Local real estate market experts, Market Watch LLC, have just released their August 2023 Desert Housing Report. Some of the highlights:
COACHELLA VALLEY AUGUST SALES RECOVERY: After improving for four months, Coachella Valley home sales in August stopped moving toward normal for this time of year (based on Coachella Valley home sales in 2016, 2017, 2018 and 2019) and are currently 24.4% below the norm. Market Watch admitted that their projection for normal home sales by the end of the year is no longer realistic. They explained that it was based on their belief that inflation would fall to 3% and mortgage rates would fall to 5.5% by the end of the year. Market Watch noted that recent actions by the FED made this unlikely.
COACHELLA VALLEY AUGUST DETACHED HOME MEDIAN PRICE: The median price of a detached home in the Coachella Valley at the end of August was $660,404 (down 0.8% from $665,500 in July and down 3.2% from $682,000 in August 2022). Market Watch felt that this decrease in the detached home median price was primarily a seasonal decline, since the summer months in the Coachella Valley almost always bring some price weakness. Market Watch did not expect this to translate into anything more than a seasonal issue, because while home sale inventory is slowly contracting, home sales are also low, so supply and demand remain in balance.
COACHELLA VALLEY AUGUST ATTACHED HOME MEDIAN PRICE: The median price of an attached home in the Coachella Valley at the end of August was $439,000 (down 2.4% from $450,000 in July and down 6.1% from $467,500 in August 2022). Market Watch noted that if the normal seasonal pattern were to continue, attached home median price weakness should continue for another month or two. Lastly, they believed this attached home median price weakness was seasonal, since supply and demand remain in balance.
COACHELLA VALLEY AUGUST TWELVE MONTH CHANGE IN THE PRICE OF THE AVERAGE SIZE HOME BY CITY: In August, in every Coachella Valley city other than Desert Hot Springs home prices decreased year-over-year price for each city’s average size detached home. The price decreases ranged from 3.2% for the average size 3,175 sq ft detached home in Rancho Mirage to 11.6% for the average size 3,450 sq ft home in Indian Wells. Desert Hot Springs experienced a year-over-year increase in August of 0.2% in the price of the average size 1,600 sq ft detached home in that city. For attached homes in the Coachella Valley in August, four cities (Indian Wells, Desert Hot Springs, La Quinta and Rancho Mirage) saw year-over-year increases in the price of the average size home in those cities ranging from a year-over-year increase of 1.4% in the price of the average size 1,775 sq ft attached home in Rancho Mirage to an increase of 13% in the price of the 1,950 sq ft average size attached home in Indian Wells. Year-over-year attached home price decreases in the other Coachella Valley cities in August ranged from a decrease of 0.1% in the price of the average size 1,050 sq ft attached home in Indio to a decrease of 11.3% in the price of the average size 1,450 sq ft attached home in Bermuda Dunes.
COACHELLA VALLEY AUGUST MONTHLY HOME SALES - THREE MONTH TRAILING AVERAGE: The three-month average of home sales declined year-over-year in August to 623 home sales (51 home sales or 7.6% less than the average of 674 home sales in August 2022). Market Watch pointed out that the home sales decrease is occurring proportionally in both the detached and attached market and mirrors the Coachella Valley’s seasonal home price decline. Again, August Coachella Valley average monthly home sales were approximately 24.4% below the 2016-2019 historic norm.
COACHELLA VALLEY AUGUST MONTHLY HOME SALES - TWELVE MONTH TRAILING AVERAGE: In August, the Coachella Valley’s 12-month average of home sales (which takes out seasonality from the data) averaged 579 units a month (down 31.3% from an average of 843 home sales per month in August 2022). Market Watch felt that the long-term average of home sales was starting to flatten out and the worst may be over. They did state that monthly average home sales won’t fully recover until mortgage rates fall from 7.5% to around 5%.
COACHELLA VALLEY AUGUST HOME SALES BY CITY: In August, year-over-year home sales decreased in every Coachella Valley city other that Cathedral City and Rancho Mirage (where monthly home sales increased year-over-year by 10.6% in Cathedral City and 11.3% in Rancho Mirage). The largest percentage decreases year-over-year in August were in Palm Springs (down 18.5% year-over-year) and Indio (down 11.1% year-over-year).
COACHELLA VALLEY AUGUST HOME SALES BY PRICE RANGE: Market Watch felt that home sales in all price ranges were finally comparable to August 2022 levels. In fact, the two years looked like mirror images of each other. They did note one exception in sales of homes priced over $800,000, where home sales averaged about 20% less than in August 2022.
COACHELLA VALLEY SEPTEMBER 1ST TOTAL HOME SALE INVENTORY: On September 1st, the Coachella Valley home sale inventory was 1,601 homes (down 28 homes from August 1st and up 8 homes from September 1st, 2022). Market Watch noted that some of the recent slow decline in inventory was seasonal but the primary reason for the low inventory level was the low number of new listings. They expected the normal seasonal increase in inventory to begin next month.
COACHELLA VALLEY SEPTEMBER 1st REGIONAL MONTHS OF SALES RATIO: On September 1st, the Coachella Valley’s months of sales ratio was 2.8 months (up from 1.9 months on September 1st, 2022). Market Watch noted that the months of sales ratio measures supply and demand and they felt that 2.8 months represented a balanced housing market. In turn, they felt this points to continuing stable home prices.
COACHELLA VALLEY SEPTEMBER 1st MONTHS OF SALES RATIO BY PRICE RANGE: Market Watch noted that the September 1st months of sale ratios were higher than the September 1st, 2022 months of sales ratios in every price range. Market Watch felt that the fact that the year-over-year increase was approximately equal across all price ranges indicated that the Coachella Valley market was showing no distortion in supply and demand in any price bracket.
COACHELLA VALLEY SEPTEMBER 1ST MONTHS OF SALES BY CITY: Market Watch commented that other than in Thousand Palms what was notable is how equal the increases were in each city compared to year ago levels. They felt that this showed that supply and demand were balanced in all of the Coachella Valley cities.
COACHELLA VALLEY AUGUST REGIONAL DAYS IN THE MARKET: At the end of August, the median number of days in the market in the Coachella Valley was 38 days (up from 28 days in August 2022). Because of low home sale inventory, Market Watch expected the regional days in the market to continue to gradually move lower and be equal to year ago levels within a month or two.
COACHELLA VALLEY AUGUST DAYS IN THE MARKET BY CITY: The city of Coachella continued to have the lowest median selling time for detached homes at 22 days (down from 26 in August 2022), followed by Cathedral City at 31 days (up from 23 days in August 2022) and then Desert Hot Springs at 32 days (up from 19 days in August 2022). In the case of attached homes, in August Desert Hot Springs had the shortest average selling time at 29 days (up from 22 in August 2022), followed by La Quinta at 30 days (down from 35 days in August 2022) and Palm Springs at 33 days (up from 20 days in August 2022).
COACHELLA VALLEY AUGUST PERCENTAGE OF HOMES SELLING OVER LIST PRICE: In the Coachella Valley in August, 17.5% of homes sold above list price (compared to 38% in August 2022). Market Watch expected the percentage of homes selling over list to remain at current levels as inventory grows moving into fall and winter.
COACHELLA VALLEY AUGUST PRICE DISCOUNTS BY CITY: In every Coachella Valley city in August, detached homes were selling at an average discount, ranging from -0.3% in Cathedral City to -2.9% in Rancho Mirage and Indian Wells. In August, average discounts for attached homes ranged from -1.4% in Indio to -5.8% in Bermuda Dunes.
The Briggs Group / Coldwell Banker Realty | Laurie Briggs DRE 01896117 | Tim Briggs DRE 01898254 | Coldwell Banker Realty DRE 00616212