Tis The Season

Tis the season, but maybe not how you’re thinking about “Season”.

What I’m referring to is the return of our neighbors, old friends and new friends, who missed our…..warm…..summer, who are beginning to arrive back in town, to relax, play golf and to settle in for the next 6-8 months.

Here are a some answers to questions I thought would be important for anyone who owns, rents, is looking to buy or sell a property, or is looking for property management input.

What does this “Season” have in store for us with property leasing and seasonal rentals? 

Our Property Management division has seen a rapid increase in property rentals beginning in August, and since the first week in October the market has been on fire. An example of this was seen in one of La Quinta’s communities, which in a 2 week span had over 13 properties listed for lease, and as of today has 3 properties remaining. The prices for yearly leases are holding strong, and in many areas have gained 10%-15% since last year.

Seasonal rentals are also moving quickly, to be expected, and we’re seeing a 10%-15% (some areas +/- 5%) price increase too; in the upcoming weeks as demand dominates supply, the prices will reach a premium. The key to reach a premium is to make sure your Property Manager is on top of keeping your property rented, and you’re not one of the cattle being herded to the slaughter.

What are the forecast of sales looking like?

The real estate market in the Coachella Valley has a typical economic life cycle:

1.    June-September: The market tapers off, listings are removed from MLS (to be re-listed), prices gradually decrease beginning in late May and early June.

2.    October-December: As our neighbors begin to return, in many instances prices decrease temporarily, due to old and new listings being put on the market, creating Supply to exceed Demand. The 2011 to 2012 season was a perfect example, and while the prices took a 10%-20% hit from June through December, the momentum rolled out a very good 1^st and 2^nd quarter for 2012.

3.    January-April: This is the prime time for sales in the Valley, especially at Resorts. Our last years’ numbers were very good, contrary to some articles playing up the Fear and Doom scenarios. Beginning in mid-April, we see a tapering down in the market as part-time residents and visitors return home.

4.    May: The winding down of the real estate season; sales which have been pending are usually closed during May, and there are some last minute properties that drop in price.

What other dynamics are going to play into this season’s market, and how do you know where a good “Win-Win” deal may be found?

There are always going to be Excellent to Poor areas to buy and rent real estate, and this is where a real estate professional and property manager can direct you in the right direction. Most importantly is a professional is one who’s been through more than 3 real estate cycles, and one who’s first-handed experience in property investing and property managing helps guide and not push what’s right for you!

I’ll be diving into this more in my upcoming blog articles; sign up to receive automatic updates, and if you have any specific questions just email me or call me at (760) 840-7441.

Have a great week, the weather is finally perfect, and the golf courses and almost ready from being re-seeded.

Tracy