Price cuts are popping up everywhere right now, but what they mean can look very different depending on whether you’re buying or selling.
Sellers often worry that a price cut means they’ll walk away with less than expected. Sometimes that happens, but often it simply means the market changed faster than the listing did.
Buyers often assume a price cut means there’s something wrong with the house. Most of the time, that’s not the case.
Here’s what’s really behind those price cuts and why it matters whether you’re buying or selling.
42% of Homes for Sale Are Now Carrying a Price Cut
According to HousingWire Data, the share of sellers cutting their asking price has increased for seven months in a row, as the chart below shows:
Right now, more than 4 in 10 active listings have had at least one price cut, with the typical seller reducing their asking price by about $17,560.
Here’s why it’s happening. With mortgage rates still elevated and more homes to choose from, buyers have more room to wait for the right price. That means sellers who don’t price their home competitively from the start may end up adjusting later.
So, what does this mean for you?
• If you're selling, a price cut isn’t necessarily a red flag. It’s a reminder that pricing your home correctly from the start matters. The market can shift quickly, so even a well priced home may need an adjustment after a few weeks. If that happens, updating the price to match today’s market can help attract more buyers and get you closer to your home’s true market value.
• If you're buying, it’s easy to think a price cut means something is wrong with the home. But with more than 4 in 10 homes seeing price cuts, it often means sellers are adjusting to current market conditions. With affordability still a challenge, that could give you more room to negotiate.
Why Sellers Are Adjusting Faster than Before
HousingWire Data also shows that list prices are trending lower nationally. That can be a sign that sellers are pricing more realistically from the start instead of listing too high and having to cut later. In fact, list prices are down about $26,000 from last year’s peak.
Some of that decline is seasonal, since asking prices typically dip during the winter and pick back up in the spring. So, expect prices to drift a little lower before they start rising again, as the chart below shows:
““That is good news for buyers, who are seeing lower asking prices and more room to negotiate, but it is also good news for sellers: Pricing to today’s demand is helping homes move and keeping more transactions alive in a high-rate environment.”
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With rates still elevated, buyers can only stretch so far. Sellers who price their homes where buyers are today are more likely to make it to closing than those holding out for an unrealistic price. Getting the price right from the start is always better than trying to catch up with the market later.
Buyers, You’ve Got Room To Negotiate Again
At the same time, Redfin data shows that sellers now outnumber buyers by about 58%, marking the widest gap on record, as the chart below shows:
That shifts the balance of the market and makes pricing even more important for homeowners. Right now, about 7 in 10 markets nationwide favor buyers or are moving in that direction.
• For sellers, standing out is just as important as pricing. With more homes to choose from, buyers are comparing your home with the competition. Being a little flexible, whether it’s helping with closing costs or being open to the buyer’s timeline, could help your home stand out.
• For buyers, there may be more opportunities to negotiate on price, closing costs, repairs, or a combination of the three. This can be especially true for homes that have been sitting on the market for several weeks, where sellers may have more flexibility.
Bottom Line
Price cuts are a normal part of today’s housing market, and both buyers and sellers can use them to their advantage. Let’s take a look at what prices are really doing in your neighborhood, so you know where you stand before you list your home or make an offer.
