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Our local real estate market experts, Market Watch LLC, have just released their December 2020 Desert Housing Report. Some highlights:
The December Report starts with a look at the percentage of Coachella Valley homes sold over the last 90 days above list price. Since a home will only sell above list price if there are multiple bidders, Market Watch felt that this is an indirect measure of how many bidding wars are breaking out. Historically one out of every 10 homes (or 10%) sold in the Coachella Valley since 2013 sold above list price. Most recently, one out of every 4.5 homes (or 22.3%) sold in the Coachella Valley over the last 90 days sold above list price. Market Watch explained that this shows the bidding pressure that has been accelerating Coachella valley home price increases due to the lack of supply.
The Coachella Valley detached home median price in December was $520,000 (up 22.4% year-over-year and the highest Coachella Valley detached home median price since 2003).
The Coachella Valley attached home median price in December was $329,000 (up 17.9% year-over-year and the highest Coachella valley attached home median price since 2007). Market Watch noted that attached home prices have been surging for five months now, after lagging an earlier surge in detached home median prices. Market Watch felt that attached homes are now supplying homes in the lower price ranges due to the lack of detached homes in the lower price ranges.
All nine of the Coachella Valley cities surveyed experienced year-over-year detached home median price increases. Six of these cities (La Quinta, Palm Springs, Desert Hot Springs, Cathedral City, Indian Wells and Palm Desert) experienced year-over-year detached home median price increases of over 15%. At the head of the pack, detached median home prices increased year-over-year 27.5% in La Quinta and 22.9% in Palm Springs. Five of the Coachella valley cities surveyed experienced double-digit increases in attached home median prices year-over-year (ranging from an increase of 20.6% in Indian Wells to an increase of 13.6% in Palm Desert). Market Watch’s commentary also noted that in December, the detached home median price in Palm Springs, Cathedral City and Indio now surpassed the previous all-time high detached home median prices reached during the 2006 housing bubble.
Historically, December falls in a seasonal period when Coachella Valley home sales slow. However, this year Coachella Valley December monthly total home sales were 1,119 homes (an increase of 57.2% year-over-year). December monthly detached home sales were 759 homes (an increase of 51.2% year-over-year) and December monthly attached homes sales were 360 homes (an increase of 71.4% year-over-year).
The Coachella Valley cities experiencing the greatest surge in home sales in December were La Quinta, with average monthly total home sales of 188 homes (up 77.4% year-over-year), Palm Springs, with average monthly total homes sales of 223 homes (up 60.4% year-over-year) and Palm Desert, with average monthly total home sales of 236 homes in December (up 58.4% year-over-year).
Market Watch pointed out significant home sales increases in all price ranges over $300,000 in December. In particular, they noted that the average monthly sales of homes priced over one million dollars was 130 homes per month (up 170.8% year-over-year).
Coachella Valley housing inventory on January 1st was 1,507 homes (down 49.7% year-over-year). Market Watch noted that historically housing inventory usually begins to rise in September. However, this year, housing inventory has continued to decline as we moved toward the end of the year. Market Watch felt that most of this housing inventory decline might be due to homeowners being reluctant to list their homes and expose themselves to a large number of people during the pandemic.
On January 1st, the months of sales ratio (which measures how many months it would take to sell off the current housing inventory at the current sales rate) was 1.7 months (compared to 3.7 months one year ago). Market Watch noted that this is the lowest months of sales ratio in the history of the Coachella Valley. The median value of days in the market on January 1st was 38 days (compared to 50 days one year ago).
Market Watch noted the decline in the months of sales ratio in all price ranges year-over-year, with the months of sales ratio hovering around two months in all price ranges below one million dollars. Market Watch also noted that the months of sales ratio of 3.8 months for homes priced over one million dollars is the lowest ratio in this price range in Coachella Valley history.
On January 1st, the months of sales ratio in every one of the Coachella Valley’s eleven cities surveyed was roughly 3 months or less. And seven of these cities (Coachella, Palm Springs, Indio, Cathedral City, Desert Hot Springs, La Quinta and Palm Desert) had months of sales ratios under two months.
Lastly, in December the median value for sale price discount from list was -0.59% (implying that an average house listed at $500,000 would sell for $497,050).
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