Every market in Real Estate is unique- Palm Springs is no different. Judging by the national news, one minute you’ll read half the homes sold are foreclosures; the next article will say prices are as low as they’ve been in 10 years, and then another will say foreclosure listings are drying up. What should you believe?
Let me clear this up for you. Here’s what’s going on in Palm Springs as of Spring 2012-
In February of 2011, we had almost an 8 month supply of inventory- What does that mean? Basically, at the rate of sales, it would take about 8 months to sell off all the inventory of homes available at that time. By comparison, in April of 2012, there’s only about a 2 month supply of homes, down over 60% from February 0f 2011.
Why do we look at these inventory numbers or care? Well, 3-4 months of inventory is average. Right now we have less then the average amount of homes to sell. What that will typically indicate, is that we may start seeing prices increase. Real estate is about supply and demand- no supply equals greater demand equals higher prices.
What’s going on with the average sales price? In Palm Springs, the average asking price for homes is about 10.6% higher then it was in February 2011. However, the actual selling prices of homes is about 2% less then it was in February 2011. There are a number of reasons for this, one could be the amount of actual homes being sold is down. The average sales price in March 0f 2012 comparted to April 2012, was up 3.5%. So my guess is because of the lower amounts of inventory, our sales prices declined slighting in April.
How long are homes staying on the market? That hasn’t really changed since February 2011 in Palm Springs. The average days on the market is 95.
Interest rates, its been reported, are also at an all time record low. This is one of the factors contributing to the amount of buyers entering the market, causing more competition for homes. Despite what some reports indicate, lenders are writing loans for purchases for those buyers with good credit and income that can be documented. We’re seeing downpayments of 10% to 20% typically, usually higher for foreign national buyers
Overall, we are seeing a shift in the market quickly- there are more buyers then we have homes to sell- as a result, the majority of offers we have submitted on homes at The Paul Kaplan Group, have resulted in multiple offer situations, competing with other buyers. At the end of May, we have 17 homes in escrow; out of those homes, 12 of them had multiple offers that we were competing with. We have a team of experienced agents that have excellent negotiation skills, and have been successful counceling our clients on how to present the winning offers that get accepted. So although it is challenging right now for buyers, with the proper strategy, you can buy a home!
Can you still get a “deal?” Yes- its doubtful you’ll get a house for less then 95% of the asking price in this market, but keep in mind that price is still probably lower then what it has been in 10 years. What about foreclosures? Yes, there still are some- keep in mind a foreclosure probably has been neglected and will need a significant amount of work- we’re not seeing anywhere near the amount of foreclosure listings that was used to see two and three years ago Regardless, it is still a good time to buy, according to experts.
The Paul Kaplan Group is here all summer to assist our clients with either selling their homes or purchasing a new one. Please call us for any additional information regarding today’s market. We’re here to help buyers and sellers navigate this ever changing real estate market, and to understand the Palm Springs market, compared to the national real estate news.