Our local housing market experts, Market Watch LLC, have just released their June 2023 Desert Housing Report. Some highlights:
COACHELLA VALLEY HOME SALES RECOVERY: This seasonally adjusted graphic compares current Coachella Valley home sales with average Coachella Valley home sales over the years of 2016, 2017, 2018 and 2019 (i.e., before the pandemic). At the height of the pandemic in January of 2021, Coachella Valley home sales were 59.5% above average. Home sales then fell to 34.7% below average by January of this year. After improving for four months, home sales stopped edging back toward normal and have continued at roughly 22.1% below average. Market Watch predicted normal home sales by the end of the year (as shown by the red dotted line), based on their belief that the inflation rate will fall to 3% and mortgage rates will return to 5.5%. If this doesn’t happen, then they predicted that Coachella Valley home sales could remain below normal for a longer period of time.
COACHELLA VALLEY JUNE DETACHED HOME MEDIAN PRICE: The median price of a detached home in the Coachella Valley at the end of June was $690,000 (down 1.4% from $700,000 in June 2022). Market Watch noted that this is a very small decrease and the market continues to hold the price gains of the last five months. However, since the Coachella Valley’s period of seasonal price strength is coming to an end, they expect a slight downward pressure on detached home prices moving into summer.
COACHELLA VALLEY JUNE ATTACHED HOME MEDIAN PRICE: The median price of an attached home in the Coachella Valley at the end of June was $475,000 (down 2% or $10,000 from $485,000 in May and down 3.1% or $15,000 from $490,000 in June 2022). Market Watch noted that this is the first decline in the attached home median price in four months. Market Watch felt that this shows that homeowner worry of large price declines has so far been misplaced. Further, they expect supply and demand to remain in balance, with the caveat that the usual seasonal pressures should push attached home median prices slightly lower over the next few months.
JUNE TWELVE MONTH CHANGE IN THE PRICE OF THE AVERAGE SIZE HOME BY CITY: Every Coachella Valley city, other than Desert Hot Springs, had a year-over-year decrease in the price of their average size detached home, ranging from -4.1% for the 2,550 sq ft average size detached home in La Quinta to -12.1% for the 3,450 sq ft average size detached home in Indian Wells. Four Coachella Valley cities had year-over-year increases in the price of their average size attached homes, ranging from an increase of 0.7% for the 1,775 sq ft average size attached home in Rancho Mirage to an increase of 16.2% for the 750 sq ft average size attached home in Desert Hot Springs. The other five Coachella valley cities surveyed had decreases in the price of their average size attached homes ranging from a decrease of -3.2% for the 1,750 sq ft average size attached home in La Quinta to a decrease of -15.4% for the 1,450 sq ft average size attached home in Bermuda Dunes.
COACHELLA VALLEY JUNE MONTHLY AVERAGE HOME SALES – THREE-MONTH TRAILING AVERAGE: The three-month average of home sales in the Coachella Valley in June was 772 homes (up slightly from 769 home sales in May and down 16.4% from 923 home sales in June 2022). Market Watch predicted that home sales should contract moving into summer due to the usual seasonal price pressures in the Coachella Valley.
COACHELLA VALLEY JUNE MONTHLY AVERAGE HOME SALES – TWELVE-MONTH TRAILING AVERAGE: The 12-month average of home sales in the Coachella Valley in June, which removes seasonality from the home sales data, was 585 homes sales per month (down 34.5% from 893 home sales in June 2022). Market Watch pointed out that this was the 23rd consecutive monthly decline in this long-term average of home sales. They also predicted that these long term average sales figures should begin to rise in a month or two (because long term home sales averages follow the direction of short-term sales average, and short-term average homes have been increasing since February).
COACHELLA VALLEY JUNE HOME SALES BY CITY: In every Coachella Valley city, other than La Quinta and Coachella, three-month average home sales in June were lower year-over-year. The largest percentage declines in home sales year-over-year were in Desert Hot Springs (down 32.3% year-over-year) and Indio (down 28.3% year-over-year). Market Watch did point out that year-over-year home sales were improving in every city.
COACHELLA VALLEY JUNE HOME SALES BY PRICE RANGE: Market Watch felt that sales of homes priced under $500K in June were close to year-ago levels. They pointed out that largest home sales declines continued to be in homes priced between $500k and $700k. June sales of million-dollar plus homes (averaging 165 home sales per month) were only down 17.9% from 201 homes sales in June 2022. Market Watch noted that this was a vast improvement from a few months ago when million-dollar plus home sales were running 60% or more, below year ago levels.
COACHELLA VALLEY JULY 1st HOME INVENTORY: On July 1st, Coachella Valley home inventory was 1,741 homes (down 6.7% from 1,867 homes on June 1st and up 13.7% from 1,531 homes on July 1st, 2022). Market Watch pointed out that inventory has effectively remained unchanged, with a very gradual decline, for the last eight months. They felt that the primary reason that inventory hasn’t increased was the continued low number of new listings. Since Coachella Valley home inventory also has a seasonal pattern, Market Watch expects inventory to contract moving into summer.
COACHELLA VALLEY JULY 1st OVERALL REGIONAL MONTHS OF SALES RATIO: On July 1st, the Coachella Valley’s months of sales ratio was 3.0 months (down 0.2 months from June 1st but up 1.3 months from 1.7 months on July 1st, 2022). Market Watch noted that this fundamental ratio, which measures supply versus demand, was slightly below the historic averages for this time of year. They also noted that the months of sales ratio points to the continuing balance between buyers and sellers, which helps stabilize home prices.
COACHELLA VALLEY JULY 1st MONTHS OF SALES RATIOS BY PRICE RANGE: In every price range, the months of sales ratio in the Coachella Valley in June was considerably higher than it was one year ago. However, Market Watch noted that except for the million dollar plus price range and the price ranges below $400,000, the months of sale ratios in most of the middle price ranges brackets were close to the regional average months of sales ratio of 3.0 months.
COACHELLA VALLEY JULY 1st MONTHS OF SALES RATIOS BY CITY: The months of sales ratios on July 1st were under three months in Coachella, Palm Desert, Indio and Cathedral City. The months of sales ratios on July 1st were equal to or below 3.5 months in the other Coachella Valley cities surveyed.
COACHELLA VALLEY JUNE REGIONAL DAYS IN THE MARKET: Market Watch noted that the median selling time in the Coachella Valley as a whole is starting to decrease. At the end of June, the median number of days in the market in the Coachella Valley was 40 days (four days less than in May but 19 days more than in June 2022). Because of dwindling inventory, Market Watch expects the days in the market will continue to gradually decrease.
COACHELLA VALLEY JUNE DAYS IN THE MARKET FOR DETACHED AND ATTACHED HOMES BY CITY: In the Coachella Valley in June, Coachella continued to have the lowest median selling time for detached homes at 27 days, followed by Desert Hot Springs at 33 days, then Palm Desert at 38 days. In the case of attached homes, Indio, Indian Wells and Desert Hot Springs had the shortest median selling time at 29 days each.
COACHELLA VALLEY JUNE PERCENTAGE OF HOMES SELLING ABOVE LIST PRICE: In June, 17.2% of Coachella Valley home sales were sold above list price (compared to 55% in June 2022). With tightening inventory, Market Watch expects the number of home sales at or above list price will continue to increase.
COACHELLA VALLEY JUNE AVERAGE PRICE DISCOUNTS BY CITY: In June, detached home sales in each Coachella Valley city surveyed were on average selling at a discounted price from list, ranging from -0.1% in Coachella to -3.6% in Indian Wells. In June, attached home sales in each Coachella Valley city surveyed were on average selling at a discounted price from list, ranging from -1.6% in Cathedral City to -5.4% in Bermuda Dunes.
The Briggs Group at Coldwell Banker Realty | Laurie Briggs – DRE# 01896117 | Tim Briggs – DRE# 01898254 | Coldwell Banker Realty DRE# 00616212