Sellers Drop Prices By $27.4 billion
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Foreclosures are impacting the marketplace and even the homes of the rich are going for less these days.
A new study by Trulia says that 23.6 percent of current homes on the market have had at least one price cut and that the reductions are valued at $27.4 billion. The company says “the average price-reduced home has seen a listing price reduction of 10.6 percent.”
The study finds that “of the top 50 cities in the U.S. based on population, 33 have seen 25 percent or more of home listings reduced in price, higher than the national average of 23.6 percent.”
U.S. cities that have seen at least 30 percent of homes reduced in price include:
• Jacksonville, Florida – 36 percent
• Tucson, Arizona – 32 percent
• Boston, Massachusetts – 32 percent
• Los Angeles, California – 32 percent
• Columbus, Ohio – 31 percent
• Dallas, Texas – 31 percent
• Honolulu, Hawaii – 31 percent
• Minneapolis, Minnesota – 31 percent
• Austin, Texas – 30 percent
• Washington, DC – 30 percent
• Baltimore, Maryland – 30 percent
• Las Vegas, Nevada – 30 percent
“Summer time is the peak season for buying and selling, and with some of the lowest prices in the last decade, we expect to it be a busy season,” said Pete Flint, Trulia co-founder and CEO. “Everyone wants to think they are getting the best deal available and price reductions are helping to spark a renewed interest in the U.S. real estate market.”
Foreclosures
The national average for price reductions on current home listings is 10.6 percent, says the company, but sellers in the areas hardest hit by foreclosures are slashing prices the most. Detroit home owners on average reduce their homes by 23 percent, while Las Vegas sellers reduce their homes by 16 percent and Miami sellers reduce their homes by 15 percent. Phoenix and Mesa are also experiencing deep price reductions with 13 percent slashed off the original listing price.
Luxury Market
Trulia also says that 24 percent of homes with a selling price greater than $2 million are seeing price reductions compared to 23.6 percent of homes on the market for the less than $2 million. While the percentage of homes seeing discounts are almost identical, discounts on luxury homes are significantly more with 14.3 percent being slashed off the original listing price compared to only 9.7 percent of homes under the $2 million dollar price tag.
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