Palm Springs Real Estate price trends have been a bit of a surprise so far this quarter. Since inventories have grown by over 50% in the last six months, you would think that prices would be under some downward pressure. However, that is not the case. Prices over the last six months have, in fact, increased over 11% since last August, although they have been down slightly in the last month. Here’s a breakdown on current price trends:
- Low End Properties – below $200K
With inventories up about 45% in the last six months, prices are up only slightly at 3.9% – a surprise, given that investor activity over the last year pushed up prices over 13% in 2012. In fact, in the last month prices have actually dropped about 2%. I suppose the old adage that prices fall as inventories rise is being felt in this range.
- Upper Low End Properties – $200K to $500K
Property inventories are up about 53% in the last six months, with prices up a healthy at 8%. Prices in this category have risen steadily since August in spite of the substantial inventory increase.
- Moderately Priced Properties –$500K to $1M
Inventories are up about 40% with prices continuing to hold at about the same as six months ago. There is a slight increase of less than 2% which is good, in light of the large inventory increase.
- High End Properties of over $1Million
Inventory almost doubled to 63 units, from 34 in August – an increase of over 85%. Prices have seen a pretty healthy increase of over 10% in spite of the significant increase in available properties.
In summary, we entered our peak snowbird season this season with historically low inventories and a strong trend of increasing prices. During the season, we’ve had the predictable increase in sales inventory across all price range . So as the snowbirds depart in the weeks ahead, it will be interesting to see if we experience the customary drop in inventory numbers that usually follows their departure.
Also, since prices have held pretty flat or have risen in the environment of increasing inventory, the question is – will prices trend up as inventory falls? My guess is that prices will be under increasing downward pressure and averages will fall somewhat with fewer potential buyers about and sellers wanting to move their inventory.
Stay tuned for my next Trends blog in a couple of months, and remember to call if I can be of help with any of your real estate needs. I’ll be happy to help.
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