Report: It's a buyer's market out there
Just over 28% of U.S. homes are selling above the asking price, down from 32% a year earlier, according to a new report from Redfin. That’s the lowest level for this time of year since 2020, when the pandemic brought the housing market to a screeching halt.
According to Redfin, that’s one signal of the shift toward a buyer’s market in much of the country. For the sake of comparison, more than half (53%) of homes sold above list price during this period in 2022, when the housing market was heavily favoring sellers. The share of homes selling above asking price has fallen year over year in all but five of the most populous U.S. metro areas. San Jose, CA, Anaheim, CA, and Oakland CA saw the biggest declines, though more than half of homes are still selling above asking price in San Jose and Oakland.
Redfin offers more data points illustrating the tilt in buyers’ favor, and the slower-than-usual spring market:
- Pending U.S. home sales fell 1.1% year over year to their lowest level for this time of year in Redfin’s records.
- Just over one-third (37.6%) of homes went under contract within two weeks, the lowest level for this time of year since 2020.
- There has been a big gap between the median list price and the median sale price for the last several weeks. The median sale price was $397,000, a $28,950 discount (-7%) from the median list price of roughly $425,950. For comparison, the median sale price was typically much higher than the median list price when the market was favoring sellers in 2021 and early 2022.
Prospective homebuyers remain sidelined by widespread economic uncertainty and high housing costs. The median monthly housing payment is just $29 shy of its record high, with mortgage rates near 7% and sale prices up 1.6% year over year (though sale prices are lower than list prices).
“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, Redfin’s head of economics research. “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.”
On the selling side, new listings are up 5.2% year over year, per Redfin. There are many more home sellers than buyers in the market. But it’s worth noting that mortgage-purchase applications are up 10% week over week, signaling that pending home sales could improve soon.
Get Redfin's full report here.
