As we move towards the end of the high season in the Coachella Valley, we seem to be entering a “new normal” in the real estate market, with the inventory at a plateau, sales down compared to this time last year, and a slight dip in average selling prices. Interest rates continue to dampen sales, as does general uncertainty about the financial markets. Let's take a look at the numbers from last month.
Year-over-Year Comparison: February 2022 vs. February 2023
- Inventory: There were 597 homes for sale in February 2022, while February 2023 saw a significant increase to 1,805 listings – a (+202.3%) rise. This increase in inventory provides more options for potential buyers, making it a more favorable market for them.
- Homes Sold: In February 2022, 755 homes were sold; in February 2023, only 515 homes were sold, marking a (-31.8%) decrease. Higher mortgage interest rates and buyer uncertainty about the direction of the market are likely factors in the drop in the number of homes sold.
- Average Sold Price: The average sold price in February 2022 was $850,000; in February 2023, it decreased to $813,000 – a (-4.4%) drop. This decline may indicate a shift towards a buyer's market, with sellers possibly lowering their prices to attract more interest.
- Average Days on Market: Homes in February 2022 stayed on the market for an average of 34 days, while in February 2023, the average increased to 64 days – a (+88.2%) increase. This longer time on the market may result from the increased inventory and more discerning buyers, as they have more options to choose from.
Month-over-Month Comparison: January 2023 vs. February 2023
- Inventory: Homes for sale in January 2023 totaled 1,898, while in February 2023, the number decreased slightly to 1,805 – a (-4.9%) decline. This modest decrease in inventory may not have a significant impact on the overall market dynamics.
- Homes Sold: In January 2023, 360 homes were sold, while in February 2023, the number increased to 515 – a (+43.1%) rise. This considerable increase in sales may indicate growing buyer interest or more favorable market conditions.
- Average Sold Price: The average sold price in January 2023 was $877,000; in February 2023, it decreased to $813,000 – a (-7.3%) decline. This decrease suggests that buyers may have gained more negotiating power in the market, leading to lower sale prices.
In Reality, We Have Two Different Markets!
While the overall trends support moving into a more neutral market, we, in fact, have two very different markets right now. Homes in top condition, with recent updates, and in good locations are still commanding at or over asking prices, and many are getting multiple offers. Homes that are dated, lack desirable amenities, or are in less desirable locations are not moving as quickly. Many of these sellers have to reduce their selling prices to generate interest from buyers.
Interest rates. The average 30-year fixed-rate mortgage currently sits at 6.980%, while today’s 15-year fixed mortgage rate is 6.140%, and the jumbo 30-year fixed rate is 7.020%.
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 February 2023 vs. February 2022 has decreased in all cities, with the biggest sales drops in Cathedral City (-59.7%), Indian Wells (-41.4%), and La Quinta (-36.4%).
Regarding Average Selling Prices, Coachella stood out with the strongest increase in average selling prices (+12%) over last February’s sales. Most of the cities in the Coachella Valley experienced a decrease in average sold price except for Rancho Mirage (+6.5%) and Palm Desert (+0.5%).
The Number of Days on the Market increased for all cities in the Coachella Valley.
City Watch - Rancho Mirage
Number of Homes for Sale = 188 (+208.2%)
Number of Homes Sold = 53 (-27.4%)
Average List Price = $1,358,000 (-26.2%)
Average Sale Price = $1,169,000 (+6.5%)
Average Days on Market = 59 (+37.2%)
If you're considering putting your home on the market, let us help you get it SOLD! Now, more than ever, marketing matters! Our world-class marketing plan, with online ads, paid YouTube ads, and social media exposure is critical in this shifting market. Call now for a free seller consultation, and let us help you decide if now is the right time to sell your home.
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