March 4, 2011 (Jeff Alan)
ZipRealty reports that in more than half the markets they surveyed, sellers are averaging at least two reductions in price in an attempt to entice buyers to purchase their homes. The Monthly Price Reduction Index Report shows that inventory is up a modest 2.81 percent from January 2010 but the total number of homes where sellers have to cut their asking price at least once was up 17.6 percent.
January saw fewer discounted homes for sale than December with the number of price reduced homes slipping from 47.2 percent to 46.2 percent even though price-reduced inventory outstripped last year’s levels.
“In more than half of the surveyed markets, sellers are averaging at least two reductions in price,” said John Oldham, Director of Marketing for ZipRealty. “Inventory has grown throughout much of the year; as sellers face the pressure of more buying options, they seem to be discounting to attract buyers resulting in list prices being cut for over 46 percent of the homes.”
The report also found that there was virtually no change in median price last month but that there was still markets where median prices dropped significantly, such as Orange County, California, which saw list prices drop $5,000, and some markets that saw median price increases, such as Miami, Florida, where list prices increased $5,000.
Other report highlights include:
– The number of price-reduced homes on the market is up 19.8 percent of January of 2010
– Price-reduced homes fell faster than inventory, with the number of price-reduced homes falling 4.1 percent compared to a 2.1 percent decrease in overall inventory in January as compared to December
– The median reduction amount dropped 1.7 percent to $19,088
– The median list price dropped by .2 percent from December to $225,015, and the average percentage of price reduction amount to list price fell to 7.8 percent in January
– In four major markets, more than half of homes on the market in January included at least one price reduction, down from nine markets in December. Those markets are Phoenix, Jacksonville, Orlando and Baltimore.
– Homes listed for sale in Florida continue to be discounted by the largest percentage of original list price nationwide with Orlando leading (12.5 percent), followed by Jacksonville (12.1 percent) and Miami/Ft. Lauderdale/Palm Beach (11.9 percent)
– Homes with the largest median price reduction in absolute dollars were San Francisco (-$32,500), Orange County, CA (-$31,000), San Diego (-$29,100), Miami/Ft. Lauderdale/Palm Beach (-$25,000), and Seattle (-$25,000)
Tags: ZipRealty, price reductions, discounted homes, price-reduced inventory, median price reduction, list price
