Local real estate market experts, Market Watch LLC, are out with their October 2022 Desert Housing Report. Some highlights:
COACHELLA VALLEY OCTOBER DETACHED HOME MEDIAN PRICE: The detached home median price in the Coachella Valley in October was $675,000 (up $5,000 or 0.75% from $670,000 in September and up $75,000 or 12.5% from a median price of $600,000 in October 2021). Market Watch noted that the data shows that home price correction that many have feared has been relatively mild in the Coachella Valley to date. In fact, they pointed out that some of the price correction over the last couple of months is just the historical seasonal correction at play. However, they also stated that it is hard to ignore the effect of higher interest rates on both buyers and seller.
COACHELLA VALLEY OCTOBER ATTACHED HOME MEDIAN PRICE: The attached home median price in the Coachella Valley in October was $456,250 (down 1.9% from $465,000 in September but up 23.3% from $370,000 in October 2021). Market Watch noted that past attached home median price data shows a historical seasonal price correction of between 10% to 15% at this time of year. They do expect a larger than normal price correction for attached homes this year, with the attached home median price bottoming out around $435,000. They noted that this would be in line with the historical 4.5% price growth curve for attached homes in the Coachella Valley.
OCTOBER TWELVE MONTH CHANGE IN PRICE OF THE AVERAGE SIZE HOME BY CITY: October year-over-year changes in the median price of the average size detached home by city in the Coachella Valley ranged from 28.9% for the average size 3,450 sq ft detached home in Indian Wells to 3.2% for the average size 2,500 sq ft detached home in Bermuda Dunes. October year-over-year changes in the median price of the average size attached home ranged from 36.8% for the average size 750 sq ft attached home in Desert Hot Springs to 14.6% for the average size 1,775 sq ft attached home in Rancho Mirage. Market Watch pointed out that median price increases were slowing in every Coachella Valley city, particularly for detached homes.
OCTOBER MONTHLY COACHELLA VALLEY HOME SALES (THREE MONTH MOVING AVERAGE): October monthly total home sales (3-month average) averaged 534 homes (down 33.8% from average monthly total home sales of 806 homes in October 2021 and down 8.1% from average monthly total home sales of 581 homes in September). Market Watch pointed out that October’s average monthly home sales were also down 28.4% from the pre-pandemic October average of 746 home sales. Market Watch expressed their opinion that with the Federal Reserve continuing to tighten interest rates, it does not appear these home sales figures will turn around anytime soon.
OCTOBER MONTHLY COACHELLA VALLEY HOME SALES (TWELVE MONTH MOVING AVERAGE): The 12-month average of home sales removes the seasonality from home sales data and showed average monthly total home sales of 793 in October (down 24.5% from 1,050 home sales in October 2021 and down 3.7% from an average of 823 home sales in September). Market Watch pointed out that because the shorter 3 month average monthly home sales have reached a new low, the longer 12 month average monthly home sales will also continue to decline to below the pre-pandemic averages.
OCTOBER COACHELLA VALLEY HOME SALES BY CITY: Market Watch pointed out that home sales decreased in every Coachella Valley city other than Coachella. Home sales decreased by 48.7% year-over-year in Cathedral City, 43.4% in La Quinta and 35.3% in Palm Springs.
OCTOBER COACHELLA VALLEY HOME SALES BY PRICE RANGE: While home sales decreased in every price range, the largest declines were in sales of homes priced under $400,000. Sales of homes priced between $200,000 and $300,000 declined by 65.3% year-over-year and sales of home priced between $300,000 and $400,000 declined by 49.3% year-over-year. Sales of homes priced between $800,000 and $900,000 were almost unchanged year-over year. Sales of homes priced over $1 million declined by 22.5% year-over-year.
COACHELLA VALLEY HOME INVENTORY: On November 1st, Coachella Valley home inventory was 2,048 homes (up 241 homes or 13.3% from 1,807 homes on October 1st and up 1,133 homes or 123.8% from 915 homes on November 1st, 2021). Market Watch noted that this increase in home inventory was opposite to almost every other California region, where inventory generally declined slightly last month. Further, they noted that some of this increase in inventory was seasonal and that if the pattern continues, inventory would probably reach 2,500 units by February (compared to pre pandemic inventory norms of over 3,000 homes).
COACHELLA VALLEY REGIONAL MONTHS OF SALES RATIO: On November 1st, the Coachella Valley’s months of sales ratio was 2.6 months. While higher than September’s 2.2 months of sales, this ratio is still considerably below the 4.0 months that is historically normal for this time of year. Market Watch felt that even though the home inventory has been increasing and home sales have been decreasing, the changes have not been enough to bring the months of sales ratio back to normal levels. Market Watch went on to state that the months of sales ratio measures supply versus demand and a ratio of 2.6 still implies that the balance of supply and demand somewhat favors the seller. They felt that this has helped limit price corrections.
COACHELLA VALLEY MONTHS OF SALES RATIO BY PRICE RANGE: Months of sales ratios in every price range far exceed year ago levels. Market Watch noted both the evenness of the inventory recovery and that the inventory recovery is occurring across all price ranges.
COACHELLA VALLEY MONTHS OF SALES RATIO BY CITY: In October, Indian Wells and Bermuda Dunes had the lowest months of sales ratios at 2.2 and 2.3 months respectively. The highest months of sales ratios were in Desert Hot Springs at 2.9 months and Thousand Palms at 3.0 months. Other than these cities, the months of sales rations across the Coachella Valley were between 2.5 and 2.7 months,
COACHELLA VALLEY REGIONAL DAYS IN THE MARKET: Average home selling times in the Coachella Valley increased in October to 35 days (compared to 25 days one year ago and 32 days in September). Market Watch felt that this metric will rapidly increase back to 50 or 60 days (the historically normal days in the market in the Coachella Valley).COACHELLA VALLEY DAYS IN THE MARKET BY CITY: In October, Indian Wells had the shortest median selling time for detached homes at 25 days (compared to 26 days one year ago), followed by Rancho Mirage at 29 days (compared to 26 days one year ago). In October, Desert Hot Springs had the shortest median selling time for attached home at 23 days (compared to 11 days one year ago), followed by Cathedral City at 30 days (compared to 34 days one year ago).
PERCENTAGE OF COACHELLA VALLEY HOMES SELLING ABOVE LIST PRICE: While the percentage of homes in the Coachella Valley selling above list price is rapidly declining, at the end of October, 21.6% of home sales occurred above list price (compared to 46.2% one year ago and 27.7% in September). Market Watch noted that the percentage of homes selling over list price continued to retreat in October to the historic norm of around 10%.
AVERAGE SALES PRICE DISCOUNTS FROM LIST BY CITY: Bermuda Dunes was the only Coachella Valley city with a selling premium (0.5%) for detached homes in October. Bermuda Dunes was also the only Coachella Valley city with a selling premium (0.6%) for attached homes in October. All other Coachella Valley cities had average sale price discounts of between 0.1% to 2.9% for both detached and attached homes.
The Briggs Group at COMPASS | Laurie Briggs – CalDRE# 01896117 | Tim Briggs – CalDRE# 01898254 | COMPASS – CalDRE# 01991628