May 2020 Hi Desert Real Estate Market Update

Spring Greetings Real Estate Fans!

Once again it is time for my monthly real estate market update. April is in the bag and we are moving towards summer. Obviously, the Pandemic is taking a toll on our market just like most around the nation. Yes, we are selling real estate (at this writing I have four open escrows). Just like last month, I still maintain that no one has any idea what to expect as we come out of this. I have no intention of piling my opinion on to the countless opinions you have heard. Here is what I know about the virus and how it is affecting our market:

1. Lending continues to be an issue. Each day we see properties go into escrow and almost the same amount of properties fall out of escrow. Most of the cancelled escrows are caused by changing job conditions or changing loan conditions. I have a client I have been working with since last October. Finally found a house only to discover he no longer qualified for his loan. This change happened between April and early May.
2. It is becoming harder to show properties. All homes on the market must post a sign requiring mask and gloves along with about four other items. All people entering a home must sign a disclaimer that they will follow the rules. Imagine having your home for sale and having to have a posted sign at the front entrance with six rules to see the house! This is true for offices only more so. The office must have a virus plan, certified cleaning products and a several times a day cleaning schedule. As this goes on, look for more rules to protect all of us involved.

Now about our local market…

I am frequently asked why don’t I split out Landers, Pioneertown, and Morongo Valley in my report. The answer is because there are so few sales that the numbers have huge swings that overall do not make sense on a monthly look. Below is a table that shows the amount of sales and price per square foot for all of 2019 and the first trimester of 2020 for the three communities. I was amazed at the price per square foot in Morongo Valley ($192.11) and Pioneertown ($473.59) so far this year. Here is the table:

(Total Sales/Price Per Square Foot)

Highlights of this Update include:

1. Inventory is at 2017 levels. At 374 homes for sale we are pretty skinny.
2. Closed escrows down from last year by 13 homes. Remember most of the escrows that are closing were opened before the quarantine. The next two months will begin to show the impact of the pandemic.
3. I can’t believe I am saying this but…Twentynine Palms is the ray of sunshine in this month’s Update. In April, Twentynine Palms was the only community up in sales, up in average price, and up in price per square foot. All other communities were down in these areas!
4. The $200,000 to $300,000 price point is our new “sweet spot”. One third of our areas sales are in this price bracket alone.

I hope you are finding a silver lining in all of this mess. If you have questions about anything related to real estate, please don’t hesitate to ask. I have been staying current on the forbearance issues, lending issues, and of course our market issues. Have a safe start to your summer season!

Sincerely,

Bob Armstrong
(760) 221-2999
DRE #01275801
️GREEN Real Estate Group