the levels we saw a year ago, and is less than three months in every bracket under $900,000. Once again, this is confirmation that our strong housing market does stretch across all price ranges. The extremely low ratios from $600,000 to $900,000 are unusual for these higher price points.“Our continuing low inventory numbers point to now being a great time to consider selling your home.”Valley inventory continues to hover at historically low levels. On the next slide in the video, you’ll see that on November 1, there were only 2,014 units for sale. This is far below previous years—last year, there were 3,010 units for sale, and the year before that, there were 3,173 units available. Although many attribute the low inventory to the current pandemic, inventory has been continually declining for over five years, so the cause of currently low inventory might be more complicated than many think. In the slide at 2:39 in the video above, the tables compare the median price of attached homes to detached homes in all nine major cities in the Coachella Valley. Seven cities now have year-over-year, double-digit price increases for detached homes. The four cities with the largest increases—La Quinta, Desert Hot Springs, Cathedral City, and Palm Springs— range from 17.3% to 38.9%. The median detached home price in Palm Springs is now 30% above the all-time high record in 2006. Three cities showed double-digit price increases for attached homes—La Quinta, Palm Springs, and Rancho Mirage.For buyers, interest rates are on average 1% lower than they were this time last year, creating affordability despite the price appreciation. This, in combination with the general desire to secure private space and the desire of most employers to work from home as we ride out the pandemic, has fueled demand and reinvigorated buyers to secure properties. If you’re a seller, our continuously low inventory numbers point to now being a great time to sell in the greater Palm Springs area, as this is the type of market where you’re going to get the highest price for your home.If you have any questions about the market or how we can assist you in your unique situation, we’d love to help you. We’ve helped many buyers and sellers through the process during this pandemic. Just give us a call, email, or text, and we’ll get right back to you.
To find out what’s going on in a market, agents use these five indicators.How is the market? This is a question real estate professionals get asked on a daily basis. However, unlike the stock market, which is reported daily in the national news, real estate is hyperlocal. Thus, it’s not reported on daily. For an inexperienced real estate agent, it’s easy to answer this question based on how their business is doing. A true real estate professional, though, bases their answer (and predicts demand in pricing) on five key indicators:1. Volume of active listings. As this volume decreases, prices increase because there is more demand and not enough inventory. We saw this during the spring of 2020 once the pandemic hit and impacted most sellers’ plans. 2. Median sales price. The median sales price usually trends in the opposite direction of the volume of active listings: If the volume of active listings is down, the median sales price is rising because there isn’t enough inventory.“If there is a lot of volume, activity, and inventory, but demand is low, the average sales price is probably lower than the average list price.”3. Time on market. This is an indicator of how much demand exists. If a listing’s time on the market is low, it means demand is high.4. Ratio of active-to-pending listings. As this ratio narrows, demand increases. When the number of active listings equals the number of pending listings, there is good demand. When the number of pending listings exceeds active listings, then you know you’re in a red-hot market and prices are going up. 5. Sales price versus list price. If the average sales price matches the average list price, it means demand is up. If there is a lot of volume, activity, and inventory, but demand is low, the average sales price is probably lower than the average list price. If there are fewer listings on the market, demand will increase, and you’ll see prices being bid up and multiple-offer situations become more common. Therefore, the average sales price and the average list price will match. In our current market, we sometimes see a home’s sale price surpass its list price. However, in our local and national markets, lending policies and appraisal practices are conservative and holding back prices. Even though a buyer may want to buy a house above its list price, the lender and appraiser will hold back the appraised value, so the buyer may not qualify to buy that house. Keep this in mind if you’re a buyer, and always seek the advice of a real estate professional. If you have any real estate questions or are thinking of buying or selling a home, simply reply to the email that led you to this blog or give me a call. I’d be happy to help you however I can!
Here are some of the most important things a seller can remember in this market.If you want to maximize your home sale in this seller’s market, here are the five tips you must remember:1. Create a buzz about your home. You want your home to hit the market with a bang and get into escrow quickly, and you’ll need professional photography to do so. Keep timing in mind, too; the best time to list your home is Thursday afternoon or Friday morning because then it’ll be front and center in the feed of every buyer who’s gearing up for a weekend full of home tours. Since there will be tons of tours of your home scheduled that first weekend, it may be best to go out of town or stay at a friend’s house. Typically, the best offers come in early, and you want to do whatever you can to allow for as many showings as possible. 2. Price it right. Being in a seller’s market doesn’t mean you can choose any price you want. Today’s savvy buyers will see right through your greed if you price too high. Work with your agent to price your home appropriately so that it sparks a lot of interest and stands a better chance of generating multiple offers. 3. Review all offers. If you’re lucky enough to receive multiple offers, it may be tempting to simply select the highest one. While that may ultimately be the best choice for you, have your agent run a net sheet on it. Also, consider the other terms of the offer. Is the buyer getting financing, and if so, do they have pre-approval? Or, if they’re paying cash, do they have proof of funds to demonstrate their ability to purchase the home? Check out the closing date on the offer—does it really work best for you? Use some of your leverage as a seller in this market to renegotiate that date if need be, or negotiate a rent-back so you have more time to find your next home. “Being in a seller’s market doesn’t mean you can choose any price you want.”4. Be careful when calling for the highest and best offers. Asking buyers to submit their highest and best offer after receiving multiple initial offers is basically asking them to compete amongst themselves. Some savvy buyers aren’t interested in participating in such an ordeal. Just make sure you understand that asking this does carry the risk of turning some folks away. One of the tools we have available is something called a Seller Multiple Counter Offer Form, and you can use it to counter each offer individually based on the specific terms you’d like to adjust.5. Act quickly. When responding to offers, have a sense of urgency—especially if you’re in a multiple-offer situation. It can be a frantic time for buyers, and sometimes they bid on several properties; if you take too long to respond, you may discover that some of your potential buyers have already moved on and are in escrow on another deal. So, be respectful of buyers’ time because it could impact your bottom line. I hope you found these tips beneficial, and if you’re lucky enough to be a seller right now, we’d love to help you. We’ve handled many multiple-offer situations from both the buying and selling side of things, and we can coach you through the process. Don’t hesitate to reach out via phone or email, even if you simply have some questions about this or any other real estate topic!
Here’s how we’re helping frustrated buyers win in this market.We’re in a very competitive seller’s market in the Coachella Valley and the Greater Palm Springs Area. As a result, a lot of our buyers are very frustrated with being able to find the right home or getting their offer accepted when they do. We’re finding ourselves in a lot more multiple-offer situations these days and our buyers want to know, “How can I make my offer stand out?”One strategy we’re having success with is abbreviating some contingency periods, specifically the loan, due diligence, and appraisal contingency periods. Some of our buyers have removed one or more of these contingencies upfront and allowed for the due diligence period to complete those items. “A lot of buyers out there are frustrated.”In California, the due diligence period is typically 17 days and allows buyers to back out for any reason during that time. We’re suggesting that our buyers remove the appraisal and loan contingencies, making sure their lender can get an appraisal done quickly during that due diligence period.If you have any other questions about buying a home, we’re happy to talk and strategize about how to get your offer accepted. We’ve had a lot of success over the last few months and are here to answer your questions at any time. We look forward to hearing from you.
Our Palm Springs market is hot; here’s what you need to know.What’s happening in the market? Well, homes are very affordable thanks to crazy low interest rates. The only time the affordability index was higher was back when distressed properties dominated the market amid the housing crisis. Right now, prices are increasing; six leading authorities on the housing market produced surveys, and only one predicted a depreciation of home values—a modest dip of 0.32%. That same entity then predicted values to rise steadily in 2021 and 2022, so it seems things are headed in the right direction. Cited below for your convenience are timestamps that will direct you to various points in the video. Feel free to watch the full message or use these timestamps to skip to topics that interest you most: 0:52 — Are we headed for a V-shaped recovery? 1:40 — Record housing affordability and other buyer motivations 3:45 — Pending sales and new listings nationally and regionally 5:22 — Average price per square foot is on the rise and the sustainability of appreciation 6:40 — Homes are flying off the market, and well-priced homes are seeing multiple offersWith all of the market factors combined, it’s a surprisingly great time to make a move in real estate. As always, if you have a question about the value of your home or are interested in buying in this market, we’d be happy to help you out. Reach out to us with a call, email, or text.
With graphs and quotes, I’m showing how our current market is doing.What is the pulse of our local real estate market during the pandemic? I’m sharing some national news and local data to show how our market is doing amid the health crisis. History suggests that the housing market will likely fare better through this time than the overall economy. We don’t know exactly how this will all play out, but homebuyers are beginning to come back to the market after demand declined this past month due to the coronavirus. This uptick in activity is reassuring. To learn more about our current market, watch our latest video above.
Yes, the news is grim, but the first step toward operating in a place of calm is to gather perspective and facts. Today I’m offering both.I’ve been doing some research to better understand how a recession will affect real estate. According to the National Bureau of Economic Research, a recession is defined as a significant decline in economic activity spread across the economy lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. COVID-19 hit the pause button on our American economy in the middle of March. Goldman Sachs, JP Morgan, and Morgan Stanley are all predicting a deep dive in the economy in the second quarter of this year. While today we may not be in a recession by the technical definition of the word, most people believe that history will show we were in one from April to June 2020. Does that mean we’re headed for a housing crash like what we saw in 2007 through 2009? History shows that most recessions do not negatively impact home values, with two recent exceptions: the Gulf War recession of ‘90 to ‘91, and the Great Recession of ‘07 to ‘09. No other recessions have impacted the U.S. housing market. What are economic leaders saying about this downturn? Robert Dietz, chief economist with the National Association of Homebuilders stated, “The housing sector enters this recession underbuilt rather than overbuilt. That means as the economy rebounds, which it will at some stage, housing is set to help lead the way out.” “Most people believe that history will show we were in a recession from April 2020 to June 2020.”Ali Wolf, chief economist with Meyers Research stated, “Last time, housing led the recession; this time, it’s poised to bring us out. This is the Great Recession for leisure, hospitality, trade, and transportation, in that this recession will feel as bad as the Great Recession did for housing.” Lastly, John Burns, of John Burns Consulting states, “Historical analysis showed us that pandemics are usually V-shaped (sharp recessions that recover quickly enough to provide little damage to home prices), and some very cutting-edge search engine analysis by our information management team showed the current slowdown is playing out similarly thus far.” Here’s the bottom line: We’re not in a recession yet, but we’re about to be in one. The difference is, this time, real estate will be the sector that leads the recovery.I hope that you and your family are staying healthy as we all continue to respect our statewide shelter-in-place order. If you find yourself in a place of fear, please remember: This too shall pass. We’ll get through this together. If we can assist you in any way and help you to have a firmer grasp on what’s happening in the real estate market, please feel free to reach out to us by phone or email. We’re always here for you.
Although we’re continuing to help buyers and sellers in the wake of the coronavirus pandemic, we’re also helping people in our community outside of real estate. Here’s a quick update on what we’ve been doing.The COVID-19 pandemic has been disrupting our daily lives for a few weeks now. Some businesses, such as restaurants, theatres, and bars, are struggling. Others, like grocery stores and food delivery apps, are thriving. Here’s what’s going on from a local real estate perspective.California is currently under a shelter-in-place order. All non essential businesses have been closed. Originally, this included real estate sales, but this past weekend, we have been reclassified as an essential business. Even still, this is anything but business as usual.All Realtors doing business in today’s market must now take into account the health and safety of their clients and fellow Realtors. If the proper health and safety protocols are not followed, we run the risk of getting shut down once more.Although open houses are not allowed right now, there are some activities that are. They include virtual showings, one-on-one showings in person, property inspections, and appraisals. They can all be done as long as the health and safety protocols from the CDC are being observed.“We’re continuing to develop new tools that will help us navigate things safer and healthier.”While the coronavirus has had a direct effect in the form of a slowdown in activity in the Coachella Valley, there have been over 200 new listings put on the market in the last week. During the same timeframe, 50 properties have gone under contract and 200 home sales have closed.If you’re wondering what your next steps are as a buyer or seller, here’s what you should do.First of all, safeguard your health and the health of your family. If you need to hit the pause button on your transaction, that’s fine. However, there are plenty of people who still need to buy and sell right now for various reasons. For these clients, we can coordinate virtual showings, one-on-one showings, and more. We’re continuing to develop new tools that will help us navigate the business in a safe and healthy way.We’re available to you as a resource outside of real estate as well. If you need someone to pick up a prescription or groceries, we want to help. We’re here for you. Just give us a call or send us an email if you need anything. In the meantime, stay safe and healthy.
Overpricing is one of the worst mistakes you can make as a home seller. Here are three ways to tell that your price needs to come down.If you’re selling your home, you need to understand that pricing properly from the very start is critical. The most common reason that homes don’t sell is because they are overpriced. Overpricing can cause damaging effects. If you overprice from the beginning, you’ll end up with less money in your pocket when you do sell. If you do make the mistake of overpricing your home, it’s important to make adjustments quickly. How do you know it’s overpriced, though? Here are three telltale signs:1. Very few or no showings. Excitement is a very common emotion for sellers. They are generally very happy that their home is on the market and being advertised everywhere. However, what happens when weeks have gone by and you’ve had little or no showings? The excitement turns to concern and frustration. If this sounds familiar, your home is likely overpriced. In a low inventory environment like the one we have in the Greater Palm Springs area, it would be advisable to adjust the price in hopes of generating more activity.“If a home fails to sell in this market, it’s not due to a lack of buyers.”2. You’ve only received lowball offers. Most overpriced homes don’t receive any offers at all. If your home is overpriced and still receives a few offers, you should feel fortunate, even if they are lowball offers. However, if a home is overpriced and all the offers it is receiving are much less than the asking price, are they really ‘lowball’ offers? If you’ve received multiple lowball offers, it’s time to reconsider your initial price and lower it.3. Your home has expired on the market. This is the most obvious way to know your home is overpriced. If a home doesn’t sell in six months, it’s not due to lack of buyers, it’s due to incorrect pricing. Look in the mirror and realize that your home was overpriced and adjust accordingly when you relist. Every home has a price tag in the market. If a home’s listing price is relatively close to that price tag, it will sell and not expire. If you have any questions for me about pricing or real estate in general, feel free to reach out via phone or email. I look forward to hearing from you soon.
Here is where our Palm Springs market stands as we make our way into 2020, according to the latest statistics.Our local real estate market is very strong right now, and I have the latest statistics from the Desert Housing Report to prove it. If you follow along in the video above, I’ve provided four slides from this report.0:26: “The blue line, called months of sales (right scale), is the ratio of inventory divided by the sales rate and technically measures how long it’s been taking to sell the entire inventory at the current sales rate. With inventory lower than a year ago and with higher sales, the current ratio of 3.7 months is lower than the 4.1 months on January 1 of last year. This low of a ratio usually points to higher prices. To show you how low this is, in January of 2016 the ratio was 7.3 months. This view is reinforced by another time metric, which is the median number of days it’s been taking to sell a home. As the chart shows, this number is now 50 days, which is the lowest number in the last five years.”“This continuing low-inventory environment indicates that it’s a great time to sell your Palm Springs area home.”1:22: “We calculate the months of sales ratio in the different price brackets. We take the inventory of homes in each price bracket and divide by the sales rate in that price bracket. The above bar chart plots these results with the blue bars being the current number of months in that price bracket compared to a year ago (orange bars). Except for homes selling in the $900,000 to $1 million price bracket, the monthly sales ratio is lower in all price brackets compared to a year ago. This is especially true in the over $1 million price bracket.” 2:01: “On January 1, inventory in the Valley for both detached and attached homes stood at 2,998. We indicated this number on the chart. Due to seasonal factors, which are evident on the chart, one should only compare inventory in any month with inventory that same month in other years. We’ve therefore indicated January 1 inventory numbers back to 2015. The long-term trend of Valley inventory is declining, which continues to make the overall housing market a seller’s market.”2:38: “On a city by city basis, median prices continue to rise for detached homes. Eight of the nine cities in the region had positive gains in 2019, while one city—Indian Wells—was down. Rancho Mirage had the highest year-over-year gain of 11.9%, followed by Cathedral City at 9.9%, Indio at 8.1%, and Palm Desert at 6.0%. Palm Springs is now 11.6% above the all-time high made in 2006. The next closest city to its all-time high is Indio, which is currently 7.9% below its high. As the regional attached home index indicates, attached home prices by city are mixed. Four cities have positive gains while four have negative returns for the year.”Interest rates, on average, are 1% lower than they were at this time last year. This has reinvigorated buyers to get out there and secure a property so they can lock in low rates. This continuing low-inventory environment also indicates that it’s a great time to sell your Palm Springs area home. If you have any questions about your home’s value or would like to discuss your unique situation, give me a call or send me a text. My team and I would be happy to answer your questions.
My team and I wish you the best this holiday season.On behalf of the Will Cook Group, we would like to send the warmest of holiday greetings to you and your family. We’d also like to express our gratitude to our clients, family, and friends who’ve been loyal and supportive of us this past year. We wouldn’t be where we are today without you, and we’re very grateful. We look forward to serving you in 2020 as well. If you have any real estate questions during the holiday season, don’t hesitate to reach out to us. We hope you have a wonderful holiday season, a merry Christmas, and a happy New Year.
With the holiday season upon us, we want to say we’re thankful for you.The 2019 holiday season has officially begun, and we hope you’re as excited about it as we are. We want to take a moment today to express our gratitude for you this Thanksgiving. We’ve met some incredible people this past year, and we’ve had the honor of assisting many of you in accomplishing your real estate dreams. Without your support, we wouldn’t be where we are today. We hope you enjoy your Thanksgiving with your family and friends. As always, if you have any real estate-related questions, feel free to reach out to us. We’re here to help.
I’m sharing my five best tips for how to buy a home in a seller’s market.Today I’m going to share five tips for how to buy a home in a seller’s market. November 1 had the lowest number of homes for sale in the greater Palm Springs area in recent history. At 3.8 months’ worth of sales, we remain in a firm seller’s market throughout the Coachella Valley. So how do buyers compete?1. Be prepared ahead of time. Do the leg work up front, and have your finances in order so you can write an offer on a property swiftly. If you’re planning to get financing, speak to a lender ahead of time and have your pre-approval in hand. If you’re paying cash, then the seller will ask you to present a proof of funds letter verifying that you have the money to close. 2. Know what you want. Create a list of must-haves versus nice-to-haves. If you’re purchasing a property with a partner or spouse, you both must get on the same page early. Have a predetermined set of priorities that you’ve agreed upon so that you can determine which homes fit your needs the best so you can move as promptly as possible.“Chances are, if you’re having a “wow” experience looking at a house, you’re likely not the only one.”3. Know the market and move quickly. It’s crucial to have a dependable advisor—an agent on your side who can help educate you on what’s happening in the particular neighborhoods in which you’re interested. Look at the list-to-sale-price ratios in terms of what homes are selling for and how rapidly they’re moving off the market so that when your dream home becomes available, you’ll know precisely how you’re going to move, and you can move quickly. Chances are, if you’re having a “wow” experience looking at the house, you’re likely not the only one. Your speed in writing an offer may be the thing that secures your dream home. 4. Be prepared to compete. Submit your highest offer early. If you’ve studied the market and the house is priced correctly, go in high and go in early. If you lowball a well-priced home, it may crush your chances of working with the seller at all. Another idea is to determine if there’s a problem you can solve for the seller. For instance, if the seller needs to find a replacement home, consider closing early and allowing them to stay in the home for minimal rent until they find another home. In California, all homes are sold as is with the buyer’s right of due diligence. So, don’t ask for trivial issues to be resolved after the home inspection or the seller may decide to sell to someone else. Don’t discount properties that have been on the market for a while. Maybe they were initially overpriced and now the seller needs to sell because it’s been on the market for a while. There may be some opportunity. Properties generally get the most attention in the first 30 days. If they haven’t sold in that time or haven’t had some sort of price alteration, then they tend to be stigmatized. It doesn’t mean the seller doesn’t want to sell. Consider putting in a reasonable offer to get a dialogue going with the seller.
Here’s what you need to know about what’s going on in our local market.For today’s market update, the first metric I’d like to discuss is our months-of-sales ratio, which gives us our absorption rate. On October 1, the months-of-sales ratio (the level of inventory divided by the average sales rate over 12 months) was 3.4 months.Like inventory, the months-of-sales ratio is very seasonal, and ratios should only be compared to other ratios in the same month of previous years. This latest ratio is almost exactly equal to October 1 of 2018, and the ratios for both this and last year are the lowest they’ve been over the last 10 years!The median days on market for the region is 65 days, meaning that on average, homes take that many days to sell. This is effectively equal to last year’s 66 days. The chart you’ll see in the video above at 1:04 shows that our days on market has been hovering around 70 days for the last three years.At the current sales rate, the months-of-sales ratio for homes priced under $200,000 is 1.9 months, while the ratio for million-dollar homes is 7.8 months. Between those extremes, we see a very normal increase in the months-of-sales ratio with respect to price.“Our continued low rates have moved buyers off the fence and well-priced homes are getting snatched up quickly.”Overall, this metric shows the housing market to be in good condition throughout all price ranges. The Coachella Valley inventory continues to remain historically low; on October 1 of this year, there were 2,736 units for sale, which is the lowest level of inventory over the last 10 years.While low inventory makes it difficult for buyers to find homes, the low supply is a very positive indicator for higher home prices. Interest rates have actually dipped a little again this past month—however, volatility continues to be the norm. Our continued low rates have moved buyers off the fence and well-priced homes are getting snatched up quickly. Now is a great time to consider selling your Greater Palm Springs area home and getting the highest possible price for it.If you have any questions about the value of your home or if we can assist you in finding your own slice of the California desert, we’d love to talk to you. Simply reach out to us, and we’ll discuss the best path for you given your unique circumstances.
Once you’ve decided to sell your home, make sure to take these four steps before it goes live on the market.Before you decide your home is ready to be seen by potential buyers, it’s important to take four key steps before putting it up for sale on the market to ensure it sells for its maximum value:1. Re-paint. Giving your walls a fresh coat of paint will not only make your home appear cleaner and brighter, but it will also help to conceal any cracks or damage. 2. Make necessary repairs. Buyers are going to be going through every detail of your home with a fine-toothed comb. So, before they have the chance to do so, make sure you fix any and all problems they might uncover. This includes structural, mechanical, and safety issues alike.“Having a clean home is crucial to impressing buyers.”3. Fix up your landscaping. Your home’s curb appeal will serve as your potential buyers’ first impression, and having great landscaping will help ensure it’s a good one. Adding fresh mulch, planting some flowers, and trimming up bushes and trees can go a long way.4. Deep clean. This is probably one of the most important steps. You may even want to hire a professional cleaning crew to make sure every nook and cranny is sparkling. After all, having a clean home is crucial to impressing buyers. If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.
There are three key reasons that you should live in a home before renovating it. I often recommend that homebuyers live in a house for awhile before they undertake large renovation or expansion projects. Now, I’m not talking about basic plumbing or electrical issues that are necessary to make a home habitable; I’m rather talking about larger renovations and expansions.Why live in a new home before renovating? Well, there are three good reasons to consider holding off on big home improvement projects until you’ve had time to settle in:1. Living in a home can change your mind. You may have grand visions of what you’d like to do to a home based on its condition and your priorities, but until you’ve actually lived there for a time, it’s difficult to know exactly how you’re going to use the house, as well as what projects will and won’t work. Ultimately, it’s your day-to-day experience that will inform your home improvement decisions, not your early notions of how you want your everyday experience to be.2. You deserve a break after buying a home. Buying a home is a stressful project and an enormous change in your life. In addition to being a shock to your system, it may also be a shock to your finances. I’ve seen buyers jump through hoops for months on end, spending enormous amounts of time to look for homes. For some, it becomes a part-time job. With all the decisions to make and the contractors to deal with, a home renovation can become yet another big, stressful project. Take a break from that stress and enjoy your home for awhile.“You may be surprised at how your perspective and priorities change once you’ve had some time to settle in.”3. You need time to plan. Any renovation, no matter how small, should be designed with care; that means speaking to multiple architects, contractors, and designers to get their take on your ideas and options, which is a time-consuming process. Some buyers may want to jump right into renovations because they don’t want to live in a construction zone or pay rent and a mortgage at the same time. This may make some economic sense superficially, but it can cause some costly problems later on.While you should be open to doing work on a home, don’t feel stressed about getting it done all at once. Live in your home as is for six months up to a year; take it for a “test drive” and see how it runs. You may be surprised at how your perspective and priorities change once you’ve had some time to settle in.If you have any questions about this or other real estate topics, don’t hesitate to reach out to me. I’d be happy to help you.
Some buyers and sellers are unsure of what costs they’re responsible for in a real estate deal, so today we’ll get to the bottom of this common quandary.When a buyer submits an offer on a home, one of the steps they must take is to fill out a purchase contract with the help of their agent. Within this contract, they will be able to stipulate what they plan to pay and when they would prefer to close, among other things. Today, we’ll be focusing on one particularly crucial portion of this contract: the Allocation of Costs section. This section (also known as Paragraph 7) in the California Residential Purchase Agreement is the portion of the real estate contract that indicates what the buyer is willing to pay and what expenses they would like the seller to cover. There are four sub-paragraphs included in Paragraph 7—7A, 7B, 7C, and 7D.Paragraph 7A covers inspections, reports, and certifications. Paragraph 7B covers government requirements and retrofits. Paragraph 7C covers title and escrow. And, finally, paragraph 7D covers all other costs. Everything within this section of the contract is negotiable, but there has been a precedent established in regards to which party typically assumes each given expense. With that said, let’s review what is customary for each of these categories. “Everything within this section of the contract is negotiable, but there has been a precedent established in regards to which party typically assumes each given expense.”7A: Inspections, reports, and certifications. This section is totally blank when the buyer receives the contract, so they and their agent will need to fill it out based on what’s appropriate for their specific deal. In our area, natural hazard inspections are common, so this is one item most buyers should plan to include. Usually, buyers will ask the seller to pay for this inspection, which will identify any potential natural hazards that may threaten the home. The buyer may also ask the seller to pay for a pest inspection, which will identify any active infestations of wood-consuming organisms, such as termites. As for the general home inspection, buyers are generally expected to cover this expense on their own. 7B: Government requirements and retrofits. Items within this category include things like smoke or carbon monoxide detectors, which are now required in all homes. And in the state of California, seismic strapping is required on all hot water heaters. Most of the time, sellers are expected to cover the retrofitting of these items. 7C: Title and escrow. In Southern California, it is customary for buyers and sellers to split the escrow fees, or for each to at least pay their own. It is also typical for the seller to pay for the new owner’s title insurance. The buyer will pay for their own lender’s title insurance, however. 7D: Other expenses. This subparagraph usually includes expenses like the county transfer tax, which the seller usually pays for. Smoke inspections, which are required in Palm Springs, are also generally covered by the seller. Also, if the property happens to be within a Homeowners Association (or HOA), the seller is typically responsible for paying the HOA document preparation fee—the fee that allows the buyer to receive all relevant literature related to a given HOA’s covenants, codes, and restrictions. The HOA transfer fee is another item the seller is often expected to pay for. This section of the paragraph is also where the buyer would need to indicate if they expect the seller to pay for the first year of their home warranty. If you have any other questions or would like more information about what this section entails, or about any other aspect of the real estate process, feel free to give me or my team a call or send us an email. We look forward to hearing from you soon.
What’s the latest news from our Palm Springs market? Let’s see what the numbers have to say.First, we’ll look at the months of sales ratio, which gives us our absorption rate. On July 1 of this year, this ratio was 3.8 months. That’s 0.2 months more than where we were at a year ago—an increase caused primarily by a decline in sales. In the Valley, any ratio under four months is near historic low numbers. As you can see in the graph at the 0:26 mark in the video above, this ratio is very seasonal, but it’s clear that where it’s at now is a positive indicator. The average days on market, meanwhile, is 66 days, which is almost identical to where it was last year. “With interest rates and inventory this low, now is a great time to sell your Palm Springs area home.”When we look at the months of sales ratio in different price brackets at 1:02 in the video, we see that it’s higher for homes priced under $600,000 than it was a year ago. It’s only when we get to homes over $700,000 that we begin to see lower numbers. The months of sales ratio for homes over $1 million is 10 months, which is effectively equal to what it was a year ago. Inventory in Coachella Valley remains well contained. On July 1, we had 3,010 available units, which is 28 fewer than what we had last year. Like the months of sales ratio, inventory follows a seasonal pattern, reaching its peak usually in March and then its low point in September or October. If we look at the July 1 readings all the way back to 2014, it’s clear that current inventory levels are the lowest they’ve been in the last five years. On a city-by-city basis, we see strong 12-month price increases for detached homes in eight of the nine regional cities. Indian Wells and Laquinta both showed double-digit gains. Palm Springs, meanwhile, ended June with a median detached home price of $669,500, which is 11.6% above the all-time high reached during 2007. Palm Desert’s median detached home price declined 8%.In the attached market, five cities have positive year-over-year gains, while three—Rancho Mirage, Indio, and Desert Hot Springs, have negative returns. Interest rates have dipped a little in the past month and volatility continues to be the norm. Some of this dipping has caused a lot of refinancing activity, and it has motivated buyers to lock in a low rate by securing a property. With interest rates and inventory this low, now is a great time to sell your Palm Springs area home. If you have any more questions about our market, you’re curious what your home is worth, or you’d like to know what’s available out there, don’t hesitate to give me a call or send me an email. I’d love to help you.
Here are the seven silly mistakes you need to avoid so that they don’t sabotage your home sale:1. Cords hanging from a wall-mounted TV. 2. An unkempt yard. Curb appeal is a real thing. We often encourage our buyers to drive buy the home they want to look at, and an unkempt yard can send the wrong message to buyers about what they’ll find on the inside of the home.3. A dingy front door. When showing a home, it takes a Realtor about 30 seconds to retrieve the key from the lockbox and unlock the door. During this time, the buyer is taking in the scene, and a newly painted front door, welcome mat, or pot of flowers can send a strong welcoming message to them.4. Not cleaning up after your pets. We all love our pets, but some buyers have pet allergies, and it’s a real turnoff when buyers can smell your pet’s odors.5. Poor furniture arrangement. You want to show off your home to look as spacious and inviting as possible. This way, a buyer can imagine their own furniture in your space“It’s the little things that make the biggest difference during your home sale.”6. Stuffed junk drawers, crammed cabinets, and overfilled closets. We all have lots of stuff, but when a buyer views your home, you want to make sure there is plenty of room for their things. If closets, for example, are overpacked, it sends a message that there might not be room for their items.7. Cluttered countertops. Similar to closets, you want buyers to feel like they have a lot of space to cook and entertain in the kitchen. The kitchen is one of the most important rooms in the house, so you want it to make a great first impression.It’s the little things that make the biggest difference during your home sale, which is why we give all of our sellers a thorough consultation that includes staging tips, resources to home stagers and house cleaners, and storage unit options. It’s our goal to get you more money for your home.As always, if you have any questions about this or any other real estate topic, don’t hesitate to reach out to me. I’d love to help you.
If you’re thinking of buying a home in the Palm Springs area, you need to be aware of these three nuances:Nuance #1: Location, location, locationPalm Springs is divided into three main areas: the north end, the central section, and the south end.The north end includes any neighborhood north of Vista Chino. This area features many beautiful mid-century homes and several gated communities, and it’s closely located to the city’s windmills, which means it tends to get more wind.The central section is bordered by Vista Chino and Ramon Road. This part of town is very popular due to its proximity to downtown. Not only is it both walkable and bikeable to downtown, but it’s also close to the airport. This section also encompasses some of the most beautiful and expensive neighborhoods in the city, such as Old Las Palmas, Vista Las Palmas, and The Movie Colony.The south end includes any neighborhood south of Ramon Road. This area also has a beautiful collection of neighborhoods and several gated communities, and it also features one of the Valley’s first golf courses: Indian Canyons. This part of town is a particularly popular hiking destination.Out of these three areas, you tend to get more bang for your buck in the north end because of the wind. As I already stated, the biggest advantage of buying in the central portion of town is its proximity to downtown. The south end gets the least amount of wind, but no area is immune from this once it picks up as spring turns into summer.“Palm Springs is divided into three main areas: the north end, the central section, and the south end.”Nuance #2: We have lease landIn other words, this is land you don’t own. It’s not very prevalent throughout the U.S., but we have it here in the Southern California region. In our case, we have two kinds of lease land: contractor’s lease land and land that’s owned by the Agua Caliente tribe.In the latter case, when the railroad was built in the Palm Springs area in the late 19th century, the government offered the local Agua Caliente tribe 10 miles’ worth of land on both sides of the railroad. Much of this land is still owned by the Agua Caliente tribe, so if you buy a house on that land, you also have to make a lease payment. Typically, a lease-land property can be bought for 20% to 30% less than a comparable home on fee land. However, the lease payment you have to make is not tax deductible, and you’re still responsible for your own property taxes. Nuance #3: How you’re going to use the propertyMore specifically, do you plan on purchasing a home you want to rent out when you’re not using it? I get a lot of calls from out-of-towners who want to purchase a home and retire here, but they’re not quite ready to start living here permanently yet. They instead opt to buy a home they can rent out that offsets some of the costs until they are ready to move here. Our vacation rental industry is doing very well; however, there are some pretty strong city ordinances regarding rental properties that you need to familiarize yourself with. The other thing you need to consider is that most houses that are located within an HOA neighborhood or a gated community have guidelines determining how long you can rent out your house. In an HOA neighborhood, the minimum rental period is usually 30 days. This means if you plan on turning your home into a weekend vacation rental, you should look outside of HOA neighborhoods. The same 30-day rule generally applies to condos as well, but in both cases, there are some exceptions.If you’d like to talk more about the nuances of buying a home in Palm Springs, don’t hesitate to pick up the phone and give us a call. We’d love to guide you through the whole process.As always, if you have any other real estate questions, feel free to reach out to us as well. We’d be happy to help.
Our fall market actually presents a number of amazing opportunities for Palm Spring sellers, and today we’ll be highlighting three reasons why putting your property on the market during these later months of the year may be the right next move for you.1. Interest rates are rising. The Federal Reserve recently met and raised policy rates by 0.25%. Before that, mortgage rates rose as well. Now, the average interest rate for a single-family home is hovering just below 5%. For condominiums, though, the average rate is now just slightly above 5%. And more rate increases are on the horizon, with one more coming in December of this year and three more expected in 2019. As a result, today’s sellers have the opportunity to capitalize on the sense of urgency spreading among buyers right now.“Today’s sellers have the opportunity to capitalize on the sense of urgency spreading among buyers right now.”2. There will be less competition. The majority of Palm Spring homes are vacation properties bought by those looking to take advantage of our gorgeous local weather. While other areas in the country grow cold during the winter months, our Palm Springs area remains nice and warm. So given the fact that people tend to flock here during later months and that September typically sees fewer listings than any other time of year, fall is an ideal time to list here in Palm Springs.3. The weather starts to break. While temperatures are in the triple digits during the summer, they tend to become slightly milder with the arrival of fall. This draws more visitors to our area. And more people means more exposure for your listing.If you have any other questions or would like more information, feel free to give us a call or send us an email. We look forward to hearing from you soon.
It is time for another market update. In general, we have continued to be in a strong seller’s market. The months of supply ratio is a figure that measures the balance between supply and demand in real estate. A number of less than 6 months, which is a balanced market, is good for sellers. Meanwhile, any number over six months is good for buyers.As of August 1, our months of supply ratio is 3.2. This is the lowest ratio we have seen since 2013. We can probably expect this number to decrease further over the next couple months before the seasonal forces take affect.The median days on market was 67. This is 6.5 days less than it was last year at the same time.In the above video at 1:12, you can see that the months of supply has improved for each price bracket except for the $700,000 to $800,000 range. All of the ratios below $700,000 are below four months, which is very positive.For homes priced over $1 million, months of supply is 8.6 months which is down from 11.6 at the same time last year. This figure is a low ratio for that particular price range.The median value of detached homes in each of the nine valley cities show strong 12-month gains. They range from a high 31.4% in Indian Wells to a 3.4% for Palm Springs.“Palm Springs, which has been the price leader in the region for the last three years appears to be temporarily slowing down.”Palm Springs, which has been the price leader in the region for the last three years appears to be temporarily slowing down. Meanwhile, other cities such as Palm Desert, Rancho Mirage, and Indian Wells seem to be playing catch-up.Interest rates have continued to climb and the Federal Reserve is on track to make two more increases this year. The first of which will be at their September 20th meeting. This has put some urgency on buyers to secure properties so that they can lock in on an interest rate.As interest rates increase, the number of buyers qualified for higher brackets will decrease. This may begin to create some softening effect on pricing in the higher tax brackets.Our continued price appreciation and lower inventory point is a great time to consider selling your greater Palm Springs area home. If you are a buyer who is financing your purchase, there is more urgency to get in the market now before the interest rates impact your purchasing power.If you have any questions about the value of your home or you are interested in buying in the Palm Springs area, please feel free to contact me. I look forward to speaking with you soon.
I am coming at you from one of my new listings (a beautiful vacation rental with three bedrooms and two bathrooms) to ask, “How can you be successful with vacation rentals in the Palm Springs area?” Recently I received three tips from property managers helping explain how to be successful and I thought I would share them with you today.“From your linens to your toiletries, whatever you offer guests should be similar to that of a five-star hotel.”First, however, I want to talk about measure C which was voted on banning vacation rentals. This measure was specifically for single-family homes in Palm Springs that are not in HOAs since the HOA rules take precedence over city ordinance. However, by a 2/3 majority vote, that vacation rental ban did not happen, leaving vacation rentals alive and well in our area.1. Think high-end hotel. From your linens to your toiletries, whatever you offer guests should be similar to that of a five-star hotel. You should provide ample linens so your guests do not feel obligated to wash anything during their stay. Supply shampoo, toothpaste, mints, etc. to your guests for the bathroom as well as coffee, tea, soft drinks, and bottled water for the kitchen.2. Storage area. Have your own basic storage space for your house supplies and personal belongings. You could have a locked closet in the master or use a spare hallway closet. This gives you space for supplies for not only the house, but for you if you ever plan on staying there.3. Welcome booklet. Create a welcome booklet for guests that gives instructions on how to use anything technical in the home such as the televisions, audio equipment, or alarm system. This helps prevent them from having to call you personally or your property manager. You should also include any house rules or community ordinances. And, you can even add local attractions and restaurant recommendations for the area.If you have any additional questions, are interested in buying the lovely home seen in the video, or are looking at selling your own home, please feel free to contact me. I would be happy to speak with you.
As you saw in my last market update for Palm Springs, the real estate market remains red-hot. Palm Springs has actually surpassed its all-time high in the single-family market.In fact, Zillow estimates that homes sold more quickly in 2017 than ever before. Meanwhile 2018 seems on pace to beat 2017. However, there is one segment of the real estate market seems to be lagging.I’m talking about the luxury home market.Prices in the top 5% of the real estate market increased just 5.1% in 2017, which is a full 2% lower than the rest of the market. What’s going on?Affordability does not seem to be an issue, as more Americans can afford a top-level home than ever before. Instead, it might come down to two other contributing factors.First, uncertainty surrounding the new tax bill could be affecting luxury homes more strongly, and this might be the reason why some potential buyers are choosing to sit and wait until the details of the new tax bill become more clear for their specific situation. Second, there is simply a greater supply of luxury homes than in any other market segment. In fact, 53% of available housing inventory is in the premium market, compared to 23% for the start-up market and 24% for the trade-up homes.“Demand and supply are more evenly matched at the top of the market.”In other words, supply outstrips demand at the top of the market, while in other segments, demand far outstrips supply. What does all of this mean for you?If you’ve been thinking about trading up to a luxury home, now might be the perfect time to do so. The red-hot demand for starter and trade-up homes mean you could sell your home for top dollar and in record time. The limited price growth and greater inventory at the luxury end means you could have your pick, and find a special, unique, customized home that perfectly suits your needs.If you have any questions about the current Palm Springs real estate market, what your home is worth, and what’s out there, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.
It’s time for a market update. Let’s take a look at how current conditions are contributing to rising prices and declining supply. Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
What’s going on in our local real estate market?
In general, we’ve been in a strong seller’s market recently. This can be determined by looking at the “months of supply” ratio, which measures the balance of supply and demand. In this case, supply refers to our current available inventory while demand refers to sales.
A balance of low supply and high demand is what leads us to a seller’s market in the realm of real estate. Our current ratio, which is at 4.2 months, is the lowest May 1 figure we’ve seen since 2013.
And the average number of days on market this April was 64—the lowest figure for that month in the last five years.
Returning to the subject of supply, let’s discuss how price range can impact these figures. For all price brackets below $700,000, the months of supply ratio is below six months. Homes at and above the $800,000 price point have experienced considerable improvement in terms of supply.
Now is a great time to enter the market.
Inventory, though, continues to shrink overall. As of May 1, there were 3,622 units available on our market. This is 870 fewer units than were on the market at this time last year.
Diminishing inventory is one half of what’s been driving up home prices, recently. And if typical seasonal patterns persist, inventory is likely to continue its decline until September.
Taking a closer look at appreciation, Cathedral City, Palm Springs, and Palm Desert stand out as the three local cities with the greatest price momentum for detached homes. These cities have 12-month gains of 15.6%, 12.7%, and 11.8% respectively.
Palm Springs has been the region leader in terms of price, with a current median of
$656,100. This is 9.3% above the previous all-time high we saw in 2006.
With all of these considerations in mind, now is a great time to enter the market. Sellers have a great opportunity to take advantage of current market conditions. Buyers considering using financing to purchase a home are facing some urgency at the moment, though, as the impending rise of interest rates will negatively impact purchasing power.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.
There are a number of things that could prompt your insurance company to drop your coverage. Today, I’ll be going over four common reasons this can happen. Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation
Homeowners usually see their payments to the home insurance company as a necessary evil. The coverage they offer protects your home, your belongings, and your investment. Still, shelling out thousands to an insurance company can hit your wallet hard. It may seem like a large financial burden, but did you know that an insurance company can choose to drop you altogether? Violating the terms of your agreement, not paying your premiums, or committing fraud are all examples of how this can happen. But, your coverage can also be jeopardized for other reasons. If your insurer feels you or your home are too risky to cover, you could have a hard time finding another company that will provide you with coverage. Today, I’d like to share four common reasons an insurance company will drop you: 1. You have an old roof. This might surprise you, but having an old roof can prompt your insurance company to ask you to replace it. If you don’t, they may drop your coverage. The average lifespan of a roof is 30 years. After that length of time, your roof will become more susceptible to issues like water damage. Since water damage is the most commonly submitted home insurance claim, insurance companies want to ensure your home is not at risk. Nevertheless, age alone won’t trigger a non-renewal. If your insurance company notices issues with your roof, you can expect a letter asking that you make repairs.
Don’t use your insurance policy as a maintenance policy by filing claims that barely meet your deductible. 2. You have too many claims. This might sound unfair, but it happens. Insurance companies will most likely drop a policy if you file more than one claim in the same policy term. Insurance is based on averages. The average consumer files a claim every nine or 10 years. So if you file more than that, the insurance company won’t see you as profitable. Pay close attention to how often you file claims, especially if you bundle your insurance. 3. They don’t want to cover a specific area. This might happen if the insurance company is finding that too many claims are coming in from a certain area or state. If your area is prone to crime, flooding, or fires, the insurance company may decide to cease coverage. Thankfully, there are other ways to pursue coverage if this happens to you. You can always discuss your options with an independent broker. 4. They have an issue with your pets*. Insurance companies may exclude certain pets from their policies. If your pet is exotic or considered high-risk, this may pose a problem for your coverage. With all of these things in mind, remember that there are steps you can take to stay in your insurance company’s good graces. Perform regular maintenance and make necessary repairs as soon as you become aware of them. Don’t use your insurance policy as a maintenance policy by filing claims that barely meet your deductible. Have money set aside for regular maintenance and repairs, and save your insurance for major issues. If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon
There are four steps you can take in order to prepare your home to sell for top dollar.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation
Every seller wants to get as much money as possible for their home, but few know how to accomplish this. As it turns out, there are four steps you can take to prepare your home to sell for top dollar. 1. Do the ordinary updates. These updates include replacing rotten wood, taking care of a leaky roof, getting rid of mold, and remediating other water intrusion issues. It’s also a good idea to put a new coat of paint on the walls. Buyers tend to look over houses very carefully, so it’s important to check out every inch of your home and update what you can without breaking the bank. 2. Consider remodeling or updating your kitchen. If it looks dated, repaint the walls, install a new backsplash, and purchase new, energy-efficient appliances. If you’re going to repaint, consider using low VOC paint, as it has fewer harsh chemicals and is more eco-friendly.
A great outdoor space can make or break a sale. 3. Improve your outdoor environment. A great outdoor space can make or break a sale, especially here in the greater Palm Springs area, where we enjoy so many months of incredible weather. Update your landscaping by installing drought-tolerant flowering plants or perhaps an outdoor seating area. For larger projects, you might want to consider creating a covered outdoor entertainment space, or possibly some hardscaping with pavers and a firepit. If your pool needs cleaning or resurfacing, go ahead and do that. Additionally, be sure to take advantage of any views that your property has. 4. Prioritize energy efficiency.* More buyers today than ever are looking for energy-efficient installments. To take advantage of this, consider replacing your windows, buying Energy Star appliances, or installing LED canned lighting. These features are not only appealing to prospective buyers, but they can also lower your energy bills while you’re still living in the home. If you have any questions about this or other real estate topics, please feel free to give me a call or send a text or email. I’d be happy to answer them for you.
When the market favors sellers, it can be tempting to test your luck with your listing. Today, I’d like to go over what you should do instead.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
When you start the process of selling your home, you have to make a shift in your perception. Think of home selling as a business. When you list your home, imagine you’re selling a product in a much larger market.
You can ignore the market, but to do so would likely lead to a lot of regrets. There are a lot of risks associated with pricing your home incorrectly, one of them being that you could wind up with less money than if you priced your home appropriately to begin with.
When the market is hot, it’s tempting to test it. But, buyers are smart. They have access to a much higher level of data these days. So, as they search for their next home, they make a lot of comparisons between different properties.
Rather than testing the market, it’s important to price your home correctly from the start. Buyers won’t put an offer on an overpriced listing, and there are three reasons why: 1. They don’t want to offend the seller. It goes against human nature to offer significantly less than what is being asked. 2. They believe the seller knows the home is overpriced. This belief may be erroneous, but buyers tend to truly feel that if a seller wanted to strike a deal they would lower the price.
3. They assume the seller has already turned down low offers. They think, surely, someone must have already tested the price. In reality, the listing may not have seen any offers yet at all.
It is entirely possible, in a seller's market, to get multiple offers on your home if you price it correctly, especially if you list it in a range where a lot of buyers can qualify and absorption rates are low
When you list your home, imagine you’re selling a product in a much larger market. When pricing your home, make sure you listen to your Realtor about the current value of your home. Putting your home at or just below market value provides a compelling reason for buyers to submit offers. However, buyers will only be motivated to make an offer over asking price if they have good reason to do so. One common reason they might do this is if they’re competing with another buyer.
Make sure you carefully review each offer you get once they start coming in. One offer may be a few thousand dollars higher than another, but there are other factors you should consider when deciding between multiple offers. The offer with the highest price may not be the right choice over another offer that is lower but has better terms or comes in cash. When examining offers, pay attention to any possible contingencies.
Above everything else, make sure you’re letting your Realtor guide you through pricing your home and selecting an offer.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon. .
What are the latest trends of the Palm Springs area market? I’ll fill you in on the numbers today.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Are you up-to-date about what’s going on in our local real estate market?As of February 1, the months-of-supply ratio was 4.9, which is a record-low ratio and is responsible for the continued trend of being in a seller’s market. The chart shown at 0:44 in the video shows that March is usually the high in this ratio, and we expect it not to exceed five months of supply for the entire year.This is a considerable improvement over the last three years, when it often went above six months for extended periods of time. This indicates that inventory should remain low and tight in 2018, making it a seller’s market in general, and putting upward pressure on pricing.The days on market remains low as well, at just 66 days. The inventory improvement compared to a year ago is found in all price brackets, but especially between $400,000 and $800,000. As we expect, the months-of-supply ratio increases at higher prices, but it doesn’t really start until prices get over $700,000, while inventory ratios for prices above $900,000 are better than a year ago—that segment of the market is still a buyer’s market.
Our continued price appreciation and lower inventory point to a great time to consider selling your Greater Palm Springs area home. Inventory rose by 330 units in January for a total of 4,083 units listed by February 1. As the graph at 2:06 in the video indicates, for the last five years, January has shown an increase in inventory. With some January increases larger than others, the largest increase was in January of 2016, when it rose by 1,000 units. If inventory continues its historical pattern, we should see a peak sometime next month in the low 4,000s, then slowly declining. This continuing low supply of inventory should put upward pressure on pricing. Year-over-year changes in single-family or detached median home prices of the nine major cities remain very strong. Only LaQuinta has a lower median price than it did a year ago. The other eight cities are all higher.The attached, or condo, market continues to show marginal price increases. The two largest condo cities—Palm Springs and Palm Desert—show increase of 4.9% and 3% respectively. With the threat of inflation, interest rates have begun to climb, and most experts project a steady trend towards a 5%, 30-year fixed rate by the end of the year.Our continued price appreciation and lower inventory point to a great time to consider selling your Greater Palm Springs area home. If you’re a buyer who will be getting financing, there is some urgency to get into this market now before interest rates affect your purchasing power.If you have any questions about the value of your home or you’d like to explore purchasing a home in the Palm Springs area, then please feel free to reach out to us. We’d be happy to help you out.
The new tax reform will impact the real estate market in four key ways. These changes indicate that now might be the time to start the process if you’re thinking about selling in 2018.
Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
I’ve gotten a lot of questions recently about how The Tax Cuts and Jobs Act will affect the real estate world. There are four key tax changes that will impact the housing market:
1. Deductions for property taxes. Prior to the new tax bill, if you itemized deductions on your federal return, you were able to deduct the entire property tax bill along with any state income taxes. Going forward, this total amount will be capped at $10,000.
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Deductions for mortgage interest. The final tax bill reduces the limit on deductible mortgage debt to $750,000 for or new loans that were taken after December 14, 2017. Other loans of up to $1 million prior to that time are grandfathered in.
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Exclusion for capital gains. Previously, if sold your home and turned a profit, then up to $500,000 of that profit was exempted from the capital gains tax if you were married and had lived in the home for two out of the last five years. There was some concern that this rule would be changed so that you had to live in the home for five out of the last eight years, but no change occurred. You still only need to live in the for home two out of the last five years in order to claim this exemption
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The deduction of moving expenses. You used to be able to deduct your moving expenses if you moved for a job, but the final bill repealed this rule and modified it so that you can only deduct your moving expenses if you’re a member of the U.S. armed forces.
The first two changes increase taxes on current homeowners who itemize. Therefore, they might make homeownership a little less attractive. This is why the NAR stated that we would see a 10% drop in prices in 2018. On the other hand, the last change makes it more expensive to sell your home. As a consequence, there may be more homes not coming on the market.
If you’re thinking about selling your home in 2018, now might be the right time to start the process.
We’ll have to see how things play out, but there seems to be a consensus among experts that these reforms might drive home prices down in the midterm.
On the bright side, sellers still get to keep the capital gains exemption, which is a huge win for real estate. If you’re thinking about selling your home in 2018, now might be the right time to start the process.
If you have any other questions about these changes or you need help buying or selling a home in our market, feel free to call or email me. I’d be glad to help you.
Right now, our Palm Springs market is seeing a lot of competition among buyers. Today, I’d like to offer some tips on how to win in bidding wars.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*As the housing market heats up here in our Greater Palm Springs area, homes priced under $700,000 have an absorption rate of 5.4 months. As a reminder, any absorption rate below six months equates to a seller’s market.
Since our market is currently trending in favor of sellers, it’s important that buyers prepare for the possibility of entering a bidding war during their home search. With that in mind, I’ve got four strategies to help you succeed against the competition and win out in bidding wars.
With the market trending toward sellers right now, buyers should be prepared to face bidding wars during their home search.
- Understand how much home you can afford. Buying a home makes for a very emotional purchase. If you don’t know what your limit is, you could be suckered into buying more than you can afford. Your lender or financial advisor will be able to help you determine what your limits are.
- Put your best foot forward early. If your first offer is one of several, you may not get the chance to improve it. In this scenario, let your first offer be your best. If it isn’t, you could be losing out on the home of your dreams.
- Have your agent talk to the listing agent. This will help you better understand the motivations, wants, and needs of the seller. That way, you can better meet their terms. Proposing a shorter time frame, for example, may swing the deal in your favor.
- Propose an as-is sale. The fewer conditions you put on the purchase of the property, the better the deal is for the seller. If you aren’t comfortable with an as-is sale, perhaps decrease the length of your due diligence period. You may also offer to pay for things that would customarily be paid for by the seller. Another option is to remove the appraisal or loan contingency.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.
If you are preparing to buy a home in the new year, there are seven ways you can prepare.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price EvaluationToday, I’d like to share seven tips you’ll need to keep in mind to buy a home in 2018. 1. Check your credit score. Your credit score is basically a numerical representation of your credit report. FICO credit scores range from 300 and 850. Having good credit is like gold when it comes to getting a mortgage. Those with credit higher than 740 will get the most competitive rates. 2. Do not open new credit cards. Opening up new lines of credit could damage your score, which would be detrimental to your overall purchasing power.3. Consider asking for financial gifts for the holidays. Instead of requesting a tangible item, asking for a monetary gift could help you make progress toward your down payment and closing costs.4. Start shopping for a real estate agent. Ideally, you should find someone who is knowledgeable and has experience in your area. You want someone who will work in your best interest and will be loyal to you.5. Watch interest rates. Keeping an eye on trends pertaining to interest rates can help you stay on top of what’s going on in the market. Be sure to pay attention to government actions that may have an impact on rates.6. Find a good mortgage lender. Your Realtor should be able to provide you with a good recommendation for lenders.7. G*et a pre-approval letter. This will demonstrate to any seller that you not only have the desire, but also the ability to purchase a home. When a market is trending toward sellers, demonstrating your qualifications as a buyer is very important.
Getting pre-approved will demonstrate to any seller that you not only have the desire, but also the ability to purchase a home.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.
Today I have an update on what our local real estate market is doing. Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation
*Today I’m going to give you an update on what our local real estate market is doing.
Our absorption rate, or months of sales, is 4.4. This number is confirming that we are continuing our trend as a seller’s market. This is the No. 1 indicator that confirms this trend.
The strength of our seller's market is confirmed also by a days-on-market reading of 70 days, which is three days fewer than less month. This is also the lowest number of days on market since October 2013.
As you can see in the graph displayed in the video at 1:17, we see lower months of supply ratios in all price brackets, which indicates the Valley’s improving housing market is broad-based and strengthening in all price ranges.
As you recall, a balanced market is a six-month absorption rate. That said, while the months of supply for homes priced over $900,000 has dropped from 10.9 to 9.3, this price bracket could still use some improvement, as these numbers are still a little high and indicate a bias toward buyers.
On November 1, Valley housing inventory started, as it does every year, an inevitable rise. The 384-unit increase in one month was relatively small, however, when compared to previous years. That’s a positive, and it’s primarily due to the higher sales volume in the summer months. At 3,625 units, our current inventory is 725 units less than it was last year at this time.Our appreciation, home pricing, and lower inventory point to a great time to consider selling your home in the greater Palm Springs area Year over year, the changes in the median home price of the nine major cities show overall strong gains** but also a wide variation in the numbers.
For detached homes, year-over-year go from 16.2% in Desert Hot Springs to -4.3% in Indian Wells. We see similar results for attached homes but with an even wider spread in year-over-year changes. Here, they go from a 23% gain for Rancho Mirage—which is great— down to -29% for Desert Hot Springs.
It should be noted that the number of sales in Desert Hot Springs was very low, and some of that decline was due to statistical variations.
Interest rates have continued to remain steady and are hovering at about 4% with minimal fluctuation.
Our appreciation in home pricing, and lower inventory point to a great time to consider selling your home in the greater Palm Springs area. For buyers, while there is more competition and well-priced homes are moving, the lower interest rates create a compelling reason to get into this real estate market.
If you have any questions about the value of your home or are interested in exploring investing in real estate in the greater Palm Springs area, we’d love to be the ones to help you out. Just give us a call, text, email, or check us out on the web at www.WillCookGroup.com.
As always, if you have any real estate-related topics or questions that I can answer, please give me a call or send me an email. I’d be happy to make a video about it.
See you next time!
Today we’re going to talk about what it takes to make a real estate contract legal and binding. Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Today we’re going to talk about what it takes to make a real estate contract legal and binding.
All offers to purchase real estate should be in writing. An offer doesn’t have any teeth unless it’s in writing, and most sellers won’t respond to a verbal offer. The seller then has the opportunity to respond to the offer by either accepting it or countering it with terms and a price that are acceptable to him.
This process would continue with each counteroffer being signed by the presenting party until mutually acceptable terms and price are agreed upon. If there is no agreement, then the contract falls apart.
So in general, the offer becomes a contract on the date that both parties have signed. Once this happens, the contract is binding for both the buyer and the seller. The contract is one of the most important steps in the home buying process, as it clears the way for both parties to begin the transfer of property.
It means that the sellers can begin planning their move out and the buyers can work with their agent, lender, and escrow company to get their ducks in a row for closing. Of course, just how binding the contract is depends on the detail of the contract itself. Some contracts may have contingencies built in.
Typically, a buyer’s agent will try to build in as many contingencies as possible into the contract to keep the client from being tied down in case something unexpected comes up. A listing agent, on the other hand, will typically advocate for as few contingencies as possible and may even ask to tighten up some of the time frames of the contingencies because their client doesn’t want the buyer walking away from the deal.
Why may a buyer cancel a contract? One of the most common reasons that real estate deals fall through or fall apart is because of financing, or, specifically, a buyer’s inability to get financing from their lender. For example, an appraisal contingency protects the buyer and gives them the opportunity to walk away from the sale if the property does not appraise for the purchase price.
If the home fails to appraise or appraises lower than the purchase price, it usually means that the lender won’t be able to provide the buyers with as much financing as they need to actually close on the property.
The contract is one of the most important steps in the home buying process, as it clears the way for both parties to begin the transfer of property.
Other contingencies in the contracts include due diligence for a property passing a home inspection or a buyer’s property being sold before closing, or a title search that ensures the seller has the right to sell the property.
Sellers get some protection out of the contingency, like time limits for how long the buyer has to do their home inspections or to obtain their financing. But, most contingencies are written to protect the buyer and allow them an out if something goes wrong before closing. So, if contingencies aren’t met and the buyers walk away from the deal, they can typically get their funds that are held in escrow back, which could be like the earnest money deposit.
Should any of the contingencies not be met in a timely manner, the buyer should be able to dissolve the contract and walk away with no repercussions because that’s the point of the contingencies. Of course, if the contingencies were met and the buyer physically removes a contingency by signing a contingency removal document and then decides to cancel, then the buyer is obligated to perform in accordance with the original parameters of the contract.
That means potentially forgoing 3% for liquidated damages if that’s agreed upon in the contract. Or, they could be vulnerable to a lawsuit for specific performance demanding that the buyer close on the sale or provide funds equal to the purchase price to the seller.
Why a seller may cancel the contract: It’s more difficult for a seller to cancel the contract, but it’s not impossible. If the buyer’s contingency time period expires without an agreed-upon request for an extension for that time period for that contingency, then the seller can provide what we call a “notice to perform.” And the performance is to specifically remove that contingency within a certain number of days specified in the contract.
If the buyer does not remove the contingency, then the seller can unilaterally cancel the contract. Now, it is more typical for a buyer and a seller to work out an extension of time for that specific contingency to be removed, but let’s say that the seller has a higher backup offer and is looking for ways to get out of the contract with his initial buyer. This is why it’s always important for us to respect the agreed-upon time frames for contingencies in the contract, as time is of the essence and it should be respected by all parties and their representatives.
If you have any other real estate-related topics or questions that I can answer, please give me a call or send me an email. I’d be happy to make a video about it.
Listing your home on the market can be a tricky process to navigate. There are six key points where sellers most often lose money during the transaction. Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Today I want to share the six most critical times you’re at risk for losing money when selling your home. 1. Not preparing your home to sell. If there are any items in your home that need to be fixed, don’t hesitate in making those repairs. Also remember to clean out and organize closets and storage spaces. Then, consider staging your home to sell. You want to present the best version of your home possible in order to earn top dollar.
You want to present the best version of your home possible in order to earn top dollar. 3. Overpricing your home. The higher you price your home over fair market value, the fewer buyers you’re going to attract. Pricing your home at or just below market value will generate the highest interest. Like most shoppers, buyers are always seeking the best value. 4. During the negotiation of the offer. You want to have an experienced agent by your side to make sure that this part of the process doesn’t cause you to lose any money. 5. During the negotiation of home inspection issues. Like the previous point, an experienced agent will help you determine the best route to pursue. 6. During the appraisal. The right agent will show up, meet the appraiser, and help you defend the price. 7. During the final walk-through. You want to make sure that all of the negotiated home inspection repairs have been completed. Otherwise, the buyer may ask for a credit or to delay the closing.
If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.
Right now, we’re definitely still seeing a seller’s market. But what changes have taken place since last year, and where is our market headed?Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
With a 3.9-month absorption rate, our market is continuing its trend of favoring sellers. As time passes, the seller’s market we’ve been seeing becomes even stronger.This is the first time we’ve seen inventory dip below a four-month absorption rate since 2013. However, certain other statistics have remained steady. For example, our average days on market has stayed consistent at 73 days for seven months now. By looking at the months of sales by price range we can see that inventory has gone down since last year across every price point, with all homes priced below $300,000 having the lowest absorption rate. Homes at this price point have just 2.5 months of inventory. Our Valley inventory continued to decline through the month of August, but this was expected because of seasonal trends. However, this decline occurred at an above-average rate.Inventory as of September 1st, 2017 is at 3,182 units. This is the lowest number we’ve seen since 2014, but we can expect inventory to rise in the coming fall and winter months. However, the number is not expected to rise past 4,500 as we move into the 2018 selling season.
The seller’s market is only getting stronger. The year-over-year change in the median price of detached homes across nine major cities shows that only one, Rancho Mirage, is lower. La Quinta had the largest year-over-year gain, at 13.9%. Followed by Cathedral City, which had a year-over-year change of 9.1% and Palm Springs with 7.9%.The median detached home price in Palm Springs is only 1.3% away from its all-time high made in 2006.The year-over-year change in the median price of attached homes shows five cities with higher prices and three with lower. Also, with interest rates rising combined with the current appreciation of home pricing makes now a great time to consider selling your Palm Springs area home.While there is more competition among buyers. As long as interest rates remain low, buyers still have a great opportunity to get into this market. If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.
What exactly should you disclose to potential buyers when selling your home? These are disclosures required by state and federal law.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
If you’re selling your home in California, there are certain disclosures that you are required to complete before your sale is final. The purpose of these disclosures is to alert the buyer to any potential issues in the home and generally give them a better picture of how the home has been taken care of. Here are six different disclosures that you may have to complete if you’re thinking of selling your home:1. Water damage or mold issues. If you’re aware of a leaky roof or dampness in your house, or any evidence of water intrusion, you’ll need to disclose that to the buyer.2. Lead paint. The federal government requires anyone who has a home built before 1978 to disclose their knowledge of any lead-based paint in the home.3. Natural hazards. California state law requires sellers to alert buyers of any natural hazard risks in the area such as wildfires, earthquakes, and floods. This is typically done during escrow via a third-party who creates a natural hazard disclosure report.4. Termite damage. If you’ve had your home treated for termite damage, that needs to be disclosed. During negotiations, a buyer may ask you to provide them with a pest inspection report or wood-destroying organism report. The report identifies active infestations as well as past evidence of an infestation.5. Repairs and insurance claims. If you have knowledge of any previous repairs or insurance claims from yourself or the previous owners of the home, that needs to be disclosed. I’d disclose these when you list the home.6. Death. In California, it’s required for you to disclose if you have knowledge of anybody dying in the home within the past three years.
When in doubt, disclose. We have a saying in real estate: “When in doubt, disclose.” In other words, it’s better to be thorough and alert the buyer to any and all potential issues upfront. Keeping a binder of receipts and documents that show the different upgrades and improvements you’ve made to the home is smart. If you have any questions for me or you’re interested in buying or selling a home in the Palm Springs Area, don’t hesitate to give me a call or send me an email. I would love to hear from you.
You have more control in pleasing buyers than you may think. Before putting your home on the market, make sure to remember the three things buyers most often look for.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Today, I’d like to discuss three major items homebuyers are looking for during their search.If you are a seller, you have a lot more control pleasing buyers than you may think—so go into the process with an understanding of what buyers tend to look for. This knowledge will help you find success in today’s market.Currently, there are three main things buyers tend to look for: curb appeal, space, and updates.
There are three main things buyers tend to look for: curb appeal, space, and updates. First, let’s talk about curb appeal. A first impression can only be made once, and the same goes about making a good one. Buyers should be excited about your home at first sight. Start by making sure your driveway and sidewalks are swept. Additionally, consider power washing the front of your home for an extra touch. Clean windows and tidy landscaping are also a must. You will also want to replace any outdated porch lights or front door hardware that could date your home’s appearance. The appeal of your front door is critical. Consider painting it a fresh, modern color to give your home an updated look. The second big item buyers look for is space. In fact, space is a key factor in why many people move in the first place. Before showing buyers the interior of your home, be sure to declutter. Rent out a storage space for anything taking up extra space. A buyer should be able to imagine themselves living in your home. Even in cases where people are downsizing, a clear, open space will be more attractive.Finally, don’t forget to update things around the house. Cabinet pulls, fixtures, appliances, and certain finishes should be replaced. Giving the rooms in your home a fresh coat of paint will also make a big difference. Neutral, yet modern colors will be your best choice. Buyers may not be expecting a mansion, but they are expecting you to have pride in your property.If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.
Property taxes are a significant expense for homeowners. Not to mention Mello-Roos and special assessment taxes.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
In addition to your monthly mortgage payment, you also need to consider some other taxes and assessments to get a true picture of what homeownership will look like for you. Each of these components will empower you to accurately predict and control your monthly expenses.There are three components to these taxes: property taxes, direct assessments, and special assessments or Mello-Roos assessments. Every year, the city, county, and state all charge taxes on every parcel of real estate located within their borders. For many homeowners, these property taxes are the 2nd-largest home owning expense after mortgage interest.
In most areas, property taxes are governed by state law. In most areas, property taxes are governed by state law, but assessed and collected by the county on an ad valorem basis. Ad valorem is latin for “according to value.” These taxes are calculated annually. In addition to these direct assessments, you may also be located in a special assessment district or a Mello-Roos district. In recent times, many cities have required developers to build and ensure long-term funding for parks, schools, and emergency services to directly benefit the subdivision. To prevent the influx of new homes from causing a drain on existing municipal services, special assessments are collected. A Mello-Roos district is an areas where a special tax is imposed on those property owners within a community facilities district. It is an area that has chosen to seek public financing through the sale of bonds for the purpose of financing certain public improvements and services.Mello-Roos taxes are in turn used to make payments on principal interest on the bonds and is collected with the general property tax bill. It’s also subject to the same penalties that apply to regular property taxes. This stays in effect until the bonds and the costs incurred are paid off, but it won’t exceed 40 years.Both special assessment districts and Mello-Roos districts allow raw land to be used as collateral for bonds that are sold to investors. Those proceeds are then used to pay for public facilities.If you have any additional questions about anything I discussed in this post, give me a call or send me an email. I would love to hear from you.
Real estate investing is an often overlooked, but potentially very attractive, means of diversifying and smoothing out a portfolio.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Adding real estate to your investment portfolio is a great idea. Because it offers diversification, real estate makes a good addition to traditional stock and bond style portfolios. This is especially true because real estate is it’s own asset class, can offer generous yields during periods of depressed economic activity, and can appreciate when the economy is strong.Real estate also combines aspects of stocks and bonds that tend to work in opposite directions in most economic conditions. For this reason and others, financial advisors tend to consider real estate as an alternative investment on the level of commodities. Real estate investing can not only help diversify a portfolio but can also smooth out its rough patches.The reason real estate investing is often overlooked, however, is that most people already have great exposure to the asset class by way of their own homes. Since a home is most people’s largest asset, finding exposure to real estate isn’t typically a priority.
As long as household formation continues, real estate will continue to be a viable asset class. Since the real estate bubble and the subsequent technology bubble, real estate investing has recently been considered a less attractive option by some. Despite this, people should look at it in a long-term sense. As long as household formation continues, real estate will continue to be a viable asset class.What’s more is that some stock portfolios have allocation to mortgage insurers or real estate investment trusts which tend to pay healthy dividends. Because both of these sectors are tied to real estate, they thrive when prices are rising. In a long-term sense, the health of the real estate market is determined by demographic and economic trends. These trends remain favorable and make real estate an attractive option for investors seeking non-correlated returns. If you have any other questions or would like more information feel free to give me a call or send me an email. I look forward to hearing from you soon.
Putting your home in a trust offers three important advantages that you should seriously consider. Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Should you put your home in a trust? This may seem like a question only pertinent to homeowners advancing in age, but estate planning is a topic all homeowners should seriously consider. Putting your home in a trust has advantages and disadvantages. Here are three advantages it offers. The first and most important is it allows you to avoid probate by transferring the title of your home directly to a family member or significant other. Probate court can be very costly and time-consuming, and while some states have streamlined this process, many others haven’t. If you want to transfer other properties that might be out of state, you’ll be able to avoid probate in those jurisdictions as well. Another advantage is it gives you future incapacity protection, which means if you become ill or unfit to manage your own finances, another trustee can be selected to manage your trust and protect your home. The final advantage is it gives you the opportunity to save on estate taxes. Of course, this depends on whether the trust is designated properly and the financial plans for your estate have been constructed efficiently.
Consider these factors carefully before making a decision.
Consider these factors carefully before making a decision. If you have any more questions about any real estate topics or you’re thinking of buying or selling a home in the Palm Springs area, don’t hesitate to give us a call or send us an email. We look forward to helping you.
Why work with just one agent when buying and selling a home? You can turn both transactions into one smooth process. Here's how.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
When you're looking to buy a home, working with just one agent will be very beneficial to you.
You want a single, trusted advisor who truly understands what you're looking for in a home. You'll come across many agents early in your search, and it's important to pick the one you connect with best. You should feel that they will represent you and your interests best.
Aligning yourself with a single agent creates continuity in your search and prevents you wasting time being shown the same home multiple times. Agents don't get paid unless they find you the home of your dreams and close on it, which can be a long process. Your Realtor will work hard to understand your needs and find you the right home, as well as working in your interest to negotiate a contract and shepherd you through the closing process.
In return, all they ask is for your loyalty when you are searching for a home.
All an agent asks is for your loyalty when you start searching for a home. This just means calling your agent FIRST if you have questions about a property you see online, at an open house, or just driving around. All agents have access to the multiple listing service as a way to get exposure for our listings, and our MLS facilitates a cooperating agreement between all member agents and brokers. Unless you're talking about a pocket listing (not yet live on the market), we all have the same information.
The one agent you align yourself with should have knowledge in the areas you're interested in and who you feel will work in your interest to find your dream home.
If you have any other questions about real estate or you're thinking about buying or selling a home here in the Palm Springs area, you can always give me a call or send me an email. I'd be happy to help!
Contingent offers are making a comeback. Today we’ll explain why.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Contingent sale offers are on the rise in Palm Springs. Contingent sale offers occur when a buyer submits an offer on a property that is contingent on them selling their own home. If they don’t end up selling their home, they do not have to go through with the purchase.In 2003 and 2004, we saw a huge surge of buyer demand in the market. It was difficult for contingent buyers to get their offers accepted because in some cases, sellers would have 20 or 30 different offers to choose from.During the housing market crash, many people were unable to sell their home, meaning any contingent offers were frowned upon because sellers weren’t confident that these buyers would end up selling their homes. Between 2011 and 2013, we saw another boom. However, equity hadn’t quite gone up enough for some sellers to feel comfortable with pulling the trigger.Now, the market is more stable, sellers have enough equity to feel confident in buying a new home, and more and more contingent offers are coming back into play.
As a contingent buyer, it’s best to make a contingent offer after your home is already in escrow. If you try to make a contingent offer on a property when your home isn’t even on the market yet, the seller is less likely to accept it because of all of the unknowns. If the sale falls through while you are in escrow, your contingent offer protects you, and you’ll be able to get your earnest money deposit back.
If you’re a seller who receives a contingent offer, it’s important that the buyer has their home in escrow for the reasons mentioned above. It’s also important to determine where they are at in the process, i.e. have they just received an offer? Have the inspections been completed? Have all contingencies of their sale been removed by their buyer?Whether you’re a buyer or seller, know that contingent offers are no longer the red flags they used to be. If you have any other questions about contingent offers or anything else relating to real estate, don’t hesitate to give me a call or send me an email. I would love to hear from you.
Online home value estimators can’t always be trusted. There are three reasons you should take their information with a grain of salt. Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Online home value estimates might not be as reliable as you think. There are actually three reasons why you need to be careful when using them to determine value. First of all, online home value calculators are based on a formula. The algorithms used to create a value for a home are generally based on a specific set of factors such as the square footage and prior sales of similar homes in the neighborhood. While that can be a good starting point, homes are imperfect, and there is no human interaction with the property when the value is being assessed. Second, online estimates miss the details of your home. As noted, these tools can’t tell how lived in your home is. Online values won’t take into account if a home is covered in 1950s wallpaper or used to be a meth lab. On the flip side, they also don’t take into account any recent renovations or upgrades that may have been done to the home. The list price you would get from an online estimator would not include any value for amenities or the condition of the home.Finally, the online estimators are only guidelines. These estimates can give consumers false hope sometimes, so you need to keep in mind that you won’t get the true value of your home online. You should use the Internet to do your homework, but don’t get attached to the values or list prices given for your home or estimates for potential homes you may want to buy.
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The best way to find your home’s value
is to contact a real estate agent.”
If you are thinking about selling your house, you really need to consult a real estate agent. A real estate agent will come to your home and let you know exactly what affects your home’s value. They can also get more reliable comparable sales to ensure the value they give you for your home is as accurate as possible. If you have any other questions, please feel free to give me a call or send me an email. I look forward to hearing from you!
Whether you’re a buyer or seller, you need to know these three things about home inspections before ordering one.
Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Whether you’re a buyer hiring someone to inspect a home you want to buy or a seller needing an inspector to look at your home to see if there’s anything that needs to be fixed before you put it on the market, there are three things you need to know about home inspections:
“
Knowing these three things is
essential to understanding
home inspections.”
1. You can choose any home inspector that you like. Your Realtor usually has several inspectors they’ve worked with, and they can be a good source of recommendations. You can also look for one on your own. In either case, it’s important to look for an inspector who’s a member of the National Association of Home Inspectors because they must complete an approved home inspector training program, demonstrate experience and competence as a home inspector, complete a written exam, and adhere to the NAHI standards of practice and codes of ethics. 2. Home inspections are intended to point out adverse conditions—not cosmetic flaws. A home inspector will point out conditions that need repairs and/or potential safety-related concerns regarding the home. They won’t comment on cosmetic items if they don’t impair the integrity of the home.They also don’t do destructive or invasive testing.3. Home inspection reports only include the basics. On the home’s exterior, this report should include the steps, patios, decks, chimneys, roofs, windows, doors, the pool condition (if requested), and all operating components. Inside, they’ll look at the attic, electrical components, plumbing, central air conditioning and heating (including the ductwork), crawl spaces, and garages. They report on the working order of most items including the faucets to see if they leak or garage doors to see if they open properly. They’ll also note the presence or absence of state and locally mandated retrofits such as hot water heater strapping or the presence of a carbon monoxide and/or smoke detector. Inspectors may also point out termite damage and suggest you get a separate pest inspection. The final written report should be concise and easy to understand.
If you have any questions about this or any other real estate-related topic, please feel free to give me a call or send me an email. I’d be happy to help!
What's going on in the Palm Springs market? I've pulled the numbers to give you a comprehensive look at how our market changed last year and where it's headed in 2017.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
What's been going on in the greater Palm Springs area real estate market?With 6.3 months of sales, our market is balanced. This is part of a positive trend, though, as it is one month less than it was at this time last year. Remember, six months of sales (or absorption rate) is a balanced market. A higher number would favor buyers, and a lower number favors sellers.If we look at the absorption rate by price range for all Coachella Valley area cities, we can see that the highest absorption rate is for properties listed over $1 million at 18.7. That means it would take 18.7 months to sell all homes listed at $1 million or above if no other home came onto the market. This is also a positive trend. At this time last year, the absorption rate in this price range was 20.9 months.As you can imagine, the lower price points have a lower absorption rate because there are more buyers who qualify for those types of properties. Homes priced below $200,000 have the lowest absorption rate at 3.2 months of sales, which is also lower than last year when the rate was 3.9 months.As of January 1st, inventory for the entire Coachella Valley stood at 4,585 units, which was 10% lower than this time last year. However, it's exactly the same number of units we had on the market on January 1st, 2015. Much of this is the result of higher sales volume numbers in the last few months of last year compared to a year ago.At $340,000, our median price for detached homes for the whole Valley is effectively unchanged as of January 1st from last year at this time. However, this year's change in the median price for Valley condos has increased about $2,000, or just under 1%. The yearly change in the median price of individual cities shows a really positive trend for detached homes, but a slightly negative bias for condos. Palm Springs and Desert Hot Springs continue to be the Valley's leaders with 8.1% and 15.6% gains, respectively, while Palm Desert and Rancho Mirage each experienced year over year reduction of values.After a period of stagnation in our market, the growing trend in long-term sales volume in both detached homes and condos is a very positive indicator in our market. Condo sales rose 9% year over year and detached sales rose 2.8% from last year. Since the Fed’s interest rate increase in December, interest rates are still hovering around 4% and slightly higher. Inflation is expected to increase in 2017, and as inflation increases, bond prices move lower, and mortgage rates typically increase. Most experts, however, don't expect interest rates to go above 5% in 2017.“
We think the market will remain strong, making it a great time to buy or sell in Palm Springs.”
Interest rate volatility along with market uncertainty is expected with the new presidential administration, but the economy seems to be strengthening. We're predicting that our real estate market will continue to improve overall, which makes now a great time to buy or sell a home in the greater Palm Springs area.
If you have any other questions for me or there are topics you'd like to see me cover in a video, don't hesitate to give me a call or send me an email. I look forward to hearing from you!
If a home appraisal comes in lower than the sales price in the middle of a transaction, what should you do? Here are your three options.Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*
Low appraisals can be a real challenge in our market today. Low appraisals have become more common because our home prices have been appreciating quickly over the past several years and there are fewer and fewer comparable properties. It seems that each sale is higher than the last. So what is an appraisal? It’s a price that a willing buyer and seller will settle on. In reality, a home must be sold to three different groups: the buyer’s agents, the buyers themselves, and the mortgage lenders. The brokers help us find the buyers for your properties, the buyers have to feel that the sales price is justified, and the lenders have to agree on the value because they’re the ones putting up most of the money for the house.
“
If the appraisal comes in low,
you have three options.”What happens if your appraisal comes in low in the middle of a transaction? There are three ways to proceed:1. The buyer can terminate the contract.
2. The buyer can pay the difference in cash. If the buyer wants to move forward with the transaction, they can pay the difference between the appraised amount and the contract price to proceed.
3. The seller and the buyer can negotiate. If the seller and the buyer meet somewhere in the middle, the transaction can continue. If the seller still feels that they are getting the value they want out of their house, they may reduce the price to the appraised price in order to keep the transaction moving.
Because this is such a complicated process, it’s imperative that you have a great agent on your side to help you through the transaction and go to bat for you. We have experienced all of these situations and are here to negotiate on your behalf.On a side note, with the Thanksgiving holiday upon us, I just wanted to take this opportunity to let all of you know how much I appreciate your support. I’m thankful for the trust that you’ve put in me and my team this past year, and it’s been a privilege sharing these real estate tips with you. For those of you who we’ve had the pleasure to represent in the purchase or sale of a home, we are especially grateful. Have a wonderful Thanksgiving!If you have any other questions about your options in the event of a low appraisal or any other questions about buying or selling a home in the Palm Springs area, feel free to reach out to me by phone or email. I’d be happy to help you!
There are four real estate myths that, unfortunately, too many people believe. Some of them could even cost you a lot of money.
Buying a home? Click here to perform a full home searchSelling a home? *Click here for a FREE Home Price Evaluation*There are four major real estate myths that I wanted to debunk for you.1. Realtors get kickbacks from lenders, home inspectors, and other referrals. This is not only untrue and unethical but according to the Real Estate Settlement Procedures Act (RESPA), it’s also against the law. No professional Realtor is going to jeopardize their career or reputation just for a kickback. Most agents, however, will give you recommendations for vendors like lenders or inspectors because they build professional relationships with these people and they know that they’re good at what they do. It only helps to ensure a smooth transaction for everyone involved.
“
Realtors won’t jeopardize their career
just for a kickback.”2. You should choose the listing agent that says they can sell your home at the highest price. Choosing an agent that understands the current market and prices your home accordingly is crucial. Pricing your home too high only means that it will sit on the market longer, you’ll get fewer showings, and receive fewer offers. You’ll most likely end up dropping the price and wasting valuable time. You can price a home at whatever you want, but the fact is, a bank will only loan on the appraised value of the home, and your home will only sell for what someone is willing to pay for it.3. Real estate agents want you to pay a higher sales price so they can get a higher commission. Realtors are honest professionals who, more than anything, want you to get the home of your dreams at the best possible price. In California, by law, a buyer’s agent is obligated to act in your best interest. Many factors go into consider the offer price on a home, and your agent will work with you to determine the best offer amount. For example, if you’re in a multiple offer situation, you may considering making a strong offer to give yourself the best chance to get your offer accepted. 4. A cash offer is always the best offer. While a cash offer is always a strong offer, it’s not always the best offer in the eyes of a seller. There are many crucial elements of an offer that need to be analyzed by a seller, such as the financing terms, contingencies, and time needed to close. For example, a conventional offer with no contingencies may be the seller’s best offer when compared to a full-price cash offer with a contingency of the buyer’s home needing to sell first. Thanks for visiting the blog today! I hope you found this information helpful for your next real estate transaction. If you have any other real estate-related questions, always feel free to call me or email me. I’d love to hear from you!
Today we’re going to talk about one of the reasons that mortgage interest rates are so low right now.
At the beginning of the summer, the U.K. voted to leave the European Union. This became known as "Brexit," and it has created a lot of uncertainty and worry for our neighbors across the Atlantic.
Here in the U.S., though, Brexit has been nothing but good for our real estate market. Because of Brexit, investors all over the world want a safer place to invest, and this has pushed already-low mortgage interest rates down even further because they are investing in our housing market.“
Here in the U.S., Brexit has been
nothing but good news
for mortgage rates.”
In fact, we are now in the middle of the second-longest run of cheap mortgage rates in history. Currently, the 30-year fixed-rate mortgage is 3.46%; this is only a few points above its all-time low of 3.31%.
What does all of this mean for you?
First, if you are looking to buy a home, now is an unusually good time to do so because these low rates mean you will be paying less. As an example, if you were to take out a 30-year, $250,000 mortgage today versus a year ago (when interest rates were almost 4%), you would save more than $25,000 over the lifetime of the loan.
Another way to look at it is that at today’s rates, you can afford a more luxurious home without paying more. For example, if you were to take out a 30-year mortgage, you could now afford $15,000 more for a home than you could a year ago while keeping the same monthly payments.
Clearly, this is a great opportunity.
If you’re curious about which homes are available for sale in the greater Palm Springs area right now, check out the “search all homes” link above to get a list of available homes.
Now, if you are looking to sell rather than buy, these low rates also benefit you big time. The more the mortgage rates drop, the larger the population of qualified buyers is, and the greater the demand is for homes.
This healthy demand keeps up the price of your home and ensures your home will get sold quickly. Not surprisingly, pending home sales are up by 1.3% this summer and are now at the second-highest level in over a decade.
If you’d like to know how much your home might be worth in the current market, I have a great tool I’d like to share with you called Market Snapshot. To use this tool, simply enter your address and some attributes of your home, and then we will provide you with a list of all of the homes that are currently on the market in escrow and homes that have sold in your specific area. This will give you a good idea of the value of your home.
As you can imagine, these ultra-low mortgage rates won’t last forever and will rise sooner or later.
If you are looking to take advantage of this unique situation while it lasts, give me a call or send me an email anytime. Whether you’re looking to buy or sell, I’m here to help you.