1 in 4 sellers drop their price
Home buyers have a lot to celebrate. Not only was home price growth at its lowest point in four years last month, but inventory crunches are starting to let up, too. Add in that more than 25 percent of sellers dropped their home’s listing price in August, and it seems we might have a buyer’s market sooner than many expected.
The continuing dip in price growth
According to Redfin, home prices hit their slowest growth rate since August 2014 last month, with just a 4.7 percent uptick over the year. For the month, prices actually declined — dipping 0.6 percent since July. The growth rate has declined for six consecutive months.
But that’s not the only stat that can bring home buyers more hope. Redfin found that 26.6 percent of sellers dropped their listing price last month — the largest share since 2010. To top it off, the number of homes selling above asking price dropped, too.
As Taylor Marr, Redfin senior economist explains, “While sale prices moderate, new listing prices keep accelerating. This mismatch between seller expectations and reality is fueling an increase in price drops in metros across the country.”
Home price drops were most common in Las Vegas; San Jose, California; Seattle; and Atlanta. In Las Vegas,28 percent of homes saw a price drop in August.
Inventory drops ease up
Redfin also found that inventory declines have started to stall out. In August, housing inventory dipped just 3.4 percent — the smallest drop in more than two years.
This easing up of inventory crunches is likely giving buyers more confidence. According to Redfin’s Housing Demand Index, buyer demand was flat in July — and has been for three months. Additionally, there was a 1.1 percent decline in requested home tours and a 12 percent decrease in offers.
“Just above 120, the Redfin Housing Demand Index signals that homebuyer demand remains pent-up at a relatively strong level,” said Sheharyar Bokhari, senior economist at Redfin. “However, the fact that tour and offer activity is not surging alongside inventory in hot markets like Seattle and San Diego, suggests that there’s a mismatch between what sellers are offering and what buyers want.”
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It seems the market may finally be turning around. Want to buy in? Then shop around and see what mortgage rates you qualify for today.