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Local residential real estate experts Market Watch LLC have just released their May 2023 Desert Housing Report. Some highlights:

MAY COACHELLA VALLEY HOME SALES RECOVERY CHART: This month, Market Watch introduced a new chart showing how current average Coachella Valley home sales compare to average home sales before the pandemic. The light blue area on the chart shows where home sales were below average, and the light green area shows where they were above average. The pre-pandemic average of home sales was calculated over the years 2016, 2017, 2018 and 2019. For example, at the height of the pandemic in January of 2021, home sales were 59.5% above average. Home sales then fell to 34.7% below average by January of this year. They have improved over the last few months and are now 22.6% below average. Market Watch predicts a return to normal home sales by the end of the year (red dotted line), based on the current trend of recovery, plus their belief that mortgage rates will return to the 5.5% range.

MAY COACHELLA VALLEY DETACHED HOME MEDIAN PRICE: The median price of a detached home in the Coachella Valley in May was $695,000 (down 0.7% from $700,000 in May 2022). Market Watch felt that this small decline in the detached home median price showed that the Coachella Valley residential, real estate market has continued to hold onto the home price gains of the last five months. Further, Market Watch felt that there are a few more months of seasonal home price strength, so they expected a slight upward pressure on detached home prices to continue for this period.

MAY COACHELLA VALLEY ATTACHED HOME MEDIAN PRICE: The median price of an attached home in the Coachella Valley in May was $485,000 (up $5,000 or 1% from $480,000 in April and only down 1.2% from the record high attached home median price of $491,056 reached in May 2022). Market Watch felt that this was further evidence that homeowner worry of large home price declines has so far been misplaced and that supply and demand continue to stay somewhat balanced.

TWELVE MONTH CHANGE IN THE PRICE OF THE AVERAGE SIZE HOME IN THE COACHELLA VALLEY BY CITY: In May, every Coachella Valley city other than Desert Hot Springs had a decrease year-over-year in the price of its average size detached home. The declines ranged from -2.2% in La Quinta to -14.7% in Indian Wells. Price changes year-over-year for average size attached homes ranged from an increase of 18.5% in Desert Hot Springs to a decrease of 10.1% in Indio. 

MAY COACHELLA VALLEY MONTHLY HOME SALES (THREE MONTH TRAILING AVERAGE):  The three-month average of home sales rose significantly in May to 769 total home sales per month (up 15.6% from 665 total home sales in April but still 22.6% below pre-pandemic average monthly home sales). Market Watch stated that some of this sales increase was seasonal but a lot or it was due to a general recovery in both the detached and attached home markets.

MAY COACHELLA VALLEY MONTHLY HOME SALES (TWELVE MONTH TRAILING AVERAGE): The 12-month average of home sales, which takes out seasonality from the home sale data, shows total home sales averaged 592 home sales per month in May. Market Watch noted that this is the 22nd consecutive monthly decline and that long term home sales are running about 26% below the pre-pandemic long term home sales average of 800 home sales per month. Market Watch predicts that the long-term home sales numbers should begin to rise in the next month or two.

MAY COACHELLA VALLEY HOME SALES BY CITY:  Home sales (three month average) decreased in every Coachella Valley city, other than Thousand Palms and Coachella. The largest decreases were in Desert Hot Springs (down 48.1% year-over year), followed by Bermuda Dunes (down 41.2% year-over-year) and Cathedral City (down 32.9% year-over-year). Of the larger Coachella Valley cities, in May La Quinta and Palm Desert had the smallest percentage sales declines of 18.2% and 19.6% respectively.

MAY COACHELLA VALLEY HOME SALES BY PRICE RANGE: Market Watch noted that sales of homes priced under $400,000 have been improving and are now approaching year-ago levels. Even home sales priced between $400,000 and $500,000, which has the most home sales except for million-dollar plus home sales, have been improving. The largest decline in sales appears to be in homes priced between $500,000 and $700,000. Sales of million-dollar plus homes averaged 167 home sales per month (down 28.3% from an average of 233 homes sales per month in May 2022). Market Watch pointed out that this is a huge improvement over a few months ago when million-dollar plus home sales were running 60% or more below year-ago levels.

MAY COACHELLA VALLEY TOTAL HOME SALE INVENTORY: On June 1st, Coachella Valley home sale inventory was 1,867 homes (up 58.4% from 1,179 homes on June 1st, 2022 but nine homes less than in April). Market Watch stated that the Coachella Valley home sale inventory has effectively remained unchanged for the last eight months. They felt that the primary reason inventory isn’t growing is because lower home sales have been evenly matched with a lower number of new listings. They also pointed out that Coachella Valley home sale inventory also has a seasonal pattern and if it continues, they expect the number of available homes for sale to begin to contract moving into summer.

MAY COACHELLA VALLEY REGIONAL MONTHS OF SALES RATIO: On June 1st, the Coachella Valley’s months of sales ratio was 3.2 months (0.1 month higher than on May 1st but 1.9 months more than on June 1st, 2022). Market Watch explained that this fundamental ratio, which measures supply versus demand, is slightly below the historic averages for this time of year. To them, this means that, even though home sales are down, there continues to be a balance between buyers and sellers, helping to stabilize home prices.

MAY COACHELLA VALLEY MONTHS OF SALES BY PRICE RANGE: The months of sales ratio is significantly higher than one year ago in every price range. Market Watch noted that except for the extreme high and low price ranges, the months of sales ratios are all close to the regional average of 3.2 months. They felt that this helped to explain why home prices are relatively stable throughout the entire range of home prices.

MAY COACHELLA VALLEY MONTHS OF SALES RATIOS BY CITY: The months of sales ratios were 3 months or less in Coachella, Cathedral City, Indio and Palm Desert. Market Watch stressed that the months of sales ratio was below 4 months in all of the Coachella Valley cities.

MAY COACHELLA VALLEY REGIONAL DAYS IN THE MARKET: The average selling time in the Coachella Valley is starting to decrease. At the end of May, the median number of days in the market in the Coachella Valley was 44 days (4 days less than at the end of April but still 24 days more than at the end of May 2022). Market Watch predicts that the days in the market will continue to gradually move lower and will not return to the pre-pandemic average of 65 days.

MAY DAYS IN THE MARKET FOR DETACHED & ATTACHED HOME BY CITY: For detached homes, in May Coachella continued to have the lowest median selling time in the Coachella Valley at 21 days (compared to 24 days in May 2022). This was followed by a detached home median selling time of 35 days in May in Desert Hot Springs (compared to 15 days in May 2022). The longest detached home median selling time in May in the Coachella Valley was 51 days in Palm Desert (compared to 21 days in May 2022). For attached homes, in May Cathedral City had the shortest median selling time in the Coachella Valley at 22 days (compared to 30 days in May 2022). This was followed by an attached home median selling time of 26 days in Palm Springs (compared to 11 days in May 2022). The longest attached home median selling time in May in the Coachella Valley was 85 days in Bermuda Dunes (compared to 28 days in May 2022).

PERCENTAGE OF HOMES SELLING IN THE COACHELLA VALLEY OVER LIST PRICE IN MAY: In May, 17% of the home sales in the Coachella Valley were above list price (compared to 58.3% in May 2022). Market Watch pointed out that the percentage of homes selling above list price in the Coachella Valley has stopped declining and has started to increase.

AVERAGE PRICE DISCOUNTS FROM LIST PRICE: For detached homes, in May every Coachella Valley city other than Coachella had an average selling discount for detached homes, ranging from -0.7% in Desert Hot Springs to -3.4% in Indian Wells. The city of Coachella had an average selling premium for detached homes of 0.2% in May. For attached homes, in May every Coachella Valley city had an average selling discount, ranging from -1.4% in Cathedral City to -6.4% in Bermuda Dunes.

The Briggs Group at Coldwell Banker Realty | Laurie Briggs – DRE# 01896117 | Tim Briggs – DRE# 01898254 | Coldwell Banker Realty DRE# 00616212