For those of you with listing prices in the areas between $1.2M & $3.5M, do not be discouraged. I’ve recently fielded some calls from listed sellers along with prospects thinking of selling, with concern about the market. Many are told nothing is selling, and the interesting truth is the opposite is actually happening… the market overall continues to improve. The lack of a SOLD sign in front of your home in most cases is simply a seasonal inventory issue, with inventory in this price point average currently at 8.5 months. Remember back just 2 years ago… there was an 18 month inventory of Luxury homes in the valley. Below you will find the facts and forecast on the Luxury Home Market in my areas of expertise. Rancho Mirage, Palm Desert, Indian Wells, and La Quinta, and in price points from $1.2M up to $3.5M
Let’s rewind one year…
January 1st – February 20th 2013; there were 16 Luxury homes SOLD with a median sales price of $1,691,000
This year…
January 1st– February 20th 2014 there were 48 Luxury homes SOLD with a median sales price of $1,489,500, 3 times the amount of Luxury homes sales than in 2013.
The drop in median homes sales prices does not necessarily mean home values dropped, it simply means buyers in this time period chose to spend less on their home purchase, indicating buyers are price sensitive and all looking for great values. As an example… Canadians have recently lost 11% on their dollar, and many are still out looking & buying homes. They can simply be pickier with season inventory up and all buyers are looking for great values. Again… because the market has dramatically improved does not mean your Luxury home is worth more, it simply means you know have the opportunity to sell.
Looking into the future and knowing the market continues to improve overall, if last season’s numbers are indicative of this 2014 numbers, and knowing the beginning of this year’s sales were up 3 times last year’s numbers, I believe were in for a record breaking “late” sales season ahead of us.
Forecast… Let’s look at last year’s numbers.
February 21st – April 30th 2013 (a 70 day period) 70 homes SOLD (or 1 per day) with a median sales price of $1,612,000
May 1st – June 30th 2013 (60 day period) 59 homes SOLD (approx. 1 per day) with a median sales price of $1,600,000
Positive thoughts my friends… everywhere I go, whether it’s a fine restaurant or Starbucks for coffee, these establishments are teaming with people spending money and there’s a pulse in the air we haven’t seen in years. Let’s all be patient with the market, pass on those positive vibes, continue to think positively into the future, and I believe things will continue to improve sooner than later!