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Our local real estate market experts, Market Watch LLC, have just released their October COVID-19 Desert Housing Report. This report uses shorter term metrics (primarily 28 day moving averages) to examine the rapidly changing market conditions due to the Coronavirus pandemic. Some highlights:
For comparison purposes, Market Watch examined average daily closed and pending/active under contract home sales data in Los Angeles County. Because average escrow times in LA County are between 30 to 35 days, by moving average daily pending/active under contract sales forward by 35 days, Market Watch is able to predict closed home sales. Average daily pending/active under contract home sales stood at 200 sales per day at the end of October (compared to 151 one year ago). Market Watch commented that home sales throughout LA County have been stable at a high level now for 3 1/2 months and that average daily pending/active under contract home sales indicate that closed sales will stay at or near this level for at least another 2 months.
Market Watch noted that Orange County’s average daily closed and pending/active under contract home sales showed almost an identical recovery pattern to Los Angeles County. Both average daily closed home sales (at 102 sales per day at the end of October compared to 70 sales per day one year ago) and pending/active under contract homes sales (98 sales per day at the end of October compared to 70 one year ago) were running roughly 40% ahead of year ago levels. Market Watch did state that this graphic seems to indicate that home sales may be slowing a little in Orange County.
Turning to the Coachella Valley, with escrow times for single family residences averaging 20 days Market Watch predicts daily average closed home sales by shifting average daily pending/active under contract home sales forward 20 days. Average daily pending/active under contract home sales have been stable at current high levels for 3 1/2 months (standing at 23.4 home sales per day at the end of October up 31% from the 17.9 home sales per day one year ago). Market Watch stated that the average daily pending/active under contract home sales show a continuation of home sales at these high levels for at least another month. However, they also stated that because a second COVID infection cycle appears to be forming as we head into the winter months, they expect home sales to begin to slow a little.
Market Watch commented that average daily pending/active under contract home sales for condominiums are also flattening out at a high level. Average daily pending/active under contract home sales at the end of October averaged 10.5 condos per day (up 72% from 6.1 condos per day one year ago). Market Watch commented that this indicates that active daily closed condo sales (averaging 11.3 condos per day at the end of October compared to 6.7 condos per day one year ago) will continue to stay at current levels for at least the next three weeks.
In terms of average weekly pending total home sales by City, Market Watch singled out Indian Wells (with average weekly pending sales up 200% from one year ago), La Quinta (with average weekly pending sales up 73.4% and Palm Springs (with average weekly pending sales up 65.5% from one year ago).
Average price per square foot for single-family residences in the Coachella Valley was $267 per sq ft (up 8.5% year-over-year). Average price per square foot for condos in the Coachella Valley was $231 (up 9.4% year-over-year).
Market Watch commented that year-over- year gains in average price per square foot have slowed slightly, with double digit increases in the average price per square foot for single family residences only happening in La Quinta and Palm Springs (both up 13.5% year-over-year). In the case of condos, there were double digit increases year-over-year in the average per square foot price in Indio (up 17.4%), Rancho Mirage (14.8%), Cathedral City (up 14.7%), Palm Springs (up 13.8%) and Indian Wells (up 11.6%).
Total Coachella Valley housing inventory hit a historic low at 2,022 homes at the end of October, compared to an inventory of 3,000 homes on October 31st one year ago and 3,019 homes on March 19th, which was the start of the California stay at home order. Market Watch pointed out that the normal seasonal pattern in the Coachella Valley of increasing housing inventory from October through March is not occurring, in part because of the low number of new listings replacing sold homes.
Year-over-year average daily new listings in the Coachella Valley dropped from 29 homes per day one year ago to 14 homes per day at the end of October. Even though the average number of new cancelled and expired listings has dropped year-over-year from 14 listings per day to 7 listings per day at the end of October, this decrease in both daily new listings and cancelled and expired listings has kept the housing inventory unusually low. In addition, Market Watch noted that there is a traditional seasonal drop in daily new listings that happens between Thanksgiving and the third week of January every year (so our housing inventory level must likely won’t improve until early next year).
The average number of days in the market for single family residences in the Coachella Valley in October was 59 days (compared to 80 days one year ago). Days in the market for condominiums in the Coachella Valley in October was 67 days (compared to73 days one year ago).
Last, but not least, the average sales price discount from list price was 1.0% for single family residence at the end of October, which Market Watch noted is the smallest discount in the last ten years. The average sales price discount from list price was 2.1% for condos at the end of October.
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