Palm Springs Area Home prices hit '03 levels, Sales Abound

According to a recent article in The Desert Sun, the median price of homes in Palm Springs and the Coachella Valley fell 34 percent in October to $225,000, a level not seen since February 2003.

DataQuick, a San Diego-based real estate research firm, reports that the drop is largely due to an unusually high number of short sales and foreclosed properties on the market. These opportunities to purchase distressed properties at great deals drove the volume of sales up significantly.

In October, there were 853 sales of new and resale houses and condos that closed escrow. That's nearly a 32 percent increase in home sales in Palm Springs and Coachella Valley, which strongly depends on real estate to power its economy. This followed the September result of 865 homes closing escrow, recording a 65 percent year-over-year hike, the likes of which haven't been seen since January 1988.

Fifty-one percent of the homes that closed escrow in October across Southern California had been foreclosed on at some point over the year. DataQuick spokesman Andrew LePage said the percent of all resales — existing homes and condos — in Riverside County that have been foreclosed on in the prior 12 months was even higher at 67.7 percent

The percentage for Palm Springs and the Coachella Valley was not reported, but local real estate experts noted the percentage of foreclosed property in the Multiple Listing Service is in the range of 30 percent to 40 percent. "We've had a huge jump in sales over the last two months, but we're seeing a market where foreclosures and short sales are bolstering the numbers," said Sam Schenkl, executive officer of the Palm Springs Regional Association of Realtors.

It also is playing out against a global backdrop of tough economic times, experts said. The October sales predate the Wall Street roller coaster ride, bank failures, job losses and credit crunch.

"For the housing market to continue to recover, it will require good news from the general economy, banks loosening (their) credit, government assistance programs to take effect and a return of liquidity to the marketplace," Berkemer said.

Yet the brisk sales pace shows that buyers are responding to hearty stock of houses on the market at reasonable prices. Most of the price reductions have taken place, and new properties coming in are matching the prices, Berkemer added, observing: "Buyers are in a good place."

Interested in buying or selling a home in the Coachella Valley area? Contact Patrick Stewart Properties.