Coachella Valley Housing Market Update (November 2024 Report)

The November 2024 housing report for the Coachella Valley paints a complex picture of a market transitioning from the highs of the pandemic boom to more balanced conditions. While there are encouraging signs for both buyers and sellers, challenges persist that will shape the market as we move into 2025.  

Key Market Highlights

Prices Begin Seasonal Uptick
For the first time in six months, the median price of detached homes in the Coachella Valley increased, ending November at $634,990, which is $15,000 higher than the same time last year. This reflects a return to seasonal patterns, where prices typically recover toward the end of the year.  

Attached homes, on the other hand, showed a median price of $447,000, which is $8,000 lower year-over-year. While detached homes are seeing gains in cities like Indian Wells (+11%), others like La Quinta are experiencing declines (-7.6%), indicating that location is playing a significant role in price trends.  

Inventory Levels Normalize
The Coachella Valley now has 3,187 active listings, an increase of 869 units from last year, marking the first time since 2020 that inventory has surpassed 3,000 homes. This surge in inventory has pushed the months-of-sales ratio to 5.3 months, signaling a market moving toward balance but with supply beginning to outpace demand in some areas.  

• Indian Wells has the highest months-of-sales ratio at 15.3 months, suggesting potential downward pricing pressure in the luxury segment.
• Cities like Coachella and Desert Hot Springs, with ratios below 6 months, remain hot spots for faster sales.  

Sales Below Historical Norms

Sales are still recovering, running at 32.1% below historical averages. The three-month average sales volume in November was 472 units, slightly lower than last year’s 477 units. Dollar sales also reflect this cooling, with total transactions valued at $365 million, down 3.4% year-over-year.  

Challenges for Buyers and Sellers

For Sellers: Rising Inventory Means Stiffer Competition

As inventory continues to rise, especially in the luxury market, pricing your home competitively is critical. While some cities and price segments are seeing gains, homes over $2 million are now selling with an average discount of 5.2%, up from 3.4% a year ago.  

For Buyers: Opportunities Come With Caveats

Buyers now have more options and negotiating power, especially in cities like **Rancho Mirage** and **Indian Wells**, where discounts are highest. However, higher mortgage rates continue to impact affordability, limiting buying power despite the increase in inventory.  

A Look Ahead: What to Expect in 2025

As we move into 2025, several factors will influence the Coachella Valley housing market:  

1. Seasonal Price Recovery Likely to Continue:
   Detached and attached home prices are expected to rise modestly into early 2025, following typical seasonal patterns. However, further price stabilization is anticipated as the market balances out.  

2. Inventory Growth Will Continue Through February:
   With inventory already surpassing 3,000 homes and expected to rise further, competition among sellers will increase, particularly in the higher price brackets.  

3. Sales Recovery Hinges on Mortgage Rates:
   While the Federal Reserve has begun easing short-term rates, long-term mortgage rates remain stubbornly high. A significant drop in rates could reignite buyer activity, but without that, sales are likely to remain subdued.  

4. Luxury Market Faces Pressure:
   The higher months-of-sales ratio in the luxury segment suggests that sellers in this category may need to adjust pricing strategies to attract buyers.  

Positive Trends to Celebrate

Despite challenges, there are several reasons for optimism:  

• Quick Selling Times in Some Areas:
     Cities like Desert Hot Springs (34 days) and Indian Wells (35 days) boast some of the shortest median selling times in the region, highlighting pockets of strong demand.  
• Sustained Regional Appeal:
     The Coachella Valley remains a desirable location for buyers seeking lifestyle and climate benefits, ensuring long-term demand.  
• Stable Price Discounts:
     Overall, homes are selling with average discounts of just 2.1% for detached homes and 2.6% for attached homes, maintaining relative stability compared to last year.  

Final Thoughts

The Coachella Valley market in November 2024 (click here for the full report) reflects a shift toward normalization, with rising inventory, stabilizing prices, and subdued sales activity. Buyers are enjoying more choices, while sellers need to adopt strategic pricing and marketing approaches to stand out in an increasingly competitive landscape.  

Looking ahead, 2025 will likely bring a balanced market with opportunities for those prepared to navigate its complexities. Whether you’re buying, selling, or just exploring your options, now is the time to stay informed and act strategically.  

As always, I’m here to help you navigate this evolving market. Reach out anytime to discuss how these trends impact your real estate goals.