Market watch for the Palm Springs Valley, California
Our winter season, which is generally our busiest, because the Palm Springs Valley is essentially a tourist destination during the winter, has officially begun. Inventory is still low overall. When a home comes available that has the things our seasonal buyers really crave, meaning sunlight, mountain views, fairway location, and a fair market value, it will sell!
Home prices have shown little fluctuation while actual sales numbers continue to drop. Each city in the Palm Springs Valley, still shows year-over-year price changes. The largest gains surprisingly were in our very easterly city, Coachella. In just one year the price per square foot has gone up approximately 40%! I think that's because it is still the least expensive city to purchase a home in, and there are not a lot of sales there.
The city of Palm Springs continues to show the most gain when it comes to price. The price per square foot average is $270/sf., which is only 12% below the all-time high in 2006-07. Prices in Palm Springs are currently higher than any other desert city, including Indian Wells, which is normally the leader of the pack when it comes to expensive homes. The celebrities are coming back to Palm Springs, and modernism is all the rage again. Both factors are helping to drive the Palm Springs real estate market.
According to Market Watch LLC, there are only two things that could potentially drive the Valley sales up.
1. A lowering of the tight credit restrictions that are currently being imposed on home buyers. This would certainly help first-time buyers, but I for one, do not want to see the crazy loans become available again. A slight loosening perhaps?
2. Former homeowners that had short sales and foreclosures are re-entering the buyers market. Economists think that this factor alone could increase home sales from 5 to 10% over the next three years.
I know that I have personally worked with many of these “boomerang buyers”. Because I am a short sale specialist that closed hundreds of short sales from 2009 through 2014, I believe the second factor is going to figure in our Valley home sales very strongly. They are ready to enter the market again, and many do qualify for loans.
It also appears that home prices have become quite stable. It is certainly much easier to price very accurately a property when I go on a listing appointment. Having many recent closed sales, gives me lots of comparables, and we realtors are much more accurate when we have recent comparables to compare a property to. Short sales and foreclosures did not help us with this!
Overall, I'm looking forward to a robust 2015. Let the holiday season begin!