Local real estate market experts, Market Watch LLC, have released their May 2019 Desert Housing Report analyzing the state of the Coachella Valley's housing market. Some of the highlights:
The Coachella Valley median detached home price in May was $430,000 (an increase of 4.3% year-over-year). This is the highest median detached home price since the recovery began eight years ago.
The Coachella Valley median attached home price in May was $297,000 (an increase of 6% year-over-year). This is also the highest median attached home price since the recovery began. Market Watch’s analysts pointed out that over the last 8 to 9 years the median price for attached homes has been highest in May. If this pattern holds, they say look for weaker median attached homes prices from now until September.
The median detached home price increased in seven cities year-over-year and decreased in Palm Desert (-3.4% ) and in Rancho Mirage (-4.4%). Market Watch’s analysts noted that price gains of detached homes are slowing somewhat. They also noted that median detached home price in Palm Springs reached $672,000 in May (12% above Palm Springs 2006 all-time high median detached home price). In the attached home market, Market Watch pointed out that year-over-year median attached home prices increased by double digits in La Quinta (+13.2%), Indian Wells (+10.5%) and Palm Desert (+10.3%).
The 3-month average of total homes sales was 995 units a month (6.5% below a year ago). Market Watch noted that historically, sales almost always peak in the month of May so they claim that sales should now begin to slow down somewhat heading into the summer month.
Ten of the eleven Valley cities had lower three-month sales compared to a year ago. Of the five major cities, La Quinta had the largest percentage decline in three-month sales (-11.6%) followed by Palm Desert (-7%) and Rancho Mirage (-7%). Of the smaller cities, Bermuda Dunes had the largest percentage decline (-26%). Even with the large price increases in Palm Springs, sales continued to remain strong at 201 units a month.
In looking at sales by price bracket, Market Watch noted that the primary drop in sales were for homes priced under $400,000, due to the dwindling supply of homes in this price range as home prices increase. The largest decline occurred in the $200,000 to $300,000 price bracket, where sales fell from 263 units a month to 224 year-over-year. In the $300,000 to $400,000 price bracket sales fell from 244 units a month to 223 year-over-year. Sales of homes priced over $900,000, including those over $1 million, were roughly unchanged.
Inventory on June 1st was 3,433 units, approximately 100 more than last year at this time. It was Market Watch’s analysts’s opinion that with the rapid rise in sales over the last three months, inventory levels should begin to decrease.
On June 1st , the months of sales ratio, which is inventory divided by the average 12-month sales, was 4.3 months (7/10 of a month higher than a year ago). Market Watch noted that a 4.3 months of sales ratio is a very low, positive ratio and shows that the Coachella Valley market is still somewhat a seller’s market. Market Watch analysts pointed out that the median value of days on the market was 65 days (the same level that the median days on the market has been at for the last three years). In their opinion, this also shows that the Coachella Valley market is a seller’s market.
The months of sales ratios for homes priced under $800,000 are slightly higher than they were a year ago. For homes priced between $900,000 and $1 million, the months of ratio declined from 10.8 months to 7.7. For homes priced over $1 million, the ratio is down slightly from 13.9 months to 12.5 months.
Seven cities, Indio, Palm Desert, Bermuda Dunes, Desert Hot Springs, La Quinta, Rancho Mirage and Indian Wells, have slightly higher month of supply ratios when compared to a year ago. The cities of Coachella, Cathedral City, and Thousand Palms all have months of supply ratios measurably lower than a year ago.
The latest Sale Price Discount from List is -2.2% (up 0.1% year-over-year). This ratio means the average home listed for $400,000 sold for $391,200 (a $8,800 price discount).