What Does the Future Hold for Home Prices In La Quinta?

Here in the Coachella Valley, we have seen a steady rise in home prices over the past few years. This price surge is the result of more active buyers in the market than there are homes listed for sale. This mismatch between supply and demand means that housing affordability will be an increasingly important consideration for buyers. The main cause is an influx of buyers from surrounding areas that are looking for more affordable homes with more amenities than they can afford in their current metropolitan areas. 

In 2021 the Coachella Valley saw a 20.2% appreciation rate and La Quinta saw a 34.3% increase year over year. In 2022, most experts are forecasting continued price increases, just at a slower pace. During this same time, rents have risen by 13.6%, so making the decision to buy versus rent may give buyers the opportunity to purchase a home before prices increase further. By locking in a monthly mortgage payment now, owners can avoid the future projected rent increases. The good news for prospective buyers is you can rest assured that your investment in your home will be an asset that increases in value over time which boosts your long-term wealth gain through equity. Thus, purchasing a home may be the relatively more affordable housing option for many at this time. 

If you are hoping to buy a home today in La Quinta’s highly competitive market, it’s extremely important to make your offer stand out. If you’ve gotten advice from someone who’s purchased a home before, know that what has worked in the past may not ring true any longer.  Today’s buyers shouldn’t shop for a home and expect to negotiate a lower sales price. If you’ve found your dream home, you need to be realistic about today’s housing market. Most listings will receive multiple offers, above asking price, very soon after they are placed on the market. So, today’s asking price often represents the floor of the negotiation rather than the ceiling. 

Another thing to consider is that today’s interest rates still give buyers a great opportunity to buy. Many buyers ask, how will the current interest rates affect me? Let’s put it in perspective, even though rates today have climbed back into the 4% range, they are still incredibly competitive. Based on historical data from Freddie Mac, today’s rate is still lower than the average interest rate in each of the past five decades. So, buying now still makes sense. Although, experts expect the rates to continue to rise. Thus, the longer you wait, the more it will cost per month to borrow the same amount of money to buy the same home which decreases your purchase power. 

Being educated and informed on the home buying process will help you to make the best possible decision about when to purchase a home. The bottom line is that even if more sellers were to list their homes this season, it will still be a highly competitive market. Be ready to act quickly when you find the right home for you.