Palm Springs Housing Market Recap for 2022 and Forecast for 2023

Palm Springs Housing Market Recap for 2022 and Forecast for 2023

It’s safe to say that most of 2022 continued the trends of 2021 as a strong sellers market here in Palm Springs and throughout the Coachella Valley. Now with rising interest rates, falling sales, and rising inventory, things have taken a sudden change in the last quarter of the Southern California housing market.
 
Here’s a brief housing market recap for 2022 and housing market forecast for 2023 here in Palm Springs, the Coachella Valley, and throughout Southern California’s Riverside County.
 

Palm Springs Housing Market Recap for 2022

With an extremely rare trend of low inventory, low mortgage rates, and high demand for properties, sellers were rejoicing throughout 2021 and most of 2022 here in Palm Springs and throughout the Coachella Valley. Low-inventory properties attract multiple offers for sellers, and they also drive up the final sales price.
 
Now, after a two-year housing boom, the housing market in Southern California is finally moderating. As predicted, in October 2022, the median house price in Southern California declined 1.2% from September. In Riverside County, the median price rose 3.4% to $599,990, while sales decreased by 41.5%.
 
The Southern California housing market has now slowed substantially in recent months, mostly due to rising mortgage rates. This year, mortgage rates have climbed from the low 3% range into the 7% range. And while we’re starting to see a slight decline in housing prices, rising mortgage rates have continued to price many would-be buyers out of the market here in Palm Springs and the Coachella Valley.
 

Palm Springs Housing Market Forecast for 2023

Home prices in Palm Springs, the Coachella Valley, and throughout Southern California are projected to decrease by approximately 7% in 2023 as compared to 2022. You might think that paves the way for a buyers market, but buyers are struggling to finance with high interest rates – and mortgage rates are predicted to remain in the 6% range until the end of 2023.
 
According to experts, both national and Southern California prices will fall next year, which is something that has not occurred in over a decade. This is the result of falling sales and rising inventory, and some are even predicting a mild recession in the new year ahead.
 
It is projected that the Federal Reserve’s actions to fight inflation throughout 2023 will spark a mild recession. As a result, the statewide median price is anticipated to fall 7.1% in 2023 compared with this year, and we’ll also see similar declines throughout the Southern California housing market due to job losses and higher rates.
 
Looking ahead here in Palm Springs and the Coachella Valley, home prices will either decline or should be largely flat over the next few years. With all things considered, many would-be buyers are still sitting on the fence to see if prices will fall further.
 
That said, buyers that are ready to take the leap now and endure the higher interest rates for a year can always consider refinancing – and they will have already gained some good equity along the way.
 
Another silver lining for some buyers is that rising interest rates are making new mortgage buydown programs available to help streamline the buying process. A buydown mortgage is essentially a way for a borrower to obtain a lower interest rate by paying discount points at closing, or alternatively by deferring things to the sellers to buy down the interest rate within the offer.
 

Market Reports for Palm Springs and the Coachella Valley

For a deeper data dive, check out these market reports for Palm Springs and the Coachella Valley:
 
 
What Other Questions Do You Have?
 
Consider an experienced and knowledgeable local real estate agent (like me) to help you make sense of things.
 
If you’re ready to buy and or sell yourself, I look forward to assisting you. I promise to give you a much more targeted answer than Google or the news will ever be able to.
 
Please feel free to give me a call, text, email me – or let’s schedule a Zoom meeting.
 
I’m looking forward to hearing from you!
 
Your Palm Springs Insider,
Glen Nadeau
 
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PS- Are you a part of the LGBTQ+ community and looking to relocate to Palm Springs and the Coachella Valley? Check out our FREE “Palm Springs Enthusiasts LGBTQ+ Relocation Guide” and find out why Palm Springs is such an oasis of Pride and inclusivity – brought to you by The Palm Springs Guys and Glen Nadeau Real Estate 🏳️‍🌈

*We cannot guarantee any of the above statements or third-party links. Before you enter any transaction, you should read and review all contracts, leases, and information as they are unique and subject to changes. We recommend you consult with your accountant, attorney, tax advisor, and local real estate professionals prior to any real estate transactions.

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