Buyer Power Rises as Homes Sell Below Asking Price

The share of homes trading above ask has fallen to its lowest level in six years.

In September, 25.3 percent of homes sold above their final asking price — down more than 3 percentage points year over year. That’s also the smallest percentage in six years, according to an analysis from real estate brokerage Redfin.

The discount that homes are selling for also has grown. The typical home went off the market for 1.4 percent lower than its final list price versus 0.9 percent last year, per Redfin. 

Metros in Florida and Texas took the biggest hit in September. The discount for typical homes in West Palm Beach (-5.2 percent), Miami (-4.8 percent), Fort Lauderdale (-4.6 percent) and Houston (-3.7 percent) were the largest in the country. The average home went above ask in San Francisco (4.2 percent over), Newark, New Jersey (3.1 percent), San Jose, California (2.2 percent) and Oakland, California (1.7 percent).

The share of homes trading in two weeks also is shrinking: just under 33 percent of properties went under contract within two weeks of hitting the market, a 6 percent year-over-year decrease.

While fall is typically a slower period for residential deals, the sluggishness of this year’s market points to buyers’ skittishness — and growing negotiating power — amid affordability and economic concerns. It also hasn’t helped that there are more homes on the market than there are buyers, almost 37 percent more, according to Redfin.

The typical home also is lingering on the market for the longest period in almost a decade, per Redfin: 50 days. Among the top 10 most populous metropolitan areas in the country, Miami’s homes sat on the market the longest, for a median of 95 days — a month longer than last year, according to a recent analysis of Redfin data by The Real Deal.

Despite these challenges for sellers, home prices continue to rise. The national median home sale price — $435,545 — climbed 1.7 percent in September compared to the same time last year, per Redfin. That was the largest gain in six months.

Prices in Milwaukee (9.1 percent), Detroit (7.9 percent) and Cleveland (7.4 percent) surged the most year over year in September, while three major Texas metros — Dallas (-2.7 percent), Austin (-2.3 percent) and Houston (-1.5 percent) recorded the biggest drop in their median home sale prices.