Record Share Of Homesellers Slash Prices

Home sellers are slashing prices at a record pace as buyer activity falls off, Redfin reported.

The median asking price for newly-listed homes saw decreased acceleration, rising 15% YOY.

It is down 1.5% from its all-time high, which it hit in May. At the same time, a record share of sellers cut their asking price in the four-week period ending June 26.

Pending home sales saw their biggest drop since May 2020, as evidence emerges that buyer demand is beginning to cool.

But Redfin Chief Economist Daryl Fairweather says buyers aren’t done yet. Instead, they’re noticing “the shift in power, and are no longer leaving the market in droves.”

That is, buyers are seeing that sellers are losing the upper hand, and may feel empowered to re-enter the market despite rate increases.

Redfin’s Homebuyer Demand Index was down 15% YOY, but up 7 points from the week prior. Plus, loan applications have stopped their freefall and are inching up.

“Buyers coming back will provide support to the housing market, but between now and the end of year I think the power will continue to shift towards buyers, resulting in mild price declines from month to month,” Fairweather added.

The average purchase loan amount has dropped since it hit a record-high $460,000 in March 2022 and is now down to $413,500.

“Homebuyers are worried about interest rates, having to go back to the office, getting laid off, and wondering if they can get a better deal by waiting out the market,” said Redfin Seattle-area real estate agent Caroline Loudenback.

“On the other side, sellers are adjusting to this new reality and learning that sometimes there’s not much they can do to increase buyer interest…It’s a tricky market and you have to pay close attention to your local sales and listings to understand what’s happening.”