Palm Springs leads valley in home sales, but pace is down from a year ago

Palm Springs had the most home sales of any Coachella valley city over the three months ending in September, though the pace was slower than a year earlier, according to the latest Desert Housing Report from the Greater Palm Springs Realtors.

The city averaged 97 sales a month, down from 117 a year ago. Palm Desert followed with 93 and Indio with 71. Dollar sales in Palm Springs averaged $73 million a month, second behind La Quinta at $77 million. Palm Springs was at about $95 million a year ago, according to the report’s chart.

The report estimates the price of an average-size home in each city by multiplying the median price per square foot by the typical home size. Using that method, a 2,175-square-foot detached home in Palm Springs was priced at $1,102,246, down 1.4% from $1,118,046 a year ago and 22.3% below the city’s 2022 high of $1,417,969. A 1,250-square-foot attached home was priced at $425,614, down 0.7% from $428,463 a year ago and 11.3% below its 2022 high of $480,000.

Palm Springs had 599 homes for sale as of Oct. 1, down from 615 a year ago. Only Palm Desert, at 612, had more. The city’s “months of sales” ratio, which divides inventory by average monthly sales, was 6.2 months, compared with 5.2 months a year ago.

The report says a regional ratio under six months indicates a balanced market. The valley as a whole stood at 4.5 months, compared with 4.6 last year. Palm Desert and Bermuda Dunes, both at 6.6 months, had the highest ratios in the valley.

Homes in Palm Springs sold faster than a year ago. The median home spent 55 days on the market, down from 61, and slightly below the valley median of 57 days. Coachella had the shortest time at 31 days, and Bermuda Dunes the longest at 91.

Palm Springs detached homes sold at an average discount of 4.0% from list price, compared with 3.8% a year ago. The report notes that cities with higher-priced homes generally sell at larger discounts. Indian Wells had the largest at 6.5%, and Coachella the smallest at 1.1%.

Across the valley , the median price of a detached home was $624,000 at the end of September, a change of -0.3% from last year. The median attached home price was $425,000, up 1.2%. The report says detached homes have generally held the price gains made during the pandemic.

Valley sales averaged 483 units a month over the three-month period, down 11.0% from 543 a year ago. The report notes that three-month figures are seasonal and should be compared only with the same period in earlier years. The 12-month average, which removes seasonality, was 619 units a month, compared with 612 a year ago. Dollar sales across the valley averaged $383 million a month, down 10.1% from last year.

Valley inventory stood at 2,765 homes, down 34 units, or 1.2%, from a year ago. The share of valley homes that sold above list price was 11.0%, compared with 11.4% last year. Detached homes in the valley sold at an average discount of 2.8%, compared with 2.7% a year ago, and attached homes at 3.8%.

The report describes the market as becoming supply heavy but says that should not cause a problem for home prices unless it begins to lengthen average selling times. It adds that the housing market continues to need lower mortgage rates. It notes that inflation remains low but that the Federal Reserve has stopped lowering short-term rates until it can determine the effect of the administration’s new economic policies.

The report excludes the 3% to 5% of sales that close after the end of the month. Those sales are included in the next month’s update.

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