Anyone paying attention to the housing market will have heard the recent predictions of a market correction. With interest rates increasing and prices decreasing, it has been the subject of much speculation. Many economists believe there is already a market correction underway nationally.
Just because the national market is in correction doesn't mean every regional market is also. A market like Palm Springs is unique, as not only is it a very desirable place to live, it's also a popular tourist destination. This post will cover a few points that indicate whether the Palm Springs housing market is in correction.
Signs of Palm Springs Housing Market Correction
Days on the Market
The number of days homes sit on the market can indicate where the market is heading. If the time it takes to sell a home increases, it can mean a decline in demand. As of December 2022, Palm Springs homes are on the market for an average of 54 days. That is up from a low of 39 days in May. However, that difference could be seasonal. On average, in December 2021, homes stayed on the market for about 46 days. That is only a difference of eight days year-over-year.
Total Home Sales
The number of home sales at a given time can also indicate whether a market correction is occurring. There were 95 home sales in Palm Springs during December of 2022. That is just over half the number from the same time last year. With inventories in the Valley increasing, a significant decrease in sales could indicate a correction is underway.
Sale Prices
Sale prices can be one of the clearest signals when analyzing the condition of a housing market. The median sale price for homes in Palm Springs was $620,000 in December 2022, which is up from $499,500 in December 2021. However, it is a decrease from the high earlier in 2022. The median sale price was $719,000 in April 2022.
List Price vs. Sale Price
The comparison of list prices to sale prices can also be telling. If homes consistently sell for below list price, it could indicate a market correction. The average sale in Palm Springs was about 2.11% under the list price in December of 2022. This trend has also held for several months.
While there are signs of a market correction in Palm Springs, the area has a strong and steady market. Much of this is due to its popularity as a place for relocation. Most experts expect it to fare better than many other parts of the country.
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