(Please click on the image above to view our short video highlight reel)
Local real estate experts, Market Watch LLC, have just released their March 2018 Coachella Valley Desert Housing Report. Some highlights:
The Coachella Valley’s median detached home price in March was $392,000 (a gain of 7% from March 2017’s median detached home price of $366,285); the highest it’s been since the summer of 2007.
The Coachella Valley’s median attached home price was $269,000 in March (an increase of 8% year over year). Market Watch noted a strong seasonal pattern to attached home prices, with price improvement usually starting in September and continuing through May. With this pattern, Market Watch predicted that the median attached home price could reach $275,000 over the next month or so.
Cathedral City and Desert Hot Springs lead the pack in year-over-year increases in median detached home prices (with increases of 17% for Cathedral City and 12.1% for Desert Hot Springs). Market Watch believes that this indicated that many local households are finally recovering from the financial crisis and are beginning to convert from renting to owning. Palm Springs, with a median detached home price of $646,750, is now 7.8% above its previous 2006 all-time high of $600,000. Even though six cities (Desert Hot Springs, Palm Desert, Coachella, Rancho Mirage, La Quinta and Indian Wells) registered median detached home prices more than 20% off their 2006 high median detached home prices, Market Watch indicated that they believe the other cities in the Coachella Valley are in the process of rapidly catching up and could also approach their all-time highs relatively soon.
The twelve-month average of total home sales in March was 834 units a month (compared to 770 units in March 2017). Of these total home sales, there were 537 detached home sales and 297 attached home sales per month (a sales mix of 64% detached home sales and 36% attached home sales). Market Watch felt that this increase in average sales is the factor that has been driving inventory lower over the last 12 months and predicted that total Coachella Valley home sales should continue to average about 834 units a month.
In looking at homes sales by city, four cities (Palm Springs, La Quinta, Indio and Thousand Palms) had slightly lower sales than last year. Cathedral City and Desert Hot Springs had the largest year over year increase in sales (with sales in Cathedral City increasing to 66 units in March vs. 58 in March 2017 and sales in Desert Hot Springs increasing to 48 units in March from 34 in March 2017). Palm Desert had the largest monthly sales of the eleven Coachella Valley cities at 182 units.
A breakdown of home sales by price range show higher sales year-over-year in all price brackets over $300,000. Sales in the two price brackets below $300,000 decreased, primarily due to a low inventory of homes in these price brackets. The percent sales increase tends to get larger the higher the price bracket, with sales of homes priced between $600,000 and $700,000 up 8%, sales of homes priced between $700,000 and $900,000 up 25%. Even sales of homes over $1,000,000 increased by 7%.
With regards to Coachella Valley housing inventory, Market Watch noted that for the second consecutive year the April 1st number was about 1,000 units less than the prior year. They also noted that the increase in inventory that occurred between September and April this year was much smaller than in previous years.
With lower inventory and higher sales, the months of supply ratio on April 1st stood at 4.5 months, the lowest ratio since April 1, 2013. Market Watch predicted that if the typical seasonal pattern holds, the months of supply ratio could decline to under 3 months into late summer and early autumn. They felt that this in turn would provide strong, technical support for home prices during the normally weaker summer months and lay the foundation for good price gains through all of 2018.
The months of supply ratio declined in all price brackets except for the $800,000 to $900,000 price bracket. The decline was largest for homes priced over $900,000 and for homes priced between $600,000 and $800,000.
The months of supply ratio also declined in every city except Coachella and Thousand Palms. Market Watch singled out Cathedral City and Palm Desert for strong inventory improvement. On April 1st, the months of supply ratio for Cathedral City was 2.7 months (down from 4.7 months at this time last year) while Palm Desert’s months of supply ratio decreased from 6.4 months last April 1st to 4.5 months this April 1st. Bermuda Dunes, Rancho Mirage and Indian Wells showed the largest year over year improvement in months of supply.
Market Watch LLC produces the Desert Housing Report for Coachella Valley real estate agents through the sponsorship and cooperation of the Palm Springs Regional Association of Realtors® and the California Desert Association of Realtors®.