Local real estate market experts, Market Watch LLC just released their 2016 year end Coachella Valley Housing Report on a city-by-city basis.  Some of their findings are as follows: 

CATHEDRAL CITY

  • Population and Households: Cathedral City is the second largest city in the Coachella Valley, with a population of 54,261 individuals forming 17,389 households.
  • Population Growth: Cathedral City’s population has been growing at the rate of 500  new residents a year over the past five years (slightly less than 1% population growth per year), but this increase appears to be slowing.
  • Ownership and Mortgage Rates: Cathedral City’s home ownership rate (the percent of households that own rather than rent a home) is 60%, just 3% less than the Valley average of 63%, which happens to be the national home ownership rate. Sixty six percent of owner occupied homes have mortgages, which is slightly less but comparable to the California average of 71%.
  • Second Home and Remote Ownership Rates: Census department numbers give a second home index of 18%, which is above the 7% state average but still relatively low compared to the Valley average, making it primarily a residential type housing market. When we look at the remote ownership (i.e., ownership by a second homeowner or investor who rents the property) of both detached homes and condos, 36% or just over 1/3 of detached homes are remotely owned, while condos have a very high (but somewhat normal for the Valley) remote ownership ratio of 76%.
  • Median Price and Price Changes: The Cathedral City median price in 2016 was $275,000 for detached homes and $159,900 for condominiums, both up about 2% over 2015 prices. Over the last five years, the median price of detached homes in Cathedral city is up 83% while for condos it’s up 60%. These are some of the highest gains in the region and in Market Watch’s opinion reflect the fact that prices went a lot lower here five years ago during the very heavy foreclosure problem.

 THE CITY OF COACHELLA 

  • Population and Households: The City of Coachella’s population is 45,407, with 10,429. Households, producing an average of 4.5 persons per households, which is rather high when compared with the California state average of 3 persons per household
  • Population Growth: The growth rate for the population of Coachella City has been 2% per year over the last five years, which is one of the highest in the Valley.
  • Second Home and Remote Ownership Rates: The second home index is 7%, which equals the average for all of California. Its market is almost 100% residential. The city really has only detached homes, there are very few condominiums. Of the 6,733 detached homes in Coachella City, 26% are remotely owned, primarily by investors, many of whom swept into the Valley during the foreclosure period to pick up rental bargains.
  • Median Price and Price Changes: The median price for 2016 was $230,000, which represents a 4% gain over the previous year. The increase over the last five years has been 83%. Sales this year at 172 units were effectively the same as last year which produces a very low sales per resident number than in more active markets like La Quinta or Palm Desert.

DESERT HOT SPRINGS

  • Population and Households: Desert Hot Springs' population is just over 29,000 individuals in 9,000 households, producing an average persons per household ratio of 3.2 ( slightly higher than the national average of three persons per household).
  • Population Growth: The five year growth rate in Desert Hot Springs, which had been running around eleven percent, fell to 6% with the latest release by the California Department of Finance.
  • Second Home and Remote Ownership Rates: While a second home index of 18% shows that Desert Hot Springs does have a second home component, Market Watch concludes that it is primarily a residential market with a high rental factor. Sixty eight percent of its owner occupied homes have mortgages, which is slightly under the California average of 71%. Of its 701 condominiums, 93% are remotely owned while 47% of its 10,000 plus detached homes are remotely owned. According to Market Watch, the relatively low 2nd home index but high remote ownership numbers show that many of the remote owners are renting their homes and not using them.
  • Median Price and Price Changes: The median price of detached homes in Desert Hot Springs in 2016 was $180,000, which is a 9% gain over the previous year and a whopping 111% gain over the median price five years ago. However, it should be remembered that the median price five years ago of $97,000 was heavily depressed, the result of having an 80% foreclosure rate.

INDIAN WELLS

  • Population and Households: Indian Wells’ population is only 5,412 formed into 2,798 households with a person to household ratio of 1.9. The average income of its residents is $166,000 and this does not include the income of longer term visitors who come and use their second homes. Past studies have indicated it is considerably higher.
  • Second Home and Remote Ownership Rates: Of Indian Wells’ 1749 condominiums, 74% are remotely owned while 67% of its 2,943 detached homes are also remotely owned. The census ratio we call the 2nd home index is 49%; which is seven times the California average of 7%. Market Watch notes that Indian Wells is a small but very high end city with by far the largest second home index and remote ownership percent for detached homes compared to the other eight Valley cities.
  • Median Price and Price Changes: The median price for detached homes in Indian Wells in 2016 was $849,500, which was a 2.4% increase over 2015 and a 23.6% increase over five years. Sales of detached homes were 173 units which is up 8%. For condominiums the median price was $414,500 with 87 units sold. The high end price index for Indian Wells, which is the average price of a 4,250 square foot home over the year, was $1,504,079 down 2.9% from 2015 but up 8% over the last five years.

INDIO

  • Population and Households: Indio is the largest of all 9 cities in the Coachella Valley, with a population of 88,058 in 26,144 households, for an average of 3.4 persons per household. The average household income is $66,218 a year in Indio.
  • Population Growth: Indio has one of the fastest population growth rates with a 14% increase over the last five years, which includes a 5% increase in 2012 alone.
  • Ownership and Mortgage Rates: Indio’s home ownership rate of 64% is just 1% above the national average and its second home index is very similar to that of Desert Hot Springs Desert at 17%. Sixty eight percent of owner occupied homes have mortgages, which is just a few percent less than the average in California.
  • Second Home and Remote Ownership Rates: Of the 13,528 detached homes in Indio, 99% are owner occupied and just 1% remotely owned. Of the 8,572 condominiums, 12% are remotely owned while 88% are owner occupied. These very high owner occupied numbers make Indio the largest residential market of the nine major cities.
  • Median Price and Price Changes: The 2016 Indio median price of $285,000 was a 1.8% increase over the previous year and a 70% increase over the median price five years ago. Sales rose 4% while dollar sales, at $353 million, was an 8% increase over the previous year.

LA QUINTA

  • Population and Households: La Quinta has a population of 39,977, with a consistent growth rate of 1.6% per year for the last ten years. The population forms into 15,200 households for a ratio of 2.6 persons per household, slightly less than the California average of three per household. The average household income is $103,000, 11% higher than the California average of $91,757.
  • Ownership and Mortgage Rates: Sixty nine percent of the owner occupied homes have mortgages, which is effectively equal to the average throughout California.
  • Second Home and Remote Ownership Rates: The census department’s 2nd home index for La Quinta is a relatively high 37% compared to the California average of just 7%. Riverside county shows La Quinta has 16,768 detached homes with a 52% remote ownership rate, while an 82% remote ownership rate for its 3,830 condominiums.
  • Median Price and Price Changes: The La Quinta median price of detached homes in 2016 was $449,000 and the median price per sq. ft. was $196, up 6.9% and 1% respectively. The average price of a 4,250 square foot home in 2016 was $1,481,975, up 2.7% from the previous year. Unit sales were down .6% while in dollar terms they were up 8%. The median price of condos was $325,000 with unit sales, at 264 units, was up 23%.

PALM DESERT

  • Population and Households: Palm Desert has a population of 49,335 individuals forming 23,925 households for a very low ratio of just over two persons per household. This is the second lowest of the nine cities, equal to the ratio in Palm Springs, and slightly lower than Indian Wells’ ratio of 1.9 persons. The average throughout California is three persons. The average household income in Palm Desert is $81,026.
  • Population Growth: The population growth for the city has been running very low, less than 2/10 of one percent per year over the last five years.
  • Second Home and Remote Ownership Rates: The census department’s second home index for Palm Desert is a relatively high 39.2%. This is confirmed by County ownership records, where 54% of the city’s 11,648 detached homes are remotely owned, while 74% of its 14,186 condominiums also have remote owners.
  • Median Price and Price Changes: The median price of detached homes in Palm Desert in 2016 was $373,000. This is a 1% increase over 2015 and a 30% increase over the last five years. Likewise, the median price per sq. ft., of $197 was a 3.5% gain over 2015 and a 37% gain over the last five years. The high end index, which measures the average price of a 4,250 sq. ft. home was $1,450,780, up 6.3% and 36.5% respectively over one and five years. The median price for condos was $267,750 while sales for both detached and condos rose 5.6% and 8.1% respectively.

PALM SPRINGS

  • Population and Households: The population of Palm Springs is 46,654 forming 23,163 households for a ratio of two persons per household. 
  • Population Growth: The population growth of Palm Springs continues with a five year growth rate of 3.8%.
  • Second Home and Remote Ownership Rates: The census department’s 2nd home index of 36% is comparable but just slightly less than the 39% for Palm Desert. The county ownership records show almost identical remote ownership records with Palm Desert and there is no doubt these two cites lead the Valley in remote ownership numbers. Of the 13,499 detached homes in Palm Springs 54% are remotely owned while of the 13,431 condominiums, 74% are remotely owned.
  • Median Price and Price Changes: The 2016 median price for detached homes in Palm Springs was $564,950, which was a 4.8% increase over 2015 and a 61.4% increase over the median price five years ago. The median price per sq. ft. was $287 up 7.8% from 2015 and 63.5% over the last five years. The high end index for 2016 was $1,680,025 up 11.5% from a year ago and 65.4% over five years. The median condo price was $229,000, up only 1.8% for the year but 72.8% over the last five.

RANCHO MIRAGE

  • Ownership and Mortgage Rates: The Rancho Mirage home ownership rate of 78% is very high and unchanged from the previous year.
  • Second Home and Remote Ownership Rates:  According to Market Watch,  Rancho Mirage is one of California’s primary second home markets. This is indicated by the city’s second home market index of 41.4%, which is over five times higher than the California state average of 7.8%. This Census Department statistic is confirmed by County assessor data which show that 52.5% of detached homes and 70% of all condominiums are not owner occupied but are remotely owned.
  • Median Price and Price Changes: There was a very slight downward bias in Rancho Mirage’s 2016 median price and price per square foot. The five year change, however, shows a 23.5% increase for detached homes but only a 1.7% increase for condominiums. Market Watch observed that in 2016 both unit and dollar sales for detached homes in Rancho Mirage increased 7% and 8% respectively. So did condo sales, which increased 10.4% in unit numbers and 8.5% in total dollars. Unit sales growth in detached homes was primarily in the $400k to $599k and $1M plus price brackets, while in Condos the increase was in the $200k to $399k price bracket. Market Watch’s proprietary high end price index of $1,181,627 for Rancho Mirage in 2016 shows a five year increase of 15.3%.

Analysis and data produced for Coachella Valley agents through the sponsorship and cooperation of the Palm Springs Regional Association Of Realtors® (PSRAR) and California Desert Association of Realtors® (CDAR) by Market Watch LLC ©2017 CDAR & PSRAR.  All rights reserved.  Use and distribution by members only