For the first time in his 26 years as a licensed reale estate agent, Brady Sandahl is being confronted by three large audiences interested in buying a home in the Coachella Valley.
The coronavirus pandemic has shown homeowners that they don’t necessarily have to stay where they are to work, which has made the desert an attractive alternative to markets like San Francisco, Seattle, Portland and Southern California. Second, interest rates are at an all-time low at less than 3 percent. “That means people who have not been in the market for a home are now in the market,” Sandahl says.
And thirdly, the pandemic has placed a greater desire to drive to a second home rather than fly. “So those Southern California owners who would typically go west to Hawaii or south to Mexico are now driving east to the Coachella Valley,” Sandahl says.
Sandahl, who runs the Brady Sandahl Group at Keller Williams Luxury Homes in Palm Springs, recently was among a trio of real estate experts to speak on the commercial and residential markets during Webisode 5 of The Economic Future of the Coachella Valley Webinar Series. He was joined by Michael Meade of Wilson Meade Commercial Real Estate, and Peggy Sue Lane of First American Title.
The nine-part webinar series is a Palm Springs Life event in partnership with the Coachella Valley Economic Partnership and SBEMP Attorneys, and sponsored by Timo’s Air Conditioning and Heating.
However, there is only so much inventory to go around for buyers and Sandahl says it is “literally drying up,” in the valley. The solution would seem to be to build more housing, but the cost of land has risen coupled with all of the steps necessary to have a major development approved makes builders less likely to invest at this point. “You can’t really build for the market you’re in,” Sandahl says, “hoping the market will be around in three or four years.”
• READ NEXT: How Real Estate Plays a Role in The Desert We Want.
On the commercial side, Meade says the vacancy rate may rise a point r two to 10 or 11 percent, but he expects it to stabilize despite the impact on businesses that have had to close due to navigating restrictions from Riverside County health officials.
“We should be in the 6 to 7 percent vacancy factor for the Coachella Valley,” Meade says. “And we just didn’t get there since our last recession (in 2008). And so this pandemic is going to delay that and it could delay it for quite some time, but again, I don’t think its going to be as bad, in office space, as it will be in some other segments of commercial real estate.”
Lane, who has lived in the desert for more than 40 years, believes the Coachella Valley is primed for a stunning amount of expansion over the next five years.
“Once we get hospitality back online and people are invited to go back into an experiential economy, and play, they’re going to show up,” Lane says. “I’m not concerned abut the masses of people as it relates to, do they want to come to Coachella Music Festival. I think that growth is coming. I really do. And I think it’s a great time be in the Coachella Valley.”
• VIDEO: View Webisode 5 on Real Estate.