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2011-05-22 15:42:53
Valley home ownership holds firm

 The Coachella Valley's homeownership rate held steady over the past decade despite the recession and the addition of more than 53,000 new homes built over the years, new Census data shows.

 About 67 percent of all occupied homes in the Coachella Valley are owned by the people living in them, down a percentage point from a decade ago, the U.S. Census Bureau reported. 

The percentage of homes that owners occupy varied widely depending on the city, the 2010 Census figures showed.

In Indian Wells, for instance, the homeownership rate was 88.6 percent. In Desert Hot Springs, 47.2 percent of homes were owned by the occupants.

The measurement accounts only for occupied homes, Census Bureau officials said.

The actual homeownership rate would be lower if vacant homes were included in the calculation.

Economist John Husing with Economics & Politics Inc. said it's no surprise that more affluent communities such as Indian Wells, La Quinta and Rancho Mirage have higher owner occupancy rates.

The fact that the Coachella Valley added tens of thousands of houses and condos over the past decade also comes as no surprise, Husing said.

“This is about land — where the land is available,” Husing said. “One of the places with the most building in Southern California was the Coachella Valley. Particularly down-valley, places like Indio and La Quinta.”

La Quinta added 12,159 houses and condos over the past decade, the most in the valley. That edged out Indio, where 12,062 more homes were built.

Indian Wells added the fewest homes at 1,294, followed by Cathedral City's 3,102 housing units.

James Brownyard, chief operating officer with Palm Desert-based Desert Valleys Builders Association, recalled the boom years when 8,800 homes or more were being built every year. That's down to about 600 a year now, Brownyard said.

Census data

The 2010 census data showed 95,978 houses or condos in nine valley cities were owned by the occupants, compared to 62,234 in the 2000 census.

Coachella, Desert Hot Springs and Indio saw the percentage of owner-occupied homes rise over the decade, while Cathedral City, Indian Wells, La Quinta, Palm Desert, Palm Springs and Rancho Mirage showed declines.

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There were 45,489 renters in the 2010 census, up 12,219 from 2000.

Sara Sutachan, senior research analyst with the California Association of Realtors, said market conditions in many cities make for a “strong and compelling case” for homeownership.

Home prices are still well below historic highs of just a few years ago, and mortgage rates remain low, Sutachan said.

Sutachan estimated that a buyer who pays a 20 percent down payment and finances a $301,430 house with a 30-year fixed-rate mortgage at 4.62 percent would have a $1,590 monthly payment. Compare that to the $1,810 median rent on a three-bedroom, two-bath apartment with renter's insurance.

“That means buying a home would save the homeowner $220 per month when compared to renting, and the homeowner would save over $2,600 a year,” Sutachan said.

Additionally, that same homeowner who itemizes and deducts the mortgage interest would receive a tax deduction of more than $14,000 in the first year of ownership, Sutachan said.

Benjamin Leaskou, Realtor with Greater Palm Springs Realty, said some of his clients are purchasing homes at a bargain in upscale neighborhoods and renting them out.

Jason Calvillo recently moved to Palm Desert from Springfield, Mass., and was able to rent a two-bedroom fully furnished home with new carpet, plantation shutters and custom tile for $1,200 a month.

“I figured that would be about two-thirds as much compared to buying in the same neighborhood,” said Calvillo, who wanted to be near the Gerald R. Ford Elementary School.

Vacancies rise

The latest census data also showed the number of vacant homes in the valley — those that are not vacation properties or second homes — has climbed to 18,278 since the last census in 2000.

The valley's home vacancy numbers must be taken in context because the 2010 census is the first taken during a recession in half a century, said Dowell Myers, a University of Southern California professor of urban planning and demography at the School of Policy, Planning and Development, and author of a widely referenced book on Census methodology and data.

Esmael Adibi, economist with Chapman University who compiles The Desert Sun's quarterly economic index report, said it's understandable that vacancies typically increase during economic downturns.

“Because the kids are not leaving the home, and in fact some are coming back,” Adibi said.

“An uptick in home vacancies can be attributed to double-digit unemployment rates and foreclosures,” said Tom Wilson, Palm Springs assistant city manager.

“Those two things would be reasons for people leaving,” Wilson said.

Foreclosures account for many of the vacant homes, Realtors said. Economists said the rental market is likely to continue to grow because many people can't qualify for mortgages to buy now. Others don't want to own a house because they are uncertain about the security of their jobs or simply aren't ready for a long-term commitment.

Written by
MIKE PERRAULT
 
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2011-05-22 15:42:53
Valley home ownership holds firm


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