A Few Home Sellers Drop Prices as Market Slows

Redfin reports the home market may be slowing with 5% of sellers dropping their prices in recent weeks.

“The housing market is less hectic than it was in early spring, but it’s still far from typical. The move to a less imbalanced market is happening slowly,” said Redfin Chief Economist Daryl Fairweather. “As we approach the beginning of back-to-school season, home prices typically cool, supply winds down, and homes take longer to sell. All that’s happening, just very slowly. I don’t think the housing market will return to a fully typical state anytime soon, but we are starting to trend in that direction.”

In its report, the online brokerage noted while home prices are still rising and homes are selling very quickly, a slowdown is surfacing. Redfin added some home sellers who are optimistic about the price they can get are seeing a week or two go by without any bids and scaling back the ask.

For the four weeks ended August 15, the firm said asking prices of newly listed homes were up 10% from the same time a year ago to a median of $353,347, the lowest level since mid-April, down 2.2% from the all-time high set during the four-week period ending June 27.

In another sign of a slowdown, Redfin said pending home sales were up 10%, the smallest increase since the four-week period ending June 28, 2020.

Pending sales also were down 7% from their 2021 peak during the four-week period ending May 30, the company added.

Separately, Zillow has cautioned there are signs the home value appreciation surge is cooling despite rising to a new record high near $300,000 in July.

The warning factors the company cited include inventory rising for the third consecutive month, higher inflation which could hike mortgage interest rates, and home value appreciation showing declining month-over-month growth in July than they did in June.in 22 of the nation’s largest 50 metro markets.

“We will likely see moderation in home price growth coming in the near future. Nationwide and in all 50 of the largest metros, the share of for-sale listings that experienced a price cut increased from June, and in 47 metros and the US as a whole the median time a home stayed on the market before selling stayed the same or increased from June. All signs point to the likelihood that the market is beginning to cool off,” Zillow said.

Earlier in the week, Redfin said the homebuyer bidding war seen by its agents has dropped to the lowest rate since January. About 60% of offers written by Redfin agents faced competition in July, down from 65.5% in June.

The brokerage attributed the decline to an increase in housing supply. Increased supply gives buyers more options to choose from, which helps reduce competition and stabilizes prices. But the company also says it’s typical for competition to ease in the summer following the spring homebuying season.