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Local real estate market experts, Market Watch LLC, have just released their October 2019 Desert Housing Report. Some of the highlights include:
The Coachella Valley median detached home price in October was $400,000 (up 3.4% year-over-year but down from the September median detached home price of $405,000).
In October, the Coachella valley median attached home price was $275,000 (up 3.8% year-over-year and also up from the September median attached home price of $271,000). Market Watch noted that this is the normal seasonal pattern here in the Coachella Valley (particularly for attached homes) and predicted that prices should increase for the next seven or eight months.
On a city by city basis, year-over-year median detached home prices rose in Cathedral City (+7.5%), Palm Springs (+7.1%), Indio (+4.6%) the City of Coachella (+3.5%), Desert Hot Springs (+2.7%), Palm Desert (+0.9%) and Rancho Mirage (+0.5%). Median detached home prices decreased year-over-year in La Quinta (-0.5%) and Indian Wells (-4.8%). Palm Springs is the only Coachella Valley city where the median detached home price is above the previous record high median detached home price (in 2006-2007). In fact, the current median detached home price in Palm Springs is 11.5% above the 2006-2007 median detached home price. Market Watch noted that this new high median detached home price is founded on sound wages and stable mortgages, unlike in 2006-2007. Median attached home prices rose year-over-year in Cathedral City (+13.3%), Indian Wells (+5.7%), Palm Springs (+4.0%), Palm Desert (+3.9%) and Rancho Mirage (+1.5%). Median attached home prices declined year-over-year in Indio (-7.5), La Quinta (-7.8%) and Desert Hot Springs (-34.1%).
Total Coachella Valley home sales (averaged over the last three months) were 755 units per month compared to 737 units per month one year ago. This is an increase in total home sales of 2.4%. Sales of detached homes averaged 524 units per month (up 9% from the 480 detached homes sold per month one year ago). Sales of attached homes averaged 230 units per month (down 10% from the 256 attached homes sold per month one year ago).
On a city by city basis, seven cities (Coachella, Desert Hot Springs, Indian Wells, Indio, La Quinta, Rancho Mirage and Thousand Palms) showed an increase in average three-month sales; two cities (Cathedral City and Palm Springs) showed a slight decrease in average three-month sales and two cities (Palm Desert and Bermuda Dunes) had the same number of average three-month sales as one year ago. The largest percentage increases were in the city of Coachella (with sales up 35%) and Indian Wells (with sales up 25%).
In looking at home sales by price bracket, sales declined in the two price brackets under $300,000 and increased in the two price brackets between $400,000 and $600,000. Market Watch called out the increase in sales of homes over $1 million (45 units per month versus 31 units per month one year ago).
On November 1st, inventory in the Coachella Valley for both detached and attached homes was 3,010 units. This is the lowest November 1st reading in more than 5 years. Market Watch noted that the low inventory of homes has been the primary factor behind rising home prices.
Market Watch noted that months of sales, which is the ratio of inventory divided by the current sales rate, is a direct measure of supply versus demand. A low months of sales number is generally good for sellers while a high months of sales number is generally good for buyers. The current months of sales ratio of 3.8 months is historically very low. The days in the market, which measures how long it's been taking to sell the average home, stood at 62 days (and has been stable at between 60 and 70 days for the last three years).
Months of sales by price range are calculated by taking the inventory of homes in each price bracket and dividing it by the sales rate in that price bracket. Market Watch noted that it is normal to have low months of sales ratios with lower priced homes and higher months of sales ratios with higher priced homes simply because it takes longer to sell higher priced homes than lower priced ones. Market Watch noted that the months of sales ratios in all price brackets were comparable to last year and were within normal ranges.
In looking at the current month of sales ratio for the major cities in the Coachella Valley compared to the same ratio one year ago, Market Watch noted that Indio and Coachella showed the lowest ratios at three months. Market Watch also commented that they were surprised to see the Palm Springs months of sales ratio stand at around three months given the significant increase in home prices there.
Lastly, the sale price discount from list was -1.9% (versus an average -2% discount one year ago). Market Watch looked at the sale price discount from list back to October 2014, and noted a consistent yearly improvement in this metric from -2.8% back in October 2014 to -1.9% today. This current ratio means the average home offered at $400,000 finally sold for $392,400.
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