Coachella Valley Home Prices Cool After April Peak – Following record highs in April, home prices and sales in the valley are beginning to stabilize as the summer heat sets in.
Recent Price Trends
- Median Price Adjustment: The median price of detached homes in the Coachella Valley slightly decreased to $710,000 in May from April’s record $724,000, representing a 3.6% year-over-year increase.
- Palm Springs Market: The average price for detached homes in Palm Springs fell from $1.4 million in April to $1.3 million in May, but it was still 3.2% higher than the previous year.
Sales Performance
- Sales Activity: Palm Springs saw a 5% increase in home sales compared to last year, one of four valley cities with improved sales. Overall, valley-wide sales are 20% below average, a trend expected to persist until mortgage rates drop.
- High-End Market: Sales of homes priced over $1 million showed the most significant growth.
Market Insights
- Price Peak Timing: Historically, prices peak in May or June. With rising inventory and slower sales growth, the market is anticipated to shift in favor of buyers soon.
Inventory Status
- Current Levels: As of June 1, the valley-wide inventory reached 2,610 units, the highest in four years but still about 1,000 units below pre-pandemic levels. Palm Springs leads among valley cities in inventory, with 648 units available, up from 464 last year.
Expert Thoughts
- Future Sales: The report suggests, “Sales will recover when mortgage rates return to 5.5%-6%.” Despite the decline in inflation, the Federal Reserve Board remains cautious about lowering rates without more substantial evidence that inflation will stay down.
Future Perspective
- Inventory Projections: The report predicts a decline in inventory as summer progresses, emphasizing, “The key will be how much it declines.”
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