Today Trulia announced that price reductions for home listings currently on the market in the U.S. have increased for the third consecutive month to 26 percent and account for a total reduction of more than $29 billion nationwide. These figures only tell part of the story, however, as modest signs of recovery appear to be emerging across the nation.
Despite the increase of price reduction figures to historic levels, 24 of the 50 largest U.S. cities held steady or dropped compared with data from the previous month. This represents a 50 percent increase from August, which saw 16 cities report positive or unchanged price reduction data. The reduction percentage remains unchanged at 10 percent ($33,892 average price reduction).
“On the surface, the latest price reduction data carries with it conflicting messages,” said Pete Flint, co-founder and CEO, Trulia. “Nationwide, sellers continue to slash prices and this is a worrisome trend. However, we’re seeing gradual improvement in many U.S. cities – several for consecutive months. What this shows us is that while we’re in for a long climb to bring stability back to the housing market and while it’s going to take time, that climb appears to at least be underway in some parts of the country.”
Diverging Developments in the Golden State
In California, price reductions have increased steadily since the tax credit for new homebuyers expired on April 30. Despite this, seven of the state’s eight largest cities report price reductions figures below or in line with the national average. Furthermore, five California cities show improvement when compared with data captured one year earlier.
Sellers Crank Up Price Cuts in Major Midwestern Cities
Price reductions in Minneapolis reached an all-time high of 43 percent. In total, sellers have slashed $34.8 million off homes currently on the market and this is the fifth consecutive month of price reductions at or above 40 percent. Milwaukee also crossed the 40 percent threshold, representing the first time two U.S. cities have reported price cuts above 40 percent since Trulia began tracking home price reductions in April 2009. Cleveland logged the lowest price reductions figure among the largest Midwest cities (31 percent), a full five percent higher than the national average.
September 2010 Price Reductions: top 50 cities based on population. Download chart.
Trulia Price Reductions
Trulia is the first and only national real estate site to provide consumers with the ability to use price reductions as a search filter in their quest to find a deal in today’s market across all 50 states. Trulia’s Price Reduction feature can be accessed from the Trulia homepage and is deeply integrated into the existing search experience on the search results page and via the advanced search tab. Detailed information regarding multiple price reductions and prior sold data is now available on each property listing page.
Providing home buyers with access to price reduction data empowers them to make more informed decisions regarding which home to purchase and helps consumers get the most home for their dollar. Price reduction data also helps home sellers price their homes competitively as more homes come onto the market.
Methodology: All price change data is from live listings on Trulia.com, as of June 1, 2010 and tracks all price reductions from September 1, 2009 to September 1, 2010. This data does not include foreclosure properties. Trulia obtains its listing information from brokers, agents, third party aggregators and Multiple Listing Services (MLSs). The percentage of listings with price reductions includes any non-foreclosure property on Trulia.com that has experienced at least one price reduction since it was first posted on the site. The city level data is for listings within the city boundary, and not for metro areas.