If you were able to just look at the real estate market across California and nothing else, you might call it a banner year.
Of course, nothing in life is that simple.
No, 2020 was definitely one for the record books, across the Coachella Valley, California and indeed, the world.
The pandemic had a profound effect on the way the vast majority of us lived our lives this year, but somehow the real estate market not only persevered - it thrived.
Predictions at the beginning of the pandemic weren’t so rosy - there were a lot of unknowns. There was even a bit of a slow down in the marketplace amid this uncertainty in late Spring, as Summer approached. These fears turned out to be misplaced, as median sales prices registered growth of 10% compared to the previous July.
This growth was likely spurred on by an especially low inventory of properties, creating a lot of competition on available properties.
But now 2020 is done. Looking forward to 2021: What’s next for the Palm Springs real estate market?
And that’s exactly what many experts are predicting.
Mortgage rates aren’t showing any signs of going up anytime soon, in fact we may see them dip even lower.
And new construction has been slow to recover. After coming to a virtual standstill when many lockdown procedures went into full effect back in the spring, the market has a lot of ground to make up to keep up with rampant demand.
Low inventory and high demand for properties create ideal market conditions for the seller. Transaction are normally completed quickly and its much more likely that available properties will attract multiple offer situations, further driving up the final sales price.
Low mortgage rates are likely to keep buyers in the game in the early part of 2021, but this could change. If property values continue to rise, more and more buyers, especially first time buyers, could be pushed out of the market completely. Any increase to mortgage rates would only exacerbate the issue.
Migration Away from the Cities
A variety of factors brought on by the pandemic have only added fuel to a trend that has been growing steadily for decades - a movement away from America’s big cities.
In the past year, we’ve seen plenty of relocations from many of the more populated areas on the coast, including Los Angeles, San Diego and even the San Francisco Bay Area.
Reasons for making the move can vary, but less population density is a huge benefit of living in many areas of the Coachella Valley.
A renewed acceptance and support for remote work is also making it much easier to move to the Valley. Modern technology has made it easy for high tech workers from the Los Angeles area as well as Silicon Valley to keep their jobs and choose where they want to live.
Palm Springs has always been a prime location for those looking to invest in a second home or an investment property. Real estate is a pretty dependable investment and that's exactly what investors look for in uncertain times.
Plus, rock bottom mortgage rates have made borrowing money very affordable.
The summer months saw a pretty sizeable increase in the volume of investment property sales, compared to what we'd normally see.
The comparably low property prices of Palm Springs and the Coachella Valley make it especially appealing. Its stunning year-round climate, vibrant culture and amazing amenities have all contributed to its position as a top vacation destination in the United States.