Palm Springs Real Estate Market Update - Q1 2023
The January 2023 real estate data is in at The Paul Kaplan Group, and it paints an interesting picture for the market ahead. With many key datapoints shifting, we will get into what it all could mean for the coming peak months of the desert season. As with all our market reports, the data and analysis below are representative of the entire desert resort area, stretching from Palm Springs to Indio. If you are interested in learning more about a specific city, community, or neighborhood, connect with your local Paul Kaplan Group/Bennion Deville Homes real estate professional. Visit PaulKaplanGroup.com to get started.
The year kicked off with a lethargic tone across the market. Closing activity was down considerably despite a high level of available inventory. However, pending sales spiked moth-over-month, indicating the sluggish number of sold homes could be a continuation of a holiday market hangover and not necessarily indicative of a greater trend. The number of homes for sale continues to grow month-over-month, but the sale pace remains on a slower course, which is quickly approaching two months on average to sell a home. In good news for sellers, the median price for a home realized another solid gain, but with a hint of caution as the listing discount is also deepening, hitting 4% for the month. With a smaller pool of closed sales, it is possible the median home price gain is more statistical illusion than solid reality, but it is encouraging for prospective sellers, nonetheless. As buyers contend with mixed signals from the economy and higher interest rates with little signs of them lowering any time soon, serious sellers will need to properly price their listings for sale and be aware of available financing incentives to attract buyers. Talk to your Paul Kaplan Group/Bennion Deville Homes real estate professional about your situation to figure out the best marketing strategy for your home.
There were 344 homes sold in the month of January, a 53.1% dive from the same month last year and a 16.7% decrease from December. This sales activity produced almost $580 million in sales volume, a 13% increase year-over-year, and an 84.8% jump month-over-month. The market welcomed 930 new listings in January, a slight 0.3% bump from January 2022 and a 63.2% surge over December 2022. For future closings, there were 679 homes that went into pending status, a 12.9% decrease year-over-year but a 60.9% increase month-over-month. The median sale price for a Coachella Valley home ended the month at $623,000, a 12.7% increase year-over-year and a 13.3% jump month-over-month. Similarly, the price per square foot came in at $433, an 8.5% bump on an annual basis and a 15.5% uptick over December. The average days on market, noted as the sale pace, clocked in at 55 days, a 44.7% increase (faster) from the same month last year, and a 12.2% increase over the prior month. The listing discount, which is calculated by dividing the sale price by the list price, was 96%, or a realized 4% discount off the list price, a 2% decrease annually and a 1% decrease when compared monthly. The month ended with 1,862 homes for sale, a 216.1% surge year-over-year and a 1.4% upward nudge month-over-month. Overall, there is a 5.4-month supply of homes to satisfy market demand, a 575% increase year-over-year (which had less than a month of inventory!) and a 22.7% increase month-over-month. With a balanced market considered at about 6 months of inventory, the January market conditions continued to reflect the overall shift in direction while buyers slow their approach. As our peak season marches on, we will monitor the impact rising inventory and changes to the greater economic picture have on desert home sales.