Palm Desert Home Values
Here are the market updates about Palm Desert Home Values over the past 2-3 months. Call or text John Campbell at 323-646-8558. Palm Desert is the heart of California’s Coachella Valley. Palm Desert’s outstanding quality of life offers residents and visitors of all ages a wide array of recreational, educational, shopping, housing, and entertainment opportunities as well as arts and cultural activities and world-class events in a uniquely beautiful desert environment. This premier resort destination is a thriving, safe, and sustainable community that attracts innovative employers by virtue of its diverse, highly qualified workforce and synergistic business, civic, and educational partnerships.
Palm Desert Housing Update
We asked our readers to keep an eye on the Fed’s plans to shrink its balance sheet and raise interest rates. The Fed taking action seemed like a forgone conclusion to battle rising inflation (now at levels we haven’t seen in forty years), the question was, and remains, how high and how fast would they take rates?
In December of 2021, we mentioned The Federal Reserve announced that it is “open” to speeding up the end of its bond-buying program and are signaling that interest rate hikes are coming in 2022.
In addition, we told our readers it looks like the Fed will be taking action faster and sooner than anticipated. It was thought the Fed would raise rates by a quarter percent three times in 2022, but in meeting minutes from their December meeting they indicated they could raise rates sooner, and at a faster pace than previously thought to fight inflation –perhaps beginning in March.
Rates are moving in a big way, but still very favorable to buyers. As of today (February 15th) the average conforming 30 year fixed rate nationally is just under 4% (as low as 3.625% on jumbo loans up to $1.5M), and has increased approximately 25% in the last 90 days. It’s hard to know exactly what to expect in the coming months as some policy makers are calling for swifter and more aggressive hikes like St. Louis Fed President James Bullard who would like to see a 1% hike by July 1st, which would likely mean a .5% increase in March, and .25% increases in May and June. Centrists among the top Fed officials appear skeptical of raising rates so aggressively and seem to be content with the three .25% increases in 2022 that had previously been discussed. Even if the Fed takes a more aggressive path, it will take more than interest rates increasing to 5-5.5% to slow our Housing market in the Coachella Valley in any kind of significant way.
The Outcome
However, if significant increases in rates were coupled with the Fed aggressively tightening monetary policy, we could see this impacting buyer demand more significantly. I read a Rueter’s article recently that indicated the analysts at Bank of America estimate that the Fed’s balance sheet will shrink to 31% of GDP by the end of this year from 36% currently, while the European Central Bank’s will shrink to 56% of GDP from 69% currently. If they are right it could represent liquidity drains of up to $1.5 trillion and $2 trillion, respectively. These are huge numbers that could put a massive strain on the stock market, which could also affect buyer demand in the valley. The last time the Fed used these tools together was in 2018, when the stock market swung 20% from it’s high to low that year.
The Fed’s intentions moving forward here will be something we continue to keep a close eye on. Palm Desert home prices are rising…
The Reality
Importantly, the valley’s real estate market yearns for that seasonal bump in inventory that just hasn’t materialized. The number of sales in January was down 17% from last January due to lack of inventory, but still approximately 23% higher than pre-pandemic levels. Multiple offer situations, with accepted offers at or above ask, are the norm, especially in Palm Springs, Indio and Cathedral City (Avg. 1.5%,1.1% & 1.0% above ask). As stated by the Palm Desert Chamber of Commerce.
Whether you are a seller or a buyer, there is still a great opportunity for you in this market. Let us help you navigate it. John Campbell has already helped 35 buyers and 26 sellers meet their real estate needs in the last 5 years.
Undoubtedly, reach out to John Campbell, a Real Estate Professional for more market information, or to see how much you can benefit from recent market trends on the sale of your home.
Click here for a FREE Palm Desert Home Value Report
Palm Desert Demographics
Land Data
- Area: 26.96 square miles (69.44 km2)
- Elevation: 220 feet (67 m) above sea level
- Coordinates: 33°43′20″N 116°22′28″W
Population Data
- Permanent Residents: 53,087
- Seasonal Residents: 32,000
- Median Resident Age: 55.1
Economic Data
- Taxable Sales: $1.66 billion
- Employment within City boundary: 40,156 jobs
- Unemployment Rate: 4%
- Employment Rate: 46.9%
Household Data
- Median Home Price: $532,500
- Median Household Income: $64,295
- Housing Units: 35,755
- Median Gross Rent: $1,353
- Home Ownership: 64.6%
Education Data
- Bachelors Degree or Higher: 38%
- School Enrolled Population: 56.9%
Palm Desert Weather
Ringed by three magnificent mountain ranges, Palm Desert is sheltered from coastal air pollution and inclement weather. With 350 days of sunshine a year, there is seldom reason to postpone outdoor fun. View our upcoming forecast.
- Mean Temperature: 73.1 Fahrenheit
- Average Sunshine: 350 days per year
- Average Rainfall: 3.38 inches
- Average Winds: 4 mph
| January | April | July | October |
| High: 70 | High: 86 | High: 106 | High: 91 |
| Low: 41 | Low: 59 | Low: 79 | Low: 62 |
