As the weather cools down in the desert the real estate market continues to heat up!
While COVID-19 has had profound effects on the country in many ways, it has been a boon for the desert’s real estate market. In fact, home sales have increased dramatically — having reached all-time highs in the number of homes sold compared to previous years. The number of homes sold last month increased by +38.2% when compared to the same month a year ago. Buyers are active in all price ranges and good homes priced right are selling quickly and often getting multiple offers.
Home selling prices continue to increase, and low inventory, combined with continued strong buyer activity, has resulted in a +30.1% increase in the average selling price across the Palm Springs area when compared to the same month last year.
There were 1,995 homes available for sale last month, compared to the 2,787 homes that were available for sale in September 2019 … a significant (-28.4%) decrease in available housing over that period! Low inventory continues to be an issue here in the Palm Springs area, and while there has been a slight uptick in the number of homes available for sale over last month, we are not seeing the usual seasonal increase in new listings that are typical for this time of year.
The high demand and low inventory have been major factors in home prices increasing, with the median sale price for detached homes (single-family) up (+25.9%) over the same month last year, while the median price for attached homes (condos) is up (+12.5%).
Let’s look at the three key market indicators, Average Sold Price, Number of Homes for Sale, and Number of Days on Market, for a good snapshot of the Palm Springs area real estate market and, its overall health.
- Average Home Sale Prices. The average home sale price last month in the Palm Springs area was $596,000 an Increase of (+30.1%) over the same month last year.
- Number of Days on Market. Days on market have decreased (-15.9%) … homes are now selling in an average of 74 days.
- The Number of Homes for Sale. There were 1,995 homes for sale last month, a (-28.4%) decline over September of last year. Inventory remains near record lows, making it challenging for buyers who are looking for that perfect desert home.
Interest rates are still at an all-time low and will continue to drive new purchases and refinance activity. 30-year fixed-rate mortgages are staying steady at 2.858% and 15-year fixed loans are at 2.354%. The 5/1 ARM rate stands at 3.070% and 30-year jumbo loans are at 3.480%.
City Standouts! What’s Up and Who’s Down?
The strength in our market is clear when looking at the numbers for each of the major cities in the area. The number of homes sold in September 2020 vs. September 2019 are up in all cities EXCEPT: Desert Hot Springs (-19.3%) and Coachella (-26.7%). Rancho Mirage, Palm Desert, Indian Wells and La Quinta saw the most dramatic increases in number of homes sold, with (+82.3%), (+71.5%), (+79.2%) and (+72%) increases respectively.
When looking at the Average Selling Prices, Palm Springs stood out with an incredible (+43.2%) increase over last September. Some of this increase can be attributed to the mix of homes being sold as the $1M+ price range is doing very well. Every city in the Coachella Valley experienced an increase in average selling price except for Indian Wells (-18.8%) and Bermuda Dunes (-9.2%).
The Number of Days on Market decreased noticeably for all cities in the Coachella Valley, with Coachella being notable for homes selling in an average of only 20 days!
City Watch - La Quinta
Number of Homes for Sale = 538 (-14.9%)
Number of Homes Sold = 203 (+72%)
Average List Price = $977,092 (+12%)
Average Sale Price = $783,257 (+36.9%)
Average Days on Market = 77 (-28.7%)