December 21st, 2011
Warning for Canadian Buying real estate in the US
Canadian media are creating a panic wave among the people in Canada who are thinking of investing in real estate in the US. Mainly talking about the “risks” and “pitfalls” for tax issues and really scaring off everybody.
These articles are great and of great use but the way they are written and presented is “scaring” potential buyers away.
As a Realtor in Palm Springs California (sunny and warm during the winters) , a snow birds destination, I have sold tens of properties to Canadians since the turn of the economy.
Everything I am reading in this article bring nothing new to my table, I always recommend to my clients to consult a cross border accountant before they buy.
But this is not meant “against Canadians” as it appears to be in everything I have read lately in the Canadian media. This is the way real estate is taxed and legislated in the US for US residents and citizens as well.
This why the buyers should carefully chose a Realtor who is not just a “door opener” for them but a knowledgeable professional who will walk them through and guide them.
Buying real estate in Palm Springs today (because it is a resort area) still remains an excellent investment for now as well as the years to come as long as you do it the “right way”.
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December 16th, 2011
Buyer losing opportunity of a great real estate deal in Rancho Mirage
Another buyer suffering for the same disease most buyers are afflicted with, is now full of remorse and anger. Here the story
- the property is located in one of the prestigious communities in Rancho Mirage
- the home is now owned by a bank
- the listing on the market for way over a year
- a potential buyer (very interested) writes an offer at 20% under the asking price
- the seller comes back with a counter at 9.5% under the asking price
- the buyer “plays” and comes back at 10% under the asking price (just had to “squeeze” a little more)
- meanwhile another potential buyer (Murphy’s law) shows interest
- the first buyer is made aware that there is another offer coming
- the second offer comes back at 4% under the listed price and better conditions all together
- the seller accepts the second offer
WOW! now the first buyer is panicked and is READY to sign the first counter offer he received from the bank and is ready to be as a back up offer just to have the hope of maybe buying that home that he so much wanted..
It might take another year or more before they find a home that they like that much within their price range.
Buyers in Palm Springs or Rancho Mirage or any other city in the Desert, please be aware that yes when looking at high end properties that you can afford : you are not the only ones in that position. Other people can also afford to buy. By the way this is true for any price range and any kind of property.
As your Realtor I would always tell you , yes it is OK to try but when you get a counter (especially from a bank) look at it seriously and if you like the property enough just take it. Most of the time there is another offer, always higher right behind and the seller will of course accept it without even giving a second chance to that first offer.
I call it a disease because it is stronger than what your realtor can tell you, it is stronger than the interest you have for that home, and it will leave you unhappy and frustrated once it is over.
I am so sorry to see it happening again and again. Please trust your Realtor who understand how things works, who generally has inside information that he/she cannot share with you but that they will use to get you where you want to be. BECOME THE OWNER OF THAT HOME.
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December 12th, 2011
As Realtors in California we take it for granted that people from out of state or even from Canada (where an accepted offer commits you to the transaction) know about this. But no! They don’t and it always comes as a surprise.
YES EVEN WHEN YOUR OFFER HAS BEEN ACCEPTED AND WE “LOCKED IN THE DEAL” YOU AS BUYERS STILL HAVE THE RIGHT TO CANCEL THE TRANSACTION.
For the “regular/equity” sales, you are allowed 17 days (unless during negotiation of the offer this time frame was changed) to “remove contingencies” and that means that you can cancel at anytime within that time period.
For the bank owned properties, traditionally the buyer has 7 to 10 days to remove contingencies and commit to the transaction.
In both cases, if you decide to “pull out” of the transaction (escrow), your deposit will be refunded to you less expenses if there have been any.
So when I contact you and tell you I have seen a deal for you that you should not miss, you can take the opportunity to write an offer site unseen and potentially change your mind later.
I hope, this should give you more incentive and less concern to write offers on properties you like.
Contact us for more information and questions.
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December 5th, 2011
Here are the numbers covering the sales for November and comparison month over month for Palm Springs and the Desert Cities.
The comments next to the numbers should help you better understand that our market is a micro market and what applies to most of California does not apply to beautiful Palm Springs.
November 2011 results
Total homes sold : 385 a 7% month over month decrease
There were more potential buyers who were not ready to pay the market price for the homes they looked at and they went home without buying.
Median price for condos : $222,100 almost 7% decrease – 3 times as many bank owned sold in that category brought the median price down.
Median price for single family : $497,580 huge increase due to high end homes sold in Indian Wells.
Total Bank Owned (REO’s) sold : 79 a 15% decrease reflecting the fact that less Bank Owned inventory on the market.
Total Short Sales sold : 55 the same number reflecting the same decrease as total sale
Total Bank Owned (REO’s) active in December 2011: 167 a 9% month over month decrease
Total Short Sales active in December 2011:237 a 9% month over month decrease
Total Inventory for the cities we cover : 3169 a 9% month over month decrease.The inventory is really low, so when you are here, you need to understand that if you are not ready to pay the price, someone right behind you will. The inventory for short sales + REOs is just about 13% of the total inventory, this is slightly down compared to last month.The number of distressed properties in the cities we cover has come down.So prices WENT UP
|
| Cities |
MedianPrice
condos sold |
Price/sqft
condossold |
Total
condos |
MedianPrice
singlefamily |
Price/sqft
singlefamily |
TotalSingle family |
Total
sold |
Sold REO’s |
Active REO’s |
| Palm Springs |
137,000
|
116.32
|
54
|
365,000
|
183.57
|
79
|
133
|
30
|
44
|
| RanchoMirage |
285,000
|
171.96
|
11
|
567,500
|
200.66
|
26
|
37
|
9
|
22
|
| Palm Desert |
212,000
|
144.84
|
39
|
302,500
|
166.16
|
54
|
93
|
15
|
52
|
| Indian Wells |
297,500
|
140.34
|
4
|
1,175,000
|
346.26
|
11
|
15
|
1
|
9
|
| La Quinta |
179,000
|
140.51
|
9
|
313,000
|
161.08
|
81
|
90
|
24
|
39
|
| Sun City |
|
|
|
262,500
|
154.27
|
17
|
17
|
0
|
|
Numbers for October 2011
|
| Cities |
MedianPrice
condos sold |
Price/sqft
condossold |
Total
condos |
MedianPrice
singlefamily |
Price/sqft
singlefamily |
Total SFR |
Total
sold |
Sold REO’s |
Active REO’s |
| Palm Springs |
123,000
|
112.37
|
49
|
285,000
|
178.51
|
67
|
116
|
24
|
52
|
| RanchoMirage |
215,000
|
118.15
|
14
|
366,000
|
185.02
|
40
|
54
|
14
|
24
|
| Palm Desert |
168,000
|
118.31
|
39
|
270,000
|
163.89
|
49
|
88
|
34
|
59
|
| Indian Wells |
400,000
|
143.58
|
2
|
624,000
|
225.99
|
14
|
16
|
4
|
9
|
| La Quinta |
297,094
|
154.76
|
14
|
249,000
|
138.84
|
66
|
80
|
29
|
40
|
| Sun City |
|
|
|
257,000
|
143.58
|
7
|
22
|
1
|
2
|
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November 22nd, 2011
Interesting results I wanted to share with you regarding Palm Springs Real Estate
Here are the statistics covering ONLY the cities of : Palm Springs Proper, Rancho Mirage, Palm Desert, Indian Wells, Sun City Dell Webb and La Quinta.
The numbers in the chart are showing the sales for April 2011 compared to October 2011. The table also shows the inventory in April compared to inventory up to date.
The total number of sales are 62% lower. This is “normal” because April would reflect the sales which happened during the month of March which is the height of the season while October shows the sales that happened during September which is still our low season.
What is important is that prices did not drop more than 1% which shows a stable market at the lower end.
On the other hand , in the high end market, the median price dropped almost 26% (but only 4 homes sold)
Inventory :There is 50% less inventory for condos below 200K and 14% less inventory for single family homes below 300K : so the lower end is selling fast
Percentage of distressed properties active : 30% at the lower end below 200K and only 5% at the higher end of the market
This season has already started strong, this is still a buyers’market – money is cheap out there.
Maybe some of your friends want to buy…let us know JJ
|
Total Sold April
|
Total Sold October
|
Distressed Properties
Sold April
|
Distressed Properties Sold Oct.
|
Median Price Sold
April
|
MedianPrice Sold
October
|
Total Active April
|
Total Active
Oct.
|
Distressed
Properties
ActiveNov.
|
% Distressed
inventory
|
Condos up to
200K |
108
|
79
|
47
|
39
|
125,000
|
114,000
|
785
|
393
|
119
|
30%
|
Condos 200K
and up |
129
|
39
|
8
|
5
|
285,000
|
280,000
|
576
|
877
|
50
|
5.7%
|
Single Family
up to 300K |
135
|
125
|
59
|
67
|
185,044
|
197,500
|
523
|
439
|
151
|
34%
|
Single Family
300K to 600K |
114
|
70
|
19
|
17
|
437,931
|
426,500
|
777
|
687
|
95
|
14%
|
Single Family
600K to 2M |
77
|
45
|
3
|
13
|
808,000
|
806,000
|
938
|
772
|
41
|
5.3%
|
Single Family
2M and up |
8
|
4
|
2
|
0
|
3,200,000
|
2,350,000
|
259
|
197
|
5
|
2.5%
|
| Total |
569
|
362
|
121
|
141
|
|
|
3858
|
3365
|
|
|
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October 5th, 2011
Market Update for Palm Springs September 2011
The numbers are encouraging (for us and for the economy) because they show some increase in prices, fewer bank owned sold and fewer bank owned on the market. This confirms what we talked about last month regarding the banks shying away from foreclosures. They are trying to help the homeowners by slowing down the process and asking them to try and sell the distressed properties as short sales. This is why we are seeing more short sales on the market and more short sales selling. The banks are making efforts to process them faster.
I am showing you, below, the results for the month of September 2011 and comparing month over month with August 2011. As well, I am also giving you the numbers comparing year over year.
One thing is sure, properties are selling and prices are not “crashing”. Let’s talk.
So the weather is really cooler at under 85 degrees today and it might be just time to call us and set an appointment to buy a property in Palm Springs before the big seasonal rush .
MONTH OVER MONTH
September 2011 results versus August 2011 as usual green for better results red for worse.
Total homes sold : 390 versus 434 a 10% month over month decrease (normal reflecting the sales for August which is our hottest month)
Median price for condos : $224,600 versus $210,035 almost 7% increase
Median price for single family : $358,750 versus $350,358 a slight increase
Total Median price : $291,675 versus $280,196
Total Bank Owned (REO’s) sold : 95 versus 113 a 16% decrease reflecting the same as total number of sales
Total Short Sales sold : 56 versus 62 a 10% decrease reflecting the same as total sales
Total Bank Owned (REO’s) active in October2011: 188 versus 202 a 7% month over month decrease
Total Short Sales active in October 2011: 281 versus 250 – a 12% month over month increase
Total Inventory for the cities we cover : 3008 versus 2553 last month an 18%
month over month increase. The inventory for short sales + REOs is just about 16% of the total inventory, this is the same month over month. Short sales represent a growing number while the REOs number is shrinking.
YEAR OVER YEAR
Total homes sold in September 2010 : 329 compared to 390 in 2011
Median Price all in all in September 2010 : 296,413 compared to 291,675 in 2011
Total Bank Owned(REO’s) Sold in September 2010 : 107 compared to 95 in 2011
Total Bank Owned (REO’s) Active in October 2010: 304 compared to 188 in 2011
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September 20th, 2011
How is Real Estate doing in Palm Springs and the Desert Cities on Tuesday September 20th ?
88 New Listings – 25 Contingent (went into contract waiting for inspections) - 63 Pending (contingencies removed on the way to closing transaction)- 42 Sold (transactions closed)- 48 Back on the market (could have expired earlier)
So 130 homes are off the market compared to the 136 (88 + 48) that just came on the market .
Our inventory is shrinking – I am curious to see what will happen as we get closer to our season.
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September 17th, 2011
Mistakes housing investors make
With traditional investments delivering low returns, some are considering buying rental housing. However, potential investors should do their homework and avoid the following common mistakes.
Here are the SIX mistakes housing investors make. The traditional rent, investors would like to see is 1% of the sales price (an annual gross return of 12%), but after expenses it is more like 5% to 6% . Nothing wrong with that and certainly more than some other investment options.
- Mistake number 1 : confusing a cheap deal for a good deal.
It is true that you can buy some properties in certain areas at a ridiculously low price (generally in overbuilt deserted areas) – it does not mean that you can rent them out. In deserted subdivisions homes not attractive to buyers can also be not attractive to renters. But Palm Springs as a resort area offers properties (condos or free standing homes) generally in gated communities well kept and attractive.
- Mistake number 2 : overlooking key costs such as repairs and closing costs – as well as resale costs when time comes. But in Palm Springs , many of the homes are second homes and generally sold turnkey furnished ready to go.
- Mistake number 3: Forgetting that “time is money” – calculate the potential time of occupancy. But in Palm Springs, most of the “investment properties” rent only for the season (December thru end of April) at a price which is 2 to 3 times the price of a long term rental for the same size property. This would be equivalent to the return that long term annual rental would bring. And there are never enough of those rentals available
- Mistake number 4: assuming that you will sit back and collect money : tenants also lose their jobs and it is hard to get them out of the property. But in Palm Springs, seasonal renters pay you in advance for the whole length of their stay and you never have to deal with late payments or no payments.
- Mistake number 5 : underestimate repairs costs : advice : set aside 6 months of rent to cover repairs. In Palm Springs too this would have to be taken into account though your typical tenants are couples with no children, retirees coming to enjoy their winter here, eating out most of the time. Also you can always offer your cleaning team to maintain the home every two weaks and make it part of the conditions.
- Mistake number 6 : assuming that owning a rental is the same as owning a home: tenants are more demanding than owners and you might want to contract a management company But with seasonal rentals- a good concierge and cleaning company – your own advertising on www.VRBO’s.com is another option for management company.
NEW
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September 7th, 2011
This home is WOW! Very seldom you have such views so close to the Palm Springs Mountains.!
We’re sorry, but we couldn’t find MLS # 21435960 in our database. This property may be a new listing or possibly taken off the market. Please check back again.
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September 7th, 2011
August Market Update for Palm Springs Real Estate
Just comparing the numbers year over year, we actually are in the green and look better than we could think watching gloomy news.
the numbers below the video will demonstrate the point.
Total homes sold in August 2010 : 331
Median Price all inclusive : 315,653
Total Bank Owned (REO’s) sold in August 2010 : 99
Total Bank Owned (REO’s)Active in September 2010: 315
Total homes sold in August 2011 : 434
Median Price all inclusive : $286,578
Total Bank Owned (REO’s Sold in August 2011 : 113
Total Bank Owned(REOS’s) Active in September 2011:
Surprising…not that alarming after all?
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