PRICES
At the end of February the median price of a detached home throughout the Coachella Valley was $617,000, which is a year-over-year gain of 19.5%. The median price for attached homes was $439,250, which is a 12 month gain of 29%. The cities of Rancho Mirage, Indian Wells and Indio have year-over-year increases for the average detached home above 30%.
Eight cities have price gains for attached home over 30%, with La Quinta having a year over year increase of 51.4%.
The high demand for attached homes is due to the lack of detached home supply in the lower price ranges.
SALES
Total sales in February averaged 852 units a month, which is 19% less than last February. While lower than last year, sales are still one hundred units higher than pre-pandemic levels.
Sales of detached home are down 17%, while those for attached homes are down 25% due to continued lack of supply. Compared sales by city, the largest declines are in the four major resort cities of La Quinta, Palm Desert, Palm Springs and Rancho Mirage. Some of this is due to the large price increases in these cities, which naturally reduces the size of overall buying pool.
Cities classified as working cities – Cathedral City, Desert Hot Springs and Indio – generally have sales comparable to year ago levels.
INVENTORY
Inventory continues to hover near record lows and on March 1st was at 607 units. This is disconcerting. The normal seasonal increase in inventory that usually occurs between September and March failed to materialize this year, just like it failed last year.
On March 1st the “months of sales” for the Valley was the same as the last month at slightly more than 2 weeks. A year ago, the ratio was one month. These historically low ratios continue to indicate very low supply and moderate to strong demand – two ingredients for much higher prices.
Even though some home prices have surged, this fundamental ratio strongly indicates that the upward price trend will continue.
DAYS IN MARKET
At the end of February, the median number of “days in the market” throughout the Valley was 29 days, which is two days more than last month. With inventory remaining low and sales staying high, demand continue to keep selling times near record lows.
Palm Springs has the lowest selling time for detached homes at just 21 days, followed by the city of Coachella at 22 days.
In the attached market, Cathedral City have average selling times of just 8 days, followed by Palm Springs at 15 days.
SUMMARY
So, what do all these statistics mean? In a nutshell: Inventory is historically low and prices continue to remain high, and in some communities, continue to rise.
When will this market end? No one knows. We can speculate. Supply and demand, higher mortgage rates, the stock market, and turbulence in the world are factors that can affect the real estate market. Sales can remain high for a period of time or stagnate.
As I’ve been saying for many months – If you’re considering selling your desert home, now is the ideal time. If you’re a buyer, have your funds in place to immediately make an offer when you find a great home.
I’m here to assist you with your real estate needs here in the desert. Feel free to contact me.
Best Regards,
Darlene