Hello, GOOD-BUY
April 2017 – Sales numbers seeing progress in the median home price segment, though the luxury market remains sluggish at best.
Year over Year, April sales numbers under the $750,000 price segment are showing improvement, with an increasing absorption rate due to lower levels of inventory and significant sales numbers in the median sales price range. Above the $750,000 price segment, the market clearly remains a buyers’ market, especially the luxury Home market, as high levels of inventory continue to outpace demand. Knowing this, it appears that many homes, especially the luxury home market in the eyes of the buyer appear to be over-priced. Today, buyers have a plethora of information available at their fingertips through online web-portals galore, that provide data that help them make an informed decision, though in many cases confuse them into a hold position. This is where the knowledgeable seasoned real estate professional can help direct that prospect into making an informed decision. Below you will find an illustration in both sales numbers and prices, within the down valley cities of Rancho Mirage, Palm Desert, Indian Wells, and La Quinta, the four cities I specialize in.
The real-time data below is derived from the California Desert Association of Realtors – Desert Area MLS 05.22.2017. *Months of inventory* offers you an idea of how many months it will likely take to sell your home. In a buyers’ market, pricing aggressively or ahead of the market, often gets your home sold faster, often without a price reduction, and in many cases for more money. Sellers must also have a willingness to reduce their asking price if necessary or be patient with what the market delivers, and a willingness to gamble with the market.
$250K-$500K – The median sale price segment experienced jumps in both the number of homes sold, as well as sales prices. For example; Rancho Mirage 42 Homes Sold this April with the average sales price $390,000, over 33 Homes Sold last April with an average sales price of $352,000, an 11% increase in value. Palm Desert 91 Homes Sold this April with an average sales price $370,000 (big jump), up 4 over 87 Homes Sold last April with an average sales price of $325,000, a 14% increase in value. Indian Wells 12 Homes Sold this April with an average sales price of $397,500, up 3 over 9 Homes Sold last year with an average sales price of $390,000, a 2% increase in value. La Quinta which historically has had the best growth over the past few years, was down 6 sales to 62 Homes Sold this April, with an average sales price of $344,500, up slightly over last April with an average sales price of $342,500 with 68 Homes Sold, an increase in value of .5%. STRONG sales activity considering there are 285 ACTIVE Listings in the above-mentioned price segment and areas.
$500K-$750K – As we get into higher price segments, the number of sales decline dramatically, though this price segment still enjoyed better numbers in both the amount of homes sold as well as some sales prices. Rancho Mirage 24 Homes Sold this April over 18 last April, though the Closing prices dropped from an average of $605,000 last April to $597,500 this April, 1.2% decline in value. Palm Desert 23 Homes Sold this April with an average closing price of $594,000, up from 21 Homes Sold last April with an average closing price of $550,000, an 8% increase in value. Indian Wells 10 Homes Sold this April with a decline in average closing price of $575,000, over 7 Homes Sold last April with a closing price average of $625,000, and 8.75% decline in value. La Quinta 32 Homes Sold this April with an average closing price of $640,000, up over 26 Homes Sold last April with an average closing price of $620,250, a 3.1% increase in value. SLOW TO MODERATE sales activity considering there are 369 ACTIVE Listings in the above-mentioned price segment and areas. *(5.4-Month Inventory)
$750K-$1M – Rancho Mirage was down in the number of homes Sold as well as prices, with 5 Homes Sold this April with an average closing price of $780,000, down from 8 Homes Sold last April with an average closing price of $875,000, a 12.2% decline in value. Palm Desert was par with 6 Homes Sold this April with an average closing price of $830,000, the same as last April. Indian Wells was up with 3 Homes Sold this April, par in closing price of $825,000. La Quinta was up slightly in sales with 14 homes Sold this April, though down in average closing price to $908,500, with 12 Homes Sold last April with an average closing price of $922,500, a 1.5% decline in value. SLOW TO MODERATE sales activity considering there are 234 ACTIVE Listings in the above-mentioned price segment and areas. *(8.4-Month Inventory -Supply of homes)
$1M-$1.25M – Overall this price segment dipped except for Indian Wells, which was up 4 closings, though each of them had serious price reductions prior to selling. Rancho Mirage – dipped with 3 Homes Sold in April with an average closing price of $1.110M. Palm Desert is slow moving with 1 Home Sold this April at $1.2M, down in value from last April with 1 Closing at $1.125M. Indian Wells 4 homes Sold, up from zero last April with an average closing price of $1.112M (As mentioned above with substantial price reductions prior to selling). La Quinta Par with 4 Homes Sold, though closings prices dipped from $1.150M last April to $1.125M this April, decline 2.3% in value. SLOW sales activity considering there are 131 ACTIVE Listings in the above-mentioned price segment areas. *(11-month inventory- Supply of homes)
$1.25M-$1.5M – Sluggish Luxury Market – Price reductions seem to be the key to selling luxury homes these days. Rancho Mirage A jump in sales with 5 Homes Sold (mainly new construction) with an average closing price of $1.35M, over zero closings last April. Palm Desert Par with 1 closing at $1.499M, over last April closing at $1.255M. Indian Wells was quiet with no Homes Sold this April, and 4 Homes Sold last April, with an average closing price of $1.337M. La Quinta Par with last Aprils 4 closings, though the average closing price dropping from $1.409M last April to $1.38M this April. SLOW sales activity considering there are 117 ACTIVE Listings in the above-mentioned price segment and areas. *(11.7-month inventory- Supply of homes)
$1.5M-$1.75M – Sluggish Luxury Market. Rancho Mirage 3 closings this April, up by 2 over last April 1 closing, though closing prices dipped from $1.695M last April to an average of $1.595 this April, a 6.25% decline in value. Palm Desert has no Closings this April and only 1 last April. Indian Wells 2 closings this April, with an average closing price of $1.627M, up from 1 closing last April at $1.515M, up 7.4%. La Quinta 3 Closings this April with an average Closing price of $1.625M, up from 2 Closings last April at $1.637M. VERY SLOW considering there are 61 ACTIVE Listings in the above-mentioned price segment and areas. *(12.2-Month Inventory – Supply of homes)
$1.75M-$2M – Sluggish Luxury Market. Rancho Mirage 1 Closing @ $1.875M, over zero movement last April. Palm Desert -Zero movement this April with only 1 Closing last April @ $2M. Indian Wells 1 Closing @$1.825M, over last April with zero movement. La Quinta was par with last April with 2 Closings @ $2.075M slightly up over last April average @ $2.047M. VERY SLOW considering there are 59 ACTIVE Listings in this price segment. *(14.75 Month Inventory -Supply of homes)
$2M – $2.5M – Sluggish Luxury Market. Rancho Mirage and Palm Desert with zero Closings. Indian Wells 2 Closings, par with last April averaging $2.25M, over last April @ $2.22M. La Quinta down to 1 Closing this April @ $2.075M, with 2 Closings last April with an average of $2.047M. VERY SLOW considering there are 71 ACTIVE Listings in the above-mentioned price segment and areas. *(2-year inventory-Supply of homes)
$2.5M – $3M – Sluggish Luxury Market. Rancho Mirage was par with 1 Closing this April @ $2.8M, and 1 last April @ $2.6M. Palm Desert with zero Closings this April, 1 last April @ $2.675M. Indian Wells with zero Closings this April, and 1 Closing last April @ $2.9M. La Quinta was par with 1 Closing this April @ $2.85M, and 1 Closing last April @ $2.595M. VERY SLOW moving considering there are 47 ACTIVE Listings in the above-mentioned price segment and areas. *(2-year Inventory -Supply of homes)
$3M & Up – Sluggish Luxury Market. Rancho Mirage 1 Closing in April @ $3.45M, Palm Desert Zero Closings this April, 2 last April averaging $4.825M, Indian Wells improved this April with 2 Closings averaging $3.94M, and Zero closings this April. La Quinta enjoyed 2 Closings this April averaging $7.9M, with zero Closings last April. VERY slow moving considering there are 125 ACTIVE listings in this price segment in the above-mentioned price segment and areas. *(25 months Inventory or just over 2-year supply of homes)
Buyers, as you can see above, it clearly remains a buyers’ market. This brings opportunity in the eyes of savvy buyers, who have been thinking about buying a home in our beautiful sought after Coachella Valley.
Sellers, my advice is to look at your home and value, in the eyes of the buyer and be realistic with your expectations. Improvement in the down valley market is a slow process, though overall, we do continue to see progress. As indicated above, inventory clearly continues to outpace demand in almost every price segment, providing a plethora of inventory for buyers to choose from. Currently 52% of homes sold in the areas above have been reduced 1-2 times prior to receiving a negotiable offer. If you are a serious motivated seller, and your home is sitting unsold, it is time to become aggressive with your asking price, and have a willingness to reduce even more if necessary, or the likelihood is your home will sit unsold. The question is: What is it costing you to sit unsold? It is all about your level of motivation to get your home Sold.
I hope you found this market update helpful and informational. If you have an interest in buying, or selling, or have questions or comments, I welcome the opportunity to speak with you.
For more details on sales numbers, please click here.