It is time for another market update. In general, we have continued to be in a strong seller’s market. The months of supply ratio is a figure that measures the balance between supply and demand in real estate. A number of less than 6 months, which is a balanced market, is good for sellers. Meanwhile, any number over six months is good for buyers.
As of August 1, our months of supply ratio is 3.2. This is the lowest ratio we have seen since 2013. We can probably expect this number to decrease further over the next couple months before the seasonal forces take affect.
The median days on market was 67. This is 6.5 days less than it was last year at the same time.
In the above video at 1:12, you can see that the months of supply has improved for each price bracket except for the $700,000 to $800,000 range. All of the ratios below $700,000 are below four months, which is very positive.
For homes priced over $1 million, months of supply is 8.6 months which is down from 11.6 at the same time last year. This figure is a low ratio for that particular price range.
The median value of detached homes in each of the nine valley cities show strong 12-month gains. They range from a high 31.4% in Indian Wells to a 3.4% for Palm Springs.
Palm Springs, which has been the price leader in the region for the last three years appears to be temporarily slowing down. Meanwhile, other cities such as Palm Desert, Rancho Mirage, and Indian Wells seem to be playing catch-up.
Interest rates have continued to climb and the Federal Reserve is on track to make two more increases this year. The first of which will be at their September 20th meeting. This has put some urgency on buyers to secure properties so that they can lock in on an interest rate.
As interest rates increase, the number of buyers qualified for higher brackets will decrease. This may begin to create some softening effect on pricing in the higher tax brackets.
Our continued price appreciation and lower inventory point is a great time to consider selling your greater Palm Springs area home. If you are a buyer who is financing your purchase, there is more urgency to get in the market now before the interest rates impact your purchasing power.
If you have any questions about the value of your home or you are interested in buying in the Palm Springs area, please feel free to contact me. I look forward to speaking with you soon.