Buyer’s Market Emerging as Sellers Lose Pricing Power MABA MassachusettsRealEstate FirstTimeHomeBuyers MaBuyerAgent

A new Redfin report revealed that just over twenty eight percent of homes in the U.S. are currently being sold for more than the asking price, a decrease from an estimated thirty two percent a year ago This marks the lowest percentage for this time of year since 2020, when the onset of the global COVID-19 pandemic caused the housing market to come to a standstill.

The good news for optimistic home shoppers is, this statistic indicates a transition towards a buyer’s market in many regions across the country. For context, over half (fifty three percent) of homes were sold above their list price during this same timeframe in 2022, a period when the housing market was predominantly advantageous for sellers.

The number of U.S. homes sold for more than the asking price has decreased year-over-year (YoY) in all but five of the largest metropolitan areas in the U.S. San Jose, CA; Anaheim, CA; and Oakland CA; saw the largest declines, despite the fact that over fifty percent of residences continue to sell for prices exceeding the asking amount in San Jose and Oakland.

“It’s still tough for many Americans to buy a home, as affordability remains a real challenge, but house hunters should know that sellers are accepting offers below asking price and giving concessions to get deals done,” said Chen Zhao, Head of Economics Research for Redfin. “Buyers have negotiating power, especially if they’re flexible on timing or location, or if they’re willing to take on a fixer upper. Buyers should negotiate, and be prepared to move on to other homes if a seller is unwilling to meet them halfway; they may be able to get a better deal elsewhere.”

Pending Sales, Prices & Preferences

Pending U.S. home sales have decreased by one point one percent year-over-year (YoY), reaching their lowest level for this time of year, according to Redfin’s records. Currently, just over one-third (thirty seven point six percent) of homes are going under contract within two weeks, which is the lowest rate for this period since 2020. Additionally, there has been a significant gap between the median list price and the median sale price over the past few weeks.

The median sale price stands at $397,000, reflecting a discount of $28,950 (or 7%) from the median list price of approximately $425,950. In contrast, during the seller’s market of 2021 and early 2022, the median sale price was generally much higher than the median list price.

Potential homebuyers are being held back by ongoing economic uncertainty and high housing costs. The median monthly payment for housing is only $29 below its all-time high, with mortgage rates approaching seven percent. Sale prices have increased by one point six percent compared to last year, although they are currently lower than their original listing prices.

New listings have increased by five point two percent compared to last year on the selling side. There are currently more home sellers than buyers in the market. However, it’s important to note that mortgage purchase applications have risen by ten percent week-over-week, suggesting that pending home sales may improve soon.

Key Housing Market Highlights — National

Note: Redfin’s national metrics include data from 400 plus U.S. metro areas, and are based on homes listed and/or sold during the period. Weekly housing-market data goes back through 2015. Subject to revision.

Regional Trends Vary Across the Nation

The daily average thirty year fixed mortgage rate was six point eighty nine percent as of June 11, down from six point ninety seven percent one week earlier and down from seven point seventeen percent YoY. The weekly average thirty year fixed mortgage rate was six point eighty five percent as of the week ending June 5, down slightly from a week earlier, but near the highest level since February and down from six point ninety nine peercent YoY—according to Freddie Mac.

The top five metros with biggest YoY increases in pending sales:

1. Cincinnati (ten percent)
2. Chicago (six point six percent)
3. Indianapolis (six point three percent)
4. Montgomery County, PA (four point one percent)
5. Cleveland (three point five percent)

Metros with biggest YoY decreases in pending sales:

1. Miami (negative twenty seven percent)
2. San Jose, CA (negative eighteen point eight percent)
3. Las Vegas (negative fifteen point three percent)
4. Fort Lauderdale, FL (negative fourteen point four percent)
5. Fort Worth, Texas (negative fourteen percent)

The top five metros with biggest YoY increases in new listings:

1. Houston (fifteen point three percent)
2. Columbus, Ohio (twelve point four percent)
3. Boston (eleven point five percent)
4. Indianapolis (eleven point four percent)
5. Cincinnati (ten point six percent)

The top five metros with biggest YoY decreases in new listings:

1. Fort Worth, Texas (negative eleven point eight percent)
2. Tampa, FL (negative nine point seven percent)
3. Orlando, FL (negative nine point two percent)
4. Fort Lauderdale, FL (negative nine percent)
5. Dallas (negative eight point two percent)

The top five metros with biggest YoY increases in median sale price:

1. Detroit (eight point seven percent)
2. New York (five point seven percent)
3. Pittsburgh (five point six percent)
4. Virginia Beach, VA (five point three percent)
5. Chicago (five point two percent)

Overall, the median U.S. sale price for the average home declined in Ten metros.

The top five metros with biggest YoY decreases in median sale price:

1. Oakland, CA (negative seven point six percent)
2. Dallas (negative four point nine percent)
3. Jacksonville, FL (negative three point nine percent)
4. Tampa, FL (negative two point four percent)
5. San Diego (negative two point one percent)

One indication of the shift toward a buyer’s market in much of the country is the change in home sales. For comparison, during this period in 2022, homes sold above their list price increased by more than fifty percent, reflecting a market that strongly favored sellers at that time.

Wherever Americans choose to settle down, U.S. housing prices, trends and buyer preferences will continue to change.

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