In-Depth Analysis of December 2023 Real Estate Market Trends
Median and Average Sales Prices Dynamics: The real estate market in December 2023 presented a nuanced picture regarding property pricing. The median sales price of $602,500, while down 4.36% from November’s $629,995, represented a significant year-over-year increase of 4.78% from December 2022’s $575,000. This figure is particularly notable as it’s the highest for any December in the past two years, indicating a long-term upward trend. On the other hand, the average sales price witnessed a decline of 8.29% month-over-month, settling at $793,432. However, compared to December 2022’s $744,797, this still marks a 6.53% increase, showcasing overall growth in the market value of properties.
Sales Price/List Price Ratio: The sales price/list price ratio, standing at 97.68% in December 2023, remained consistent with both the previous month and the same period in 2022. This stability suggests that, on average, homes sold for just below their asking price, indicative of a market where buyers and sellers are closely aligned in their valuation of property worth.
Volume of Property Sales and Market Absorption: December saw a total of 379 properties sold, a minor drop from November’s 386 sales, but notably higher than the 357 properties sold in December 2022. This moderate level of sales activity positions December 2023 as a steady month for property transactions compared to the past two years. The absorption rate, which provides insight into how quickly the market is moving new listings, remained at an average level, reflecting a balanced dynamic between supply and demand.
Average Days on Market (DOM) Trends: The increase in the average days on market (DOM) to 65 days in December 2023, from November’s 59 days and December 2022’s 59 days, indicates a subtle shift. This upward trend in DOM suggests that properties are staying on the market longer before being sold, potentially signaling a move towards more favorable conditions for buyers, where they have more time to make decisions and possibly negotiate better terms.
Sales Price per Square Foot Analysis: The average sales price per square foot in December was $373. This decrease of 3.37% from November aligns with the general cooling in prices but remains on par with December 2022. As a more normalized indicator of property values, this metric suggests that while there might be month-to-month fluctuations, the overall value of properties is maintaining a steady pace year-over-year.
Inventory Levels and Months of Supply Inventory (MSI): The inventory for December 2023 was lower than in November, with a 10.74% decrease to 1,920 properties. However, it’s slightly lower than December 2022’s inventory of 1,952 properties. The Months of Supply Inventory (MSI) for December stood at 5.07 months, indicative of a market that is neither overly saturated nor understocked, providing a relatively balanced playing field for both buyers and sellers.
New Listings and Market Entry: The number of new listings in December 2023 was 582, marking a significant drop from November but showing a robust year-over-year increase from December 2022. This highest level of new listings for December in recent years could be a response to the long-term appreciation in property values, encouraging more sellers to enter the market.
Key Takeaways for Buyers and Sellers: December’s market trends suggest a complex but balanced real estate landscape. Buyers may find more room for negotiation, given the slight increase in DOM and the stable sales price/list price ratio.
Sellers, while noting the month-over-month decrease in prices, can still be encouraged by the year-over-year gains and the consistent ratio of sales to list prices. The real estate market, thus, offers opportunities for both parties. Buyers could leverage the slightly extended selling periods and potentially negotiate more favorable terms. Sellers, meanwhile, can take advantage of the overall upward trend in property values, especially considering the increase in new listings, which indicates a healthy interest in market entry.
The December 2023 real estate market in Coachella Valley presents a nuanced and dynamic picture. While there are signs of cooling, the long-term trends continue to favor growth in property values. For buyers, this may be a favorable time to explore options and negotiate, while for sellers, strategic pricing and understanding current market dynamics will be key to successful transactions. As always, staying informed and working with knowledgeable real estate professionals is crucial in navigating this ever-evolving market landscape. Check out last months update here