The local housing market entered the summer season with a split personality in May: fewer closed sales, lower median prices and more days on the market, but also a sharp increase in single-family homes going under contract.
It was not a market in retreat. It was a market being repriced.
Single-family home sales fell from a year earlier. Condominium sales dropped more sharply. Median prices declined in both categories. Yet the number of single-family homes entering escrow jumped more than 30 percent compared with May 2025, suggesting that buyers are still active when the price, condition and terms line up.
For sellers, that is the difference between a disappointing market and a disciplined one.
“This is a market where buyers are still participating, but they are not giving sellers the benefit of the doubt,” said Jon Gordon, a long-time local realtor with Rosenthal & Associates. “The homes that make sense are getting attention. The homes that are priced for a market we are no longer in are sitting.”
The May data, sourced by Gordon from the California Desert Association of Realtors’ Monthly Market Summary, captures a familiar seasonal transition for Greater Palm Springs. The region’s peak visitor and selling season has passed. Summer is approaching. Casual buyers thin out. Serious buyers remain, but they usually have more time, more choices and more negotiating leverage.
This year, that seasonal shift is being reinforced by affordability pressures, mortgage rates that remain elevated by historical standards, and a buyer pool that appears increasingly unwilling to chase listings above perceived market value.
Single-Family Market: Fewer Sales, But Stronger Pending Activity
The single-family market showed the clearest tension in May.
There were 464 single-family sales in Greater Palm Springs, down 4.3 percent from 485 sales in May 2025 and down nearly 20 percent from April. The median single-family sale price was $650,000, down 3.7 percent from both April and May of last year.
On its face, that looks like a softer market. But the forward-looking numbers tell a more complicated story.
Listings under contract rose to 618 in May, up 30.7 percent from 473 a year earlier. That is one of the strongest signals in the report because it indicates buyers were still making commitments even as closed sales declined.
The market is not lacking demand. It is filtering demand.
Gordon said that distinction is important for sellers trying to interpret the numbers.
“Buyers are not gone,” he said. “They are simply more selective. They are looking more closely at price, condition, location, monthly payment and what else is available. If a seller is realistic on those points, there is still a deal to be made.”
Inventory also tightened significantly. There were 2,589 single-family homes on the market in May, down 23.2 percent from 3,369 a year earlier and down 10 percent from April. New listings fell to 692, down 20.6 percent from May 2025.
The shrinking supply helped bring months of supply down to 5.9 months, compared with 8.1 months a year earlier. By that measure, the single-family market moved closer to balance, even as prices softened and sales slowed.
The problem for sellers is that lower supply has not translated into stronger pricing power. Single-family homes averaged 84 days on market in May, up from 64 days a year earlier and 75 days in April. The sale-to-list price ratio was 96 percent, meaning the typical sale closed about 4 percent below the final list price. The sale-to-original-list-price ratio was lower, at 92.6 percent, showing that price reductions remain part of the path to a completed transaction.
That is the market’s message: inventory may be lower, but buyers still have time.
Condos Take A Sharper Hit
The condominium market weakened more visibly in May.
There were 193 condo sales in Greater Palm Springs, down 19.2 percent from 239 a year earlier and down 26.3 percent from April. The median condo sale price fell to $435,000, down 12.8 percent from April and down 7.4 percent from May 2025.
That decline does not necessarily mean every condo community lost value. Monthly medians can swing with the mix of properties sold. But the size of the drop is still notable, especially when paired with lower sales volume and longer market times.
Condos averaged 76 days on market in May, up from 60 days in April and 69 days a year earlier. The average sale price per square foot was $353, down 2.3 percent from last year and 3.6 percent from April.
Gordon said condos are facing a more complicated buyer calculation than detached homes.
“Condo buyers are not just looking at the purchase price,” he said. “They are looking at HOA dues, insurance, reserves, amenities, rental rules and how much work the unit needs. A condo that looks affordable on price can become less affordable very quickly when the monthly costs are added up.”
That is especially important in our region, where the condo market includes golf course properties, seasonal second homes, older resort communities, short-term rental candidates and units that may require substantial updates.
The May report did include some stabilizing signals. Condo inventory fell to 1,319 listings, down 9.8 percent from a year earlier. New condo listings dropped 18.6 percent year over year to 307. Listings under contract rose 8.9 percent to 220.
The sale-to-list price ratio also improved to 97.1 percent, up from 96.2 percent in April. That suggests buyers who did purchase condos were willing to pay closer to the final asking price, likely for properties that had already been adjusted or were priced competitively from the start.
But the broader condo market remains cautious. With 7.1 months of supply, buyers still have room to compare options and negotiate.
A Balanced Market That Feels Different For Buyers And Sellers
Both the single-family and condo reports placed the market near the balanced range. That is an important word, but it can be misleading.
Balanced does not mean easy.
For sellers, a balanced market can feel slow because homes do not automatically sell at ambitious prices. For buyers, it can still feel expensive because prices remain high relative to local incomes, and mortgage rates have not returned to the levels that fueled the pandemic-era boom.
In May, Greater Palm Springs was balanced, with neither side having overwhelming control. But the market psychology appears to favor buyers more than the raw inventory numbers suggest.
Buyers are taking longer. They are writing offers below list. They are asking more questions. They are factoring in renovation costs, insurance, HOA dues and monthly payments. They are also watching national economic signals more closely than they did when rates were lower and prices were rising quickly.
Sellers, meanwhile, are confronting a market where the first list price matters more than ever.
“You cannot use 2021 or 2022 as your mental comparable,” Gordon said. “That market is gone. Today’s buyer is not just buying the house. They are buying the payment, the risk and the alternatives.”
National Conditions Are Reinforcing The Local Shift
The local pattern fits within a broader national housing market that remains constrained by affordability issues.
National existing-home sales rose in May to their strongest pace in several months, according to national real estate data, and the national median existing-home price continued to rise modestly from a year earlier. But mortgage rates remained in the mid-6 percent range, keeping pressure on buyers and limiting how much they can pay.
The West showed a different pattern from some other regions, with national data indicating that sales activity improved from a year earlier, while median prices in the region were slightly lower. That tracks more closely with what is happening in Greater Palm Springs than the national headline does.
California’s affordability picture also remains difficult. Even though statewide affordability improved in the first quarter of 2026, only a minority of households could afford to purchase a median-priced single-family home. The Inland Empire remained more affordable than coastal California, but the income required to buy a home was still substantial.
That matters for Greater Palm Springs because the region is not a single buyer market. It draws local households, retirees, second-home owners, investors, remote workers, vacation-home buyers and people relocating from coastal markets. Each group reacts differently to mortgage rates, stock market volatility, insurance costs and lifestyle demand.
A $650,000 single-family median price may look like relative value to some coastal buyers. It may look out of reach to many local workers.
That divide remains one of the defining realities of the Coachella Valley housing market.
The Local Economy Depends On Housing Mobility
Housing is not just a household issue in Greater Palm Springs. It is an economic development issue.
When homes sell, money moves through the regional economy. Real estate agents, mortgage professionals, escrow companies, inspectors, appraisers, contractors, landscapers, furniture stores and home service providers all benefit. When sales slow, the impact extends beyond buyers and sellers.
May’s single-family pending activity is therefore encouraging. It suggests there may still be enough buyer engagement to keep transactions moving into early summer. But the decline in closed sales and the sharp drop in condo activity indicate that the market is not showing broad strength across all segments.
For a region that depends heavily on hospitality, health care, public services, construction, small business ownership and seasonal wealth, housing affordability also affects workforce stability.
If local workers cannot reasonably buy, or even rent, near their jobs, the region’s labor market becomes more strained. If too much of the ownership market is driven by outside wealth, the disconnect between local wages and home prices becomes harder to solve.
The May data does not answer those structural questions. But it does show that price sensitivity is now affecting even a market long supported by lifestyle demand.
For the regional economy, the message is more nuanced. Housing activity has not stalled. But the market is no longer forgiving.
“This is a market where deals are getting done,” Gordon said. “They just have to make sense.”
