REPORT: One in Four Home Sellers Has Cut List Price at Least Once
Trulia.com: No end in sight to price reductions; New York, Las Vegas and San Diego See Major Increase in Price Reductions Month-Over-Month
By David M. Kinchen
Huntingtonnews.net Real Estate Writer
Twenty-five percent of the home listings on the market in the United States as of August 1, 2010 have experienced at least one price reduction, according to a report issued Wednesday, Aug. 11 by San Francisco-based Trulia.com (www.trulia.com).
This makes August the fourth straight month in increases for national price reduction levels and underscores how the housing market is solidly in the buyer's market camp. The total dollar amount slashed from home prices in America’s 50 largest cities was $30.1 billion, and the average discount on price-reduced homes continued to hold at 10 percent off of the original listing price. The data doesn't include foreclosure properties.
“With one out of every four homes experiencing at least one price reduction, sellers are feeling no relief this summer, in a market climate of fewer qualified buyers and widespread uncertainty about the job market. If buyers are unqualified to buy, it doesn’t matter how low interest rates are or how discounted a home is,” says Pete Flint, co-founder and CEO of Trulia. “I stated at the beginning of the year that I did not expect to see the housing market stabilize or recover in 2010, and I believe that prediction is being proven true today. We will be bouncing around the bottom for months to come. If you are looking to do a short-term buy, this is the wrong market for you. People buying today need to have a plan to stay in their homes over the long term.”
Of the largest 50 American cities, half had price reduction levels of 30 percent or more of the homes for sale. This month, Minneapolis breaks the all-time, national record of having the highest percentage of listings experiencing at least one price reduction (42 percent). Previously, Minneapolis held at 40 percent for the past three months, which set the previous record. No other city has reached this mark since Trulia started tracking home price reductions in April 2009. With an average discount for price-reduced homes at nine percent, the total dollar amount slashed from Minneapolis home prices was $33.8 million.
Cities in Southwestern states experienced some of the largest surges in price reductions. Las Vegas saw the most dramatic increase of 56 percent, month-over-month. Cities in California also experienced notable increases with San Diego and Los Angeles increasing by 15 percent and 12 percent respectively, from July to August. Fresno saw a 28 percent increase in the rate of price reductions, while San Jose experienced a 13 percent increase. New York, which had a 15 percent increase, was the only city on the East Coast to see a double-digit percentage increase.