A “general corrective turn” in home prices across the nation is being felt in the Coachella Valley, according to the latest report from Greater Palm Springs Realtors.
Driving the news: In Palm Springs, the median price of a detached home fell by roughly $11,000 last month but was still selling for north of $1.3 million. That’s an increase of almost 24% from last August’s average of $1.1 million.
Bigger picture: Across the valley, the median price of a detached home fell nearly $30,000 in August — from $710,000 in July to $682,000. That number is still up 17.4% over August of last year. What’s surprising is the volume.
- The number of properties sold has fallen dramatically, with the three-month average of sales last month at 674 units per month — 31% lower than a year ago. Housing data stretching back to 2017 shows that sales in August are normally around 875 units.
- The biggest drop in sales were in La Quinta and Palm Desert, where sales were down 42% and 34% respectively.
- “These are the lowest numbers since the housing crash 15 years ago,” the report states.
Zoom in: All but Coachella and Thousand Palms had a lower number of units sold in August compared to last year, with prices about as expected.
- The price of an average-sized detached home in August was highest in Indian Wells (at $1.8 million), and lowest in Desert Hot Springs ($413,000).
Zoom out: Unlike many months during the pandemic, the decline is sales is not necessarily due to lack of inventory. As of Sept. 1, the valley had roughly 750 more units of housing available for purchase compared to the same date last year.
- Inventory is expected to continue growing, possibly reaching 2,500 units by February, according to the report.
Waiting game: Homes are remaining on the market slightly longer, indicating a seller’s market is waning. The median number of days on market in the valley last month was 28 days compared to 25 days last year. Desert Hot Springs had the lowest average selling time of 19 days.
- According to the report’s authors: “We believe we’ve seen the lows in average selling times and expect this metric to rapidly increase back to 50 or 60 days, which is normal for the region.”
Paying premiums: Many homes are still selling over list price, just not as many as this time last year. The report shows 36% of sellers in the valley received more for their home than they asked for in August. Last year that number was 51%.
What to watch for: Since we still don’t know if the drop in prices is temporary or a true price correction, experts say keep an eye on the next two or three months to see if median prices continue to drop.