Strong buyer activity in Coachella Valley Real Estate has continued into the fall. With stronger buyer activity in the market this year and the continued constrained supply of homes for sale, speedy sales and multiple offers are likely to remain a common occurrence and will keep the housing market hot even when the weather is cooling.
The median price in September was $510,000, which is up 26% over a year ago in the greater Palm Springs area. This is the largest percentage price increase since 2012. The median attached home price in September was $305,000, up 12.5%.
The median price of a detached home in La Quinta is up almost 30% above year ago.
Coachella Valley housing inventory continues to hover at historically low levels. On October 1st there were only 1,995 units for sale. Because of growing sales and record low inventory, the “months of sales” ratio is again at a record low of 2.5 months. The ratio is really a measurement of demand versus supply and a low ratio of 2.5 months is a mathematical sign that demand far exceeds supply.
While mortgage rates remain near record lows, The Mortgage Bankers Association reports that lending standards are tightening, which makes it a bit more difficult for some buyers to qualify. At the same time, unemployment remains substantially higher than a year ago due to COVID-19. Despite all this, buyers are out in full force this fall, showing amazing resilience in the middle of a pandemic. In the latest survey of California REALTORS®, the percentage of respondents with a buyer who withdrew an offer on a home that they had been ready to move forward with declined by 17.2%. Buyer demand has been ferocious as evidenced by mortgage applications and as rates have remained low, fewer are trying to back out of deals (Great time to sell).
We have made tremendous progress in the past few months, and things continue to improve. However, many households continue to face financial challenges so the prospect of a big gap between now and another round of stimulus is worrisome as many sectors are poised for additional layoffs. Fortunately, real estate remains the bright spot and is expected to continue to be over the next few months (Great time to sell!).
Tips for Buyers
- In a highly competitive market, it is common for sellers to pick a date and time to review all offers at one time. If this is the case, you may not have an opportunity to negotiate back and forth with the sellers. Presenting your strongest offer will give you a higher chance of the scale tipping in your direction when the seller needs to choose an offer.
- Overall, homes are selling like hot cakes, which is leaving no time to waste in the process. You may not have time to “sleep on it” or shop around when you find a home you love. Chances are someone else loves it, too. If you wait too long you may not even have a chance to get your offer in.
- You will have to make your offer strong enough to beat out a multiple-bid situation. If you want the house, you’re likely going to have to go above the asking price. Making an offer above asking price won’t end up costing you much in the long run. What you put down and what you pay monthly on your mortgage will only change significantly if you offer an unrealistic amount above asking. Keeping your offer aligned to the home’s value, while still above the asking price, will help you secure the home you’re interested in.
Tips for Sellers
- Homebuyers who are concerned about COVID-19 will have a better experience if they can walk your home without touching anything. Make it an easy walkthrough. Turn on lights and opening closet doors, especially the master bedroom closet.
- Hire a real estate agent with a broad online marketing program, which includes a 3D tour, Facebook tour, video, and plenty of photos. Many buyers do not want to fly, and with modern technology and a good Palm Springs realtor there is really no need to make a trip to Coachella Valley to purchase a home.
- Do not wait. There are home sellers who put off listing their home because they are waiting for the highest point in the market. No one knows or understands what the future holds and holding off on selling a home, banking on a higher return later is dangerous — just as the folks discovered in 2006. The right time to sell is when you are ready to move on with your life.
If you would like a FREE CMA or Comparative Market Analysis of your home in Coachella Valley then please contact us so that we can do an accurate analysis on your home.