Trulia’s November Price Reduction Report - Home Sellers Cut $28.1 Billion off Asking Prices

Wed, Nov 11, 2009

Our November home price reduction report shows 25.6% of U.S. homes as of November 1, 2009 have experienced at least 1 price cut of their original asking price during the last 12 months. The total amount slashed off of active for sale listings by home sellers is $28.1billion. The average national price reduction remains 10%. Over 40% of the top 50 metros around the U.S. have price reduction levels above 30%, much higher than the national average.

November Price Reduction Highlights

25.6% of U.S. homes as of November 1, 2009 have experienced at least 1 price cut of their original asking price
$28.1 Billion in price reductions
Average national price reduction remains 10%
Minneapolis, Minnesota leads the nation in price reductions for the 1st time with 39%
Luxury homes priced $2 million plus seeing an average of 14% cut vs. the national average of 10%
Luxury homes over $2,000,000 on Trulia = 2% but = 25% of the $28.1 billion in home price reductions

Northeast Continues With Most Homes Reduced

The Northeast continues to see the highest level of price reductions, with 29 percent of current listings experiencing at least one price cut—Connecticut, Massachusetts, Rhode Island and New Hampshire are all seeing over 30 percent of listings with price reductions. (Regions according to the U.S. Census Bureau)

Northeast- 29% of listings with price reductions
Midwest- 28% of listings with price reductions
West- 25% of listings with price reductions
South- 24% of listings with price reductions

“With mortgage rates still low and the expansion of the tax credit to trade-up buyers, we could see significant inventory—both new and “shadow inventory”—hit the market during the next four-to-six months,” said Pete Flint, Trulia co-founder and CEO. “Inventory levels this quarter are poised to be atypical of a normal real estate market, which could create tremendous pressure on sellers to price their homes competitively and move their property before the tax credit expires on April 30^th.”

Cities experiencing significant increases in percentage of listings with price reductions from June 2009 to November 2009 include:

Kansas City, MO – 59% increase in price reductions
Colorado Springs, CO – 43% increase in price reductions
Omaha, NE – 39% increase in price reductions
Louisville, KY – 37% increase in price reductions
Milwaukee, WI – 30% increase in price reductions

Cities showing signs the highest percentage of declines for listings with price reductions from June 2009 to November 2009 include:

Las Vegas, NV– 34% decrease in price reductions
San Jose, CA – 25% decrease in price reductions
San Antonio, TX – 18% decrease in price reductions
Los Angeles, CA – 16% decrease in price reductions
Oakland, CA – 16% decrease in price reductions

Luxury Market Still Hardest Hit

Luxury homes (those listed at two million dollars and above) continue to bear the brunt of discounts being offered with an average of 14 percent being slashed from the original asking price compared to the national average of ten percent. Additionally, luxury homes represent less than two percent of all current listings on Trulia, but are responsible for 25 percent of the $28.1 billion in home price reductions.

November Price Reductions – Top 50 U.S. Cities