Jeff Stahl
COACHELLA VALLEY, Calif. (KESQ) – A News Channel 3 I-Team Investigation is getting answers on something viewers have been asking us for months.
Yes, Fewer Canadians will be renting condos and homes in the Coachella Valley this upcoming winter season. Also, fewer Canadians are buying homes here this year. But is it due to Canadian-U.S. politics, or just good business? The answer might surprise you.
Cold-weather snowbirds flock to the desert each wintertime for sunshine and warmth. It’s a major driver of our winter tourism-based economy.
But with Tariffs and new entry requirements for Canadians, we’ll see fewer Canadian plates this winter. Local realtors say they’ve already noticed a definite drop in calls of interest from our neighbors to the north.
Dave Burke manages dozens of seasonal rentals and said, “I have talked to other realtors and other people and try to get a feel for what’s going on with them, and everyone’s kind of seeing the same thing.” The “same thing” is fewer inquiries and a handful of available properties yet to be rented. He says people typically book them a year in advance.
“I still have 3 or 4 that are still open for the season,” said Portia Richmond Director of Operations at LHC Management in Palm Springs adding, “That’s very rare. Very rare.” Richmond says her inventory is normally booked by March, a year in advance. Richmond said, “Canadians like to plan!”
“With the rentals, it’s one set of concerns. And I think with people that are buying, that’s a different set of concerns,” said Stephenie Zinn of Desert Lifestyles Properties, a local realty and property management company also based in Palm Springs. She says the Canadian drop-off is hitting all facets of the market, both rentals and sales.
ButZinn says it’s not just the politics of the new Trump administration and tariffs, but also high interest rates, rising insurance costs, and U.S. Canadian Dollar exchange rates– all impacting sales in good ways and bad.
She showed us an analysis of Riverside County tax records, obtained through a local title company, to point out some stark comparisons on a Canadian sales slump. “18 Canadian buyers in the previous 12 months, then in just the past 12 months there’s only been 3,” said Zinn adding, “That’s a pretty big difference.”
Zinn’s analysis shows fewer Canadians are buying Coachella Valley properties this past year, compared to the previous 12 months. A caveat– the downturn mirrors our overall sales, also down.
A local realtor and appraiser, Nick Miller, said this past year has beena good time to sell for many Canadians with local properties to sell. “Absolutely, we had so many people from Canada purchase properties here from that 2012 to 2015 window when our home prices were extremely depressed because of the great recession, and the Canadian Dollar was strong almost on parity with the US Dollar,” Miller said.
Showing us a Palm Desert property he’s listed for sale, Miller says a surge of Canadians have cashed in their equity this year on those vacation homes many purchased when our home prices were at post-recession rock-bottoms.A
A local property appraiser for 20 years he says a typical $150,000 local property purchased in 2013 may have doubled or tripled in value since then– to more than half a million U.S. dollars. Selling this past 11 months would translate to a huge financial windfall for a Canadian looking to leave. And then add an exchange rate bonus because the Canadian dollar– once nearly equal to our dollar– is now weaker worth just 71 cents to a U-S dollar.
“So they’re getting an additional 30 percent back,” Miller said adding, “So maybe that $150,000 investment could be as much as $750,000 thousand Dollars in some cases.”
Might they still come south when the snow flies up north? Richmond said, “I believe it’s going to be a different kind of year.” But Richmond also says she expects her remaining inventory to be rented, likely by snow state Americans, although Canadians are always welcome back.
Burke is also optimistic all his listings will be filled. “Now they’re starting to see some good deals, pricing, airfares, even home rentals. People are adjusting those prices a little bit,” Burke said adding, “A lot of times when that weather does change, they reconsider it.”
Zinn says despite a current pullout, she was surprised by the significant number of Canadians who still own properties in our desert cities. “There are still 921 Canadian condo owners and 429 single-family residence owners in the city of Palm Desert,” Zinn said.
So one thing is certain: our U.S.-Canadian ties may be strained, but can ease again– bringing those snowbirds back.
Lower interest rates may be sparking a new interest in sales. To get a deal, Miller says any buyer should be aggressive. Identify four or five properties you like, and write aggressive offers to see who’s motivated to sell.
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