An Update on the Coachella Valley Real Estate Market
It is a foregone conclusion that the desert real estate market is shifting, as we have tracked over the summer months and into the fall. The third quarter data gives us greater insight into what’s happening across the market heading into our prime season. Due to the unprecedented market conditions, we will also look at the September numbers and analyze the data to identify how trends are tracking over a shorter period. The numbers and analysis below cover the primary desert resort cities region and may differ from a given city or community. If you are interested in learning more about the state of the market in a specific neighborhood or city, please reach out to your local Bennion Deville Homes REALTOR®. We appreciate the opportunity to unlock possibilities for you.
In our second quarter recap we noted the beginning of a market shift, calling out the rise in inventory and decline in activity as two key factors. Three months later, those trends are still dominant in the market, with inventory climbing dramatically year-over-year (nearly double!) and on a quarter-by-quarter basis. Sales activity declined as well, which falls closer to our traditional “seasonal” sales pattern with slower summer months and a buildup of activity in the fall. However, the fallout from these dominant trends leaked into the supporting metrics as well. The listing discount returned, meaning that on average homes were selling for less than list price. The sale pace also slowed dramatically, indicating homes are sitting on the market longer, which can put downward pressure on prices and push up the listing discount. The direction of these two areas certainly impacted the median sale price for a home, which remained a healthy clip above last year’s number but dropped on a quarterly basis. We are viewing these developments as a necessary measure to help the market balance and remain sustainable beyond the extreme conditions of the pandemic-era real estate market. A cooling but still warm market should be welcome news to both buyers and sellers as more options at more attractive price points will encourage sales. Additionally, inventory is still below average, so homes that are well-priced have a great chance to fetch a strong return.
The third quarter saw 1,603 homes change hands, a 33% drop year-over-year and a 38.2% decline from the second quarter of this year. The sales volume of those sales produced over $1.5 billion, a 3% increase from last year but a 29.6% drop from the prior quarter. More than 2,500 homes (2,577) hit the market last quarter, a 12% decline year-over-year and a 26.6% plummet quarter-over-quarter. Over the last quarter, 1,735 homes went into pending status, a 26.2% dip from the same period last year and a 26.8% drop from the prior quarter of this year. The median sale price of a Coachella Valley home ended at $591,700, a 17.2% boost over the same quarter last year and a slight 4.1% reduction from the prior quarter. Similarly, the average price per square foot finished at $395, a 17.9% increase year-over-year and an 8.5% decrease quarter-over-quarter. The sale pace, noted as average days on market, clocked in at 38 days, a 15% increase (slower) year-over-year and a 42% jump quarter-over-quarter. The listing discount, noted as the difference between the sold price versus list price, ended at 98.3% (or a 1.7% discount), a 2.3% dip from the same time a year ago and a 3% decline from the previous quarter. Inventory levels finished at a 2.9-month supply to feed demand, a 177.4% increase year-over-year and a 120.5% jump quarter-over-quarter. A balanced market is considered at around 6 months of inventory, indicating that sellers still hold some additional leverage at the bargaining table with buyers.
Turning our attention to the September numbers, the desert returned to the trends that we noticed most of the summer. August had a reduction in new listings and a slightly elevated median sale price. September’s figures invert that trend, with more listings hitting the market and the median price slumping monthly, while still tracking well above the same period last year. Increasing inventory isn’t much of a surprise given we are entering a traditional period of greater market activity, and this has been the case for the several months, too. As more properties hit the market, we expect to see the sale price regress but maintain a healthy level given inventory remains low overall. The other interesting piece to look at is the continuing slowdown in the sale pace as well as the deepening listing discount. Although both are still faster and higher, respectively, than our typical market conditions, the consistent direction of both metrics paired with growing inventory and a more moderate sale price indicates the market is well into a shift and returning to more stable conditions. As mentioned above, these numbers signify good news for anyone considering actions in the market, regardless of buying or selling. Homebuyers can be picky, and sellers can still capitalize on healthy price gains.
September had 487 property sales, a 34% dive from the same time last year and a 14.4% decline month-over-month. The sales volume of those sales finished above $486 million, a 3.9% dip year-over-year and a 4.6% drop compared to the prior month. There were 846 new listings that hit the market, a 13.9% drop year-over-year but a 2.1% increase over August. The market saw 654 homes go into pending status, a 14.8% decline year-over-year but a 20.9% increase month-over-month. The median sale price of a home ended at $575,000, an 11.7% jump from last September but a 6.5% decline from the previous month. Likewise, the price per square foot came in at $385, a 12.2% surge from last September but a 6.8% drop from August of this year. The sale pace, noted as the average days on market, ended at 44 days, a 29.4% increase (slower) from last year and an 18.9% slower pace compared to August. The listing discount, noted as sale price versus list price, ended the month at 98% (a 2% discount off the list price), a 2% drop from the same month last year and the same as August. The month ended with 1,621 homes for sale, a 90% increase year-over-year and a 10.3% jump from last month. Overall, there is a 3.3-month supply of homes on the market, a 175% increase on an annual basis and a 26.9% monthly jump. A balanced market is considered at 6 months of supply, so although the annual and monthly increases are drastic, the market still slightly leans toward sellers.
If you are considering the sale or purchase of a Coachella Valley property, we would be honored to have the opportunity to assist you. Please reach out to a Bennion Deville Homes real estate professional for a free market analysis of your home or to discuss the lifestyle you are looking for in your next abode. We will unlock possibilities for you.
- Bennion & Deville
- Bennion and Deville
- Bennion Deville Homes
- Bob Deville and Bob Bennion
- Cathedral City
- Coachella Valley
- coachella valley real estate market analysis
- Indian Wells
- La Quinta
- Palm Desert
- Palm Springs
- Rancho Mirage
- Real Estate
- Real Estate Agent
- Real Estate Market Analysis
- Real Estate Market Data