Lake Havasu City is seeing an all-time low in both houses on the market and available rental properties as the coronavirus pandemic seems to have helped produce a strong seller’s market this summer.
Nicolle Stuhlberg, President of the Lake Havasu Association of Realtors, said the housing market took a slight dip this spring consistent with concerns over the pandemic. But demand has more than bounced back over the summer. Stuhlberg said that from March 1 to mid-September the number of active listings is down 28% compared to the same time in 2019, but the number of homes sold has increased by 7% and the value of sales is up 26%.
Stuhlberg said last Friday that the housing inventory in the city is at an all-time low. A search of the association’s database of available homes for sale on Tuesday showed 216 active listings on Tuesday. But low inventory appears to have less to do with the number of people selling than an explosion in demand.
“We have seen a tremendous amount of activity from buyers,” Stuhlberg said. “We have 23% of new listings hitting the market that are under contract within one day and 56% are under contract within ten days of being listed.”
Eric Gedalje, owner of the Janecek Gedalje Group, said the number of homes hitting the market seems to be fairly typical but competition to buy is more fierce than he has ever seen it – especially sustained at this level for so long.
“This isn’t just a month or two of covid chaos,” he said. “This has kind of maintained as the new norm for more than three months now.”
The summer has also been good for developers and home builders in Havasu, with lots of people also electing to build new homes. According building reports from Lake Havasu City, about 80 permits to build new single family residences were issued from the beginning of June to the end of August.
Gedalje said he believes the limited inventory of existing houses has likely helped boost demand for new construction.
“When you have such limited supply, from the buyers’ perspective the expectations need to be broadened a little bit,” Gedalje said. “A lot of the requirements in Havasu, let’s face it, are bigger garages. With our low inventory and lower selections buyers are resorting to building to accommodate all of their recreational needs.”
That has certainly been the case up in The Foothills, where sales of the Villas have skyrocketed in the last 90 days.
Gedalje, who is in charge of selling the Villas, said the first phase included a total of 30 lots and 21 homes were sold in the first 785 days since the development hit the market in January 2018. That works out to roughly one lot sold every 37 days. But in the last 90 days the first phase of the Villas sold the remaining 30% of its inventory and phase two opened up at an even faster pace.
Gedalje said phase two of the Villas has an estimated 55 lots, 10 of which were sold in the first two weeks after they became available in September.
In all, a total of 19 properties have been sold in the Villas between the first and second phase in the last 90 days, according to Gedalje. That is a rate of one sale in less than 5 days, which is roughly eight times faster than the development was selling prior to the pandemic.
“Literally, at this rate, we could potentially be sold out by first quarter of next year – 10 lots in 14 days is just unbelievable and the marketing is just starting to get going,” Gedalje said of phase two. “So we couldn’t be more pleased with the progress. When you add everything up we are going to need to have phase three available to the public to keep the momentum going. So we have already started planning and we are hoping to break ground on mass grading of phase three in the first quarter of the year.”
Competition for rentals
The rental market in Lake Havasu City has mirrored that of home sales throughout the summer with lots of competition for a dwindling supply.
Stuhlberg said numbers for long term rentals are more difficult to track than property sales, but available rental properties seem to be at an all-time low and monthly rental rates are steadily increasing.
“It is not uncommon to see 10+ rental applications submitted within hours of any property that becomes available,” Stuhlberg said.