Media Releases

RELEASE DATE:
February 6, 2007

CONTACT:
Greg Berkemer
760) 346-5637
(Media Only) John Hussar
PRNewsWorks (760) 567-8073

PALM DESERT (Calif.) - The Coachella Valley's 2006 real estate market ended on balance a pretty "normal" year for sales and median price, the California Desert Association of REALTORS® reported today.

Home sales in 2006 dropped to 6,450 compared to 8,300 in 2005 and 8,542 in 2004, the latter two years often noted as the hottest sales market in a decade, according to Multiple Listing Service figures tallied by the California Desert Association of REALTORS®.

The median price of a single-family home was $385,000 last year, down about $10,000 from $395,450 in 2005.

"Because 2004 and 2005 were such exceptional years for sales, it's really hard to compare 2006 when you look at the cyclical nature of home sales in the Coachella Valley," said Greg Berkemer, executive vice president of California Desert Association of REALTORS®.

He also noted there will not be the 20 percent gains in home sales that characterized 2004 and 2005. "Increases will be more modest in the single-digit range and home sellers need to be more realistic in pricing their homes according to the current market."

Among the Valley's nine cities, Indian Wells saw the highest median sales price in 2006 at $1.165 million, while Desert Hot Springs, one of the new hot spots for entry-level homes, posted an average home sale of $286,000.

Berkemer noted that MLS figures showed a strong luxury home market in 2006 of homes priced $1 million and above. There were 237 homes over $1 million sold in La Quinta in 2006 while Rancho Mirage recorded 160 home sales in that same time period.

While sales fell and median prices rose in 2006 as the real estate market has softened, Berkemer pointed out that this market shift is a normal fluctuation and may be lessened by positive indicators of a strong economy, a full employment and continued low interest rates.

"We have a lot of second home buyers who can afford million dollar plus homes and those sales can increase the median price so it really is sort of a mathematical anomaly that the desert's median price can rise while overall sales decline," Berkemer said.

Berkemer urged consumers to talk to their Realtor about the neighborhood housing market instead of just looking at the national housing market, which is really an average of home prices across the country.

Still, the national outlook for home sales is positive as the local outlook.

"Despite all of the doom-and-gloom stories and dire predictions over the last year, 2006 was the third strongest year on record for existing-home sales," said David Lereah, chief economist for the National Association of REALTORS®.

"It looks like we're moving beyond the low for the housing cycle last fall, and buyers are responding to historically low interest rates and competitive pricing by home sellers. In addition, a tightening inventory of homes on the market is supporting prices."

Locally, December's median price fell 0.1 percent and sales declined by 22.7 percent from a year ago. However, December sales were up sharply over November, according to The California Desert Association of REALTORS®.

"We are seeing the market stabilize somewhat, but it is too early to tell how the market will change in 2007," said Emily DeSimone, president of the California Desert Association of REALTORS®.

The California Desert Association of REALTORS®, The Voice for Real Estate® for the Coachella Valley, represents more than 4,000 estate professionals from Palm Springs to Coachella.

For more information, please call (760) 346-5637 or visit online at www.CalDesertRealtors.Com