22% Of Sellers Have Cut Their Asking Price In The Highest Share Redfin Has Ever Recorded, And Pending Sales Fell In All 50 Of The Biggest Metros

More than one in five home sellers has had to admit the price was too high. And Redfin says that share has never been bigger.

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In the four weeks ending October 11, 22% of sellers with active listings lowered their asking price. That is up from 20.9% a year earlier and the highest level in Redfin’s records.

The numbers come from Redfin’s October 15 market release.

Asking Prices Fell For The First Time Since March

The median asking price was $396,881 after seasonal adjustment, down 0.3% from a year earlier. That is the first drop since March.

Actual sale prices are still edging up. The median sale price was $391,116, up 0.5%, which is the slowest growth since March.

The release sums it up in four words: “Price drops are at a record high.”

Mortgage Rates Touched A Three Year High On October 8

The weekly average mortgage rate hit 7.4% on October 8, a three-year high. The daily rate was 7.45% on October 14, down from 7.61% about a week earlier.

At 7.4%, the typical monthly payment reached $2,777, up 8.8% from a year ago. Redfin says that was the highest on record except for the week before.

It also compares today’s market with late 2023, when mortgage rates neared 8%.

Pending Sales Fell In All 50 Of The Biggest Metros

Pending sales, meaning signed contracts, totaled 286,531 after seasonal adjustment. That is down 12.7% from a year ago and up 1.5% from the week before. It is near the lowest level in Redfin’s records.

They were down from a year earlier in all 50 of the most populous metro areas. Redfin says this is the first time in three years that pending sales fell in every one of them.

Seattle fell 26%, Atlanta 22.7%, San Diego 22.6%, Denver 19.3% and Minneapolis 18.5%.

Where Prices Are Rising And Falling

The biggest sale price gains among large metros were San Francisco at 18.1%, Detroit at 9.4%, West Palm Beach at 7.8%, Chicago at 5.2% and Newark at 5.1%.

The biggest drops were Seattle at 6.3%, San Jose at 4.8%, Orlando at 3.4%, Charlotte at 2.3% and Anaheim at 2.1%.

New listings were 359,859, down 1.3% from a year ago. Nashville saw new listings jump 22.1%, while Atlanta fell 21.3%.

Supply Is Growing Slowly

Active listings reached 1,506,396, up 2% from a year ago. Months of supply rose to 4.2 from 3.8. Redfin considers 4 to 5 months balanced.

The share of homes that went off the market within two weeks slipped to 29% from 29.6%. The typical home spent a median of 49 days on the market.

About 23.6% of homes sold above list price, and the average sale-to-list ratio was 98.4%.

What A Record Number Of Price Cuts Means For You

When one in five listings is being marked down, a price cut is no longer a sign that something is wrong with the house. It is the market adjusting.

If you are selling, assume your first price will be tested. Decide ahead of time how long you will wait before adjusting.
If you are buying, look at how long a house has been listed and whether the price has already come down. A home that has had a cut may have room for another.
Ask what incentives the seller will offer, from closing-cost help to repairs.
Look at the price history of any house you like. Most listing sites show it.

How To Read A Price Cut On A Listing

A markdown tells a story, but only if you read the dates. A cut in the first week usually means the owner misjudged the market. A third cut after two months usually means the owner is ready to deal.

Compare the new price with what similar houses nearby actually sold for, not with what they were listed for. If the new price is still above those sales, expect more cuts, and do not rush.

If you are the seller, a small cut that barely changes the monthly payment for a buyer is rarely enough to restart interest. A meaningful move, made early, usually works better than a series of tiny ones.

A Buyer’s Edge Is Not The Same As A Bargain

The release frames slowing price growth as possible relief for buyers. Relief is relative when a typical payment sits near $2,800.

A calmer market gives you time to inspect, compare and negotiate. It does not make a house cheap.

The smartest move is the same one that has always worked. Know what you can afford each month, leave room for repairs, taxes and insurance, and walk away from a house that stretches you too far.

Selling In A Slower Market

Sellers have the harder job right now. A well-priced house that is clean, bright and easy to see still sells. A house priced for last year’s market sits and collects markdowns.

Look at what has sold nearby in the last few weeks, not what was listed. Take photos in good light, keep the yard tidy and fix the little things buyers notice, such as a loose railing or a dripping faucet.

Willow and Hearth