Palm Springs Real Estate Update

In February 2024, Palm Springs home prices were up 14.9% compared to last year, selling for a median price of $850K. On average, homes in Palm Springs sell after 75 days on the market compared to 70 days last year. There were 137 homes sold in February this year, up from 102 last year.

Palm Springs Migration & Relocation Trends
In Dec ’23 – Feb ’24, 20% of Palm Springs homebuyers searched to move out of Palm Springs, while 80% looked to stay within the metropolitan area.
Where are people moving to Palm Springs from?
Across the nation, 6% of homebuyers searched to move into Palm Springs from outside metros.
San Francisco homebuyers searched to move into Palm Springs more than any other metro followed by New York and Seattle.
Where are people from Palm Springs moving to?
80% of Palm Springs homebuyers searched to stay within the Palm Springs metropolitan area.
San Diego was the most popular destination among Palm Springs homebuyers followed by Las Vegas and Bakersfield.

If you’re looking to buy a home in the Coachella Valley, things may be starting to turn in your favor. Nonetheless, typical spring price increases could be coming, meaning you may want to wait a few months to actually make a deal.

The latest report compiled by two local organizations for real estate professionals stated that rising inventory and relatively low numbers of sales are “beginning to slowly favor buyers.”

While inventory and home sale activity both remain well below normal, overall inventory — 2,309 units as of Feb. 1 — reached its highest level since 2020. That’s still about 1,000 units short of what’s been normal historically.

After months of declines, the number of home sales in January also modestly edged up closer to their normal pace. As a result, the median price of a detached home dropped to $660,000, down 1.8% from a year ago. The report notes that home prices typically rise in the Coachella Valley in January.

The median price of an attached home, meanwhile, did rise to $475,000, up 9.2% from January 2023. The report, which is compiled by Greater Palm Springs Realtors and the California Desert Association of Realtors, states that attached home sales are particularly impacted by seasonal variation and prices should be expected to increase for the next three to four months.

But for both types of homes, pricing trends vary throughout the valley. At the extreme ends of the spectrum were average detached home prices in Indian Wells and Bermuda Dunes, which were up 9% and down 11% respectively. Attached home prices were also up between 1.8% and 16.6% in Palm Springs, Rancho Mirage, Indian Wells and Indio, but down between 1.4% and 7.3% in other valley cities.

The report also contained some other good news for buyers: In January, the percentage of Coachella Valley homes selling over list price declined a little to 14%.

The average discount off list price for detached homes ranged from 1.4% in Coachella to 4.8% in Bermuda Dunes. Discounts for attached homes ranged from 1.1% in Cathedral City to 5.35% in Bermuda Dunes. The average amount of time a home is on the market, meanwhile, remained steady at 40 days.

While gains in home sales remain low relative to those in inventory, the report suggests sales could now be making their way back to normal levels, which they have not seen since mid-2022.

The report states that 510 homes were sold in January, an increase from 436 in January 2023.

Palm Springs-area home sales volume below normal, but rising
That January sale number also meant that home sales are now running 28.6% below their normal pace, a modest improvement in that figure after months of slowing sales.

“With lower inflation and mortgage rates we hope to see sales finally return to normal later this year,” the report states.

It notes that the 12-month moving average of valley home sales increased slightly from December to 618. The 12-month moving average has been relatively stable for several months after it experienced a near-steady decline from about 1,200 homes per month in July 2021 to around 600 in summer 2023.

The report states that the two organizations see the latest increase as a sign that the “worst is over” when it comes to the recently anemic home sales numbers. However, it also said they believe sales will fully return to their normal pace only when mortgage rates come down to 6% or lower.

As of Monday, interest rates being offered in the Palm Springs area were hovering around 7% for a 30-year fixed mortgage and 6% for a 15-year fixed mortgage, according to lending sites. Homes are also averaging about 40 days on the market, the same as last year. However, the report says recent declines in inflation offer hope that mortgage rates will soon decline.

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