Home sales in the Palm Springs area have edged up slightly over the last three months following seven months of gradually declining sales. The sales declines were not due to softening buyer demand but simply to the extreme lack of inventory we've experienced over the last eighteen months.
As a result, selling prices continue to edge upwards, although not as rapidly as during the first half of last year. Home prices quickly rose through May of last year before dropping a bit through July. We've seen a slight gradual increase in prices since then.
We are seeing buyers who were expecting home prices to drop, and sitting on the sidelines, as a result, show interest in getting back in the market before interest rates go up and prices rise even further.
Inventory rose slightly this past week +8.8%, but the overall market is still at near an all-time low. The new norm is multiple offers, with the list price being the starting price and final selling prices 5% - 7% above asking.
The number of homes available for sale was down -60.4% compared to last December and down 82% compared to three years ago. There were 1,557 homes for sale in December 2020 and only 616 last December.
Many buyers now feel a sense of urgency to buy as interest rates and selling prices increase, and that's resulted in a +14.6% increase in the number of homes sold and a +16.9% increase in pended homes from the previous month.
When we look at what's happening in the market month to month, we find that the number of homes for sale is down -15.6% in December compared to November. Why are home sales down? One simple fact: there are not enough homes available for sale to meet buyer demand.
The number of homes sold this past month rose +14.6% compared to November, and the average selling price in December is up +0.1% to $739,000, compared to $731,000 in November.
The rapid price increases we saw last year had slowed down a bit mid-year but came back during the holidays, and that trend seems to be carrying over into the new year. The average sale price for December was up +11% over the same month last year.
Let's look at the key market indicators that show how our market is performing compared to this time last year; Average Sold Price, Number of Days on Market, and Number of Homes for Sale.
- Average Home Sale Prices. Last month, The average home sale price last month in the Palm Springs area was $739,613 an Increase of +15.3% over the same month last year..
- Number of Days on Market. Days on market have decreased -38.7%, homes are selling on average of 38 days.
- The Number of Homes for Sale. There were 616 homes for sale last month, a -60.4% decline over October of last year. Inventory is still at an all-time low, if trends continue we'll see fewer homes on the market over the coming months.
Interest rates are still very low and will continue to drive new purchases and refinance activity. Conforming 30-year fixed-rate mortgages are at 3.625%, while the FHA fixed-rate are at 3.375%, VA loans are at 3.375%, and jumbo 30-year fixed is at 3.250%.
City Standouts! What's Up and Who's Down?
You can get a better view of the trends in our market when you look at the numbers for each major city in the area.
The number of homes sold in December 2021 vs. December 2020 has decreased in all cities except Bermuda Dunes +62.5%, Indio +1.2%, and Coachella +7.7%. The biggest percentage drop in sale was in Indian Wells, down -55.1% followed by La Quinta, down -35%.
When looking at the Average Selling Price, Rancho Mirage stood out with a substantial +48.2% increase over last December, followed by Desert Hot Springs, with a +36.8% in average selling price. Every city in the Coachella Valley experienced an increase in average sale price last month over the same time in 2020. Indian Wells had the highest average selling price of $1,727, 364.
Homes continue to sell quickly, and The number of Days on Market was down for all cities in the Coachella Valley except for Coachella, up +38.5%.
City Watch - Rancho Mirage
Number of Homes for Sale = 67 (-66.8%)
Number of Homes Sold = 81 (-32.2%)
Average List Price = $975,000 (+50.2%)
Average Sale Price = $1,080,911 (+48.2%)
Average Days on Market = 35 (-47%)
If you're considering putting your home on the market, let us help you get it SOLD! We see multiple offers for properly priced homes, and with fewer homes on the market, this could be the best time to get your home sold.
If you'd like a detailed market report for a specific city, email us and let us know which city reports you'd like to receive.
Give us a call at (760) 625-7229, or visit www.thehamiltonregroup.com, for an easy-to-use home search, and for information on how we can help you with all your important real estate needs.
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