Palm Springs Real Estate Market

As we enter the final quarter of 2024, the Palm Springs real estate market continues to demonstrate its unique blend of stability, luxury, and opportunity. Known for its iconic mid-century modern homes, stunning landscapes, and vibrant lifestyle, Palm Springs remains a sought-after destination for buyers and investors alike.

With both national and global factors influencing the market, it’s essential to understand the current trends, price fluctuations, and forecasts for the end of 2024. Whether you're considering buying, selling, or investing in Palm Springs, here’s a comprehensive look at the real estate landscape for Q4 2024.

The Palm Springs real estate market has seen property values consistently rise throughout 2024, with prices stabilizing slightly as we approach the end of the year. As of the fourth quarter, the median home price in Palm Springs sits at approximately $750,000, representing a modest year-over-year increase of about 6%. This growth, while slower than in previous years, reflects the broader trend of cooling markets across the country as mortgage rates and inflation impact buyer confidence.

Luxury properties in Palm Springs, including estates in neighborhoods such as Vista Las Palmas and Old Las Palmas, continue to command premium prices. These high-end homes often range from $2 million to over $5 million, with properties featuring unique architectural elements, large lots, and desirable amenities like pools, views, and proximity to downtown Palm Springs seeing strong demand.

Condos and townhomes in Palm Springs offer a more affordable entry point into the market, with prices ranging from $400,000 to $650,000. These properties, often located in resort-style communities, appeal to retirees and second-home buyers drawn to their low-maintenance lifestyle.

Several key trends are shaping the Palm Springs real estate market in the last quarter of 2024, driven by both local demand and larger economic conditions.

One of the defining characteristics of the Palm Springs market is the significant presence of second-home buyers and vacation property investors. As remote work continues to be a viable option for many professionals, Palm Springs remains an attractive location for buyers looking for a second home or vacation rental property. The city’s proximity to Los Angeles, San Diego, and other Southern California markets makes it an ideal getaway, and its year-round sunshine offers the perfect escape from harsher climates.

In Q4 2024, the demand for vacation homes and investment properties is particularly strong. The short-term rental market, which thrives in Palm Springs, has remained robust despite increased regulations in some areas of the Coachella Valley. Properties that are eligible for short-term rental permits continue to see a premium, with buyers willing to pay more for homes that can generate income through platforms like Airbnb and VRBO.

Palm Springs’ reputation as a hub for luxury living remains a major draw, particularly for buyers seeking distinctive architectural styles like mid-century modern homes. The luxury market in Palm Springs has remained resilient in 2024, even as other markets across the country have experienced slowdowns. High-net-worth buyers, many looking for vacation or retirement homes, continue to invest in premium properties.

In particular, homes with unique amenities such as expansive outdoor living spaces, modernist design elements, and eco-friendly features are highly desirable. With sustainability becoming a growing priority in luxury real estate, homes equipped with solar panels, energy-efficient appliances, and smart home technology are commanding higher prices.

One of the most significant factors influencing the Palm Springs market in Q4 2024 is the persistent low inventory. While there has been a slight increase in listings compared to the first half of the year, inventory remains tight, keeping upward pressure on prices. Sellers continue to benefit from this environment, as demand outweighs the supply of available homes, particularly in the luxury and mid-range markets.

This imbalance will carry through the rest of the year, making Palm Springs a seller’s market. Buyers should be prepared for competitive bidding, particularly for well-priced properties in desirable neighborhoods like Movie Colony, The Mesa, and Araby Cove.

Rising interest rates have had a noticeable impact on the Palm Springs real estate market, as they have across much of the country. Mortgage rates in 2024 have risen to an average of around 7%, which has slowed the pace of sales, particularly among first-time buyers and those looking for more affordable homes.

However, Palm Springs has historically attracted many cash buyers, particularly in the luxury segment, which has helped mitigate the impact of rising interest rates. Investors and second-home buyers less reliant on financing continue to drive market activity, even as higher rates make affordability more challenging for some buyers.

Looking ahead to the end of 2024 and into 2025, several factors are expected to influence the Palm Springs real estate market. While price appreciation may slow compared to the rapid gains of recent years, the market is likely to remain stable, with modest growth continuing.

The demand for vacation properties and second homes is expected to remain strong in Palm Springs, particularly among buyers from neighboring metropolitan areas. As more people continue to prioritize lifestyle over proximity to work, Palm Springs will likely see steady interest from remote workers, retirees, and investors looking for short-term rental opportunities.

As sustainability becomes a key consideration for homebuyers, the demand for eco-friendly properties is expected to grow. Homes equipped with solar power, energy-efficient systems, and sustainable materials will likely see increased demand in the coming years. Palm Springs, with its sunny climate and history of architectural innovation, is well-positioned to lead this trend.

While inventory levels remain tight in Q4 2024, there are indications that more sellers may enter the market in 2025, particularly if price appreciation slows and economic conditions stabilize. This could help balance the market somewhat and provide more opportunities for buyers. However, the demand for premium properties in desirable locations is likely to remain high, keeping competition strong in certain segments.

For buyers, the Palm Springs market continues to offer significant opportunities, particularly for those looking for long-term investments. While rising interest rates may create challenges for some, cash buyers and those investing in luxury properties will find ample opportunities in the Palm Springs market. Buyers should be prepared for competition, particularly for homes with unique architectural features or vacation rental potential.

For sellers, Q4 2024 represents an ideal time to list properties, particularly given the low inventory and strong demand. Homes that are well-priced and feature the amenities today’s buyers are looking for—such as modern design, sustainability, and outdoor living spaces—are likely to sell quickly and at a premium.

Whether you’re buying, selling, or investing in the Palm Springs real estate market, the Bernal-Smith Group offers expert guidance to help you navigate the current trends and opportunities. With in-depth knowledge of the local market and a proven track record of success, the Bernal-Smith Group is your go-to resource for all your real estate needs in Palm Springs.

Visit BSGLuxuryHomes.com to explore the latest listings and learn more about how we can help you achieve your real estate goals.

_{*Header photo courtesy of the Bernal-Smith Group}