Current:Home > InvestHome sellers are cutting list prices as spring buying season starts with higher mortgage rates -MoneySpot
Home sellers are cutting list prices as spring buying season starts with higher mortgage rates
View
Date:2025-04-13 04:11:49
LOS ANGELES (AP) — More homeowners eager to sell their home are lowering their initial asking price in a bid to entice prospective buyers as the spring homebuying season gets going.
Some 14.6% of U.S. homes listed for sale last month had their price lowered, according to Realtor.com. That’s up from 13.2% a year earlier, the first annual increase since May. In January, the percentage of homes on the market with price reductions was 14.7%.
The share of home listings that have had their price lowered is running slightly higher than the monthly average on data going back to January 2017.
That trend bodes well for prospective homebuyers navigating a housing market that remains unaffordable for many Americans. A chronically low supply of homes for sale has kept pushing home prices higher overall even as U.S. home sales slumped the past two years.
“Sellers are cutting prices, but it just means we’re seeing smaller price gains than we would otherwise have seen,” said Danielle Hale, chief economist at Realtor.com.
The pickup in the share of home listings with price cuts is a sign the housing market is shifting back toward a more balanced dynamic between buyers and sellers. Rock-bottom mortgage rates in the first two years of the pandemic armed homebuyers with more purchasing power, which fueled bidding wars, driving the median sale price for previously occupied U.S. homes 42% higher between 2020 and 2022.
“Essentially, the price reductions suggest far more normalcy in the housing market than we’ve seen over the last couple of years,” Hale said.
The share of properties that had their listing price lowered peaked in October 2018 at 21.7%. It got nearly as high as that — 21.5% — in October 2022.
Last year, the percentage of home listings that had their asking price lowered jumped to 18.9% in October, as the average rate on a 30-year mortgage surged to a 23-year high of 7.79%, according to Freddie Mac.
Mortgage rates eased in December amid expectations that inflation has cooled enough for the Federal Reserve begin cutting its key short term rate as soon as this spring. Those expectations were dampened following stronger-than-expected reports on inflation and the economy this year, which led to a rise in mortgage rates through most of February.
That’s put pressure on sellers to scale back their asking price in order to “meet buyers where they are,” Hale said.
That pressure could ease if, as many economists expect, mortgage rates decline this year.
veryGood! (7)
Related
- Megan Fox's ex Brian Austin Green tells Machine Gun Kelly to 'grow up'
- Girl dies from gunshot wound after grabbing Los Angeles deputy’s gun, authorities say
- Elizabeth Berkley gets emotional at screening of cult classic 'Showgirls': 'Look at us now'
- Illinois parole official quits after police say a freed felon attacked a woman and killed her son
- How to watch new prequel series 'Dexter: Original Sin': Premiere date, cast, streaming
- Baltimore Orioles owner Peter Angelos dies at 94
- Get This $10 Luggage Scale that Thousands of Reviewers call Extremely Accurate & Invaluable
- MLB pitcher Dennis Eckersley’s daughter reunited with her son after giving birth in woods in 2022
- Israel lets Palestinians go back to northern Gaza for first time in over a year as cease
- Kamala Harris will meet Guatemalan leader Arévalo on immigration and his anti-corruption drive
Ranking
- Travis Hunter, the 2
- Candiace Dillard Bassett Leaving Real Housewives of Potomac After Season 8
- Drag queen story hour canceled at Lancaster Public Library over package, bomb threats
- Find Out How You Can Get Up To 85% Off These Trendy Michael Kors Bags
- What to watch: O Jolie night
- New York City’s mayor cancels a border trip, citing safety concerns in Mexico
- Navy identifies Florida sailor who died while deployed in Red Sea: He embodied 'selfless character'
- MLB pitcher Dennis Eckersley’s daughter reunited with her son after giving birth in woods in 2022
Recommendation
Costco membership growth 'robust,' even amid fee increase: What to know about earnings release
UFC fighter disqualified for biting opponent, winner celebrates by getting tattoo
Boeing CEO Dave Calhoun to step down by end of year
Mindy Kaling Responds to Rumors She and B.J. Novak Had a Falling Out
Megan Fox's ex Brian Austin Green tells Machine Gun Kelly to 'grow up'
Illinois parole official quits after police say a freed felon attacked a woman and killed her son
Must-Have Items from Amazon's Big Sale That Will Make It Look like a Professional Organized Your Closet
18 dead frozen puppies discovered in Oregon home were meant as snake food, officials say