The number of listing price reductions in major markets like Las Vegas, San Diego, New York and Los Angeles have fallen over 40%. Nationwide, there was a 26% drop this April over the previous year for listing price reductions, but the period ahead should give a clearer indication of the housing market’s sustainability. See the following article from HousingWire for more on this.
The rate of house listings where the seller made at least one reduction in asking price declined 26% at the beginning of April 2010 compared to the same time one year ago, according to research by Trulia.com.
Trulia said 20% of asking prices for current home listings were reduced at least once, compared to 27% of asking prices in April 2009. Las Vegas experienced a 54% decrease in listings with at least one price reduction, from 28% in April 2009 to 13% in April 2010. San Diego experienced a similar decrease at 52%. San Francisco and New York both experienced a 45% year-over-year decline and Los Angeles experienced a 40% drop.
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The decline in the number of properties with price reductions is not necessarily a sign of home price stabilization, but could rather be attributed to sellers properly pricing homes when the properties are originally put on the market. In Seattle, the rate of listings with price reductions increased 15% from last year, and Denver had a similar increase of 5%. Atlanta, Chicago, Philadelphia and Phoenix were even from the previous year.
In addition to the number of homes with price reductions going down, the rate of the asking price cut also decreased in many markets. San Francisco topped the list of the biggest decline of reduction, down to 8% from 13%, a decline of 37%. The discount amount decreased 32% in New York, followed by declines in Boston (23%), Los Angeles (12%) and Las Vegas (8%). Houston saw the biggest increase in the rate of price reduction, up to 8% in 2010 compared to 6% in 2009, a change of 38%. Reductions were up 19% in Denver and Seattle, and up 10% in Phoenix.
“As the federal stimulus comes to an end this month, coupled with expected increases in interest rates and foreclosures, the next few months will be very telling for whether the U.S. housing market can be self-sustaining over the longer-term,” said Trulia co-founder and CEO Pete Flint.
Of the 50 major markets Trulia tracks, Milwaukee has the greatest percentage of homes with reduced asking prices at 34%, followed by Phoenix (32%), Minneapolis (32%), Mesa (31%) and Dallas (30%).
Trulia generates its reports using live listings from its online real estate listings website from listings by brokers, agents, third party aggregators and multiple listing services (MLS). The data does not include recently foreclosed properties on the market.
This article has been republished from HousingWire. You can also view this article at HousingWire, a mortgage and real estate news site.