This morning Trulia, the online real estate search company, announced that “25.6 percent of homes currently on the market in the United States as of October 1, 2009 have experienced at least one price cut. More than one in four current listings on Trulia have been reduced in price for the fourth straight month. The total amount slashed from home prices is $28.4 billion, a $967 million increase from June 2009. The average discount for price-reduced homes continues to hold steady at ten percent off of the original listing price.
It’s surprising that so many sellers are still shooting for prices that are too high for this market. However, I think this presents a real opportunities for serious sellers, such as real estate investors that are still trying to turn over properties in this market, to make their homes stand out by pricing them right from the beginning. This is not time, in my opinion, to shoot a little high or “test the market”. I think this is the time to price the home as aggressively as you can and move it. In many markets prices are continuing to see downward pressure so there is no reward for having your home set on the market.
Back to the report…In the Trulia report the Northeast area of the U.S. saw the most homes reduced while the West saw the biggest cuts.
Five of the ten states with the highest percentage of homes with price reductions are in the Northeast — Massachusetts, Rhode Island, Connecticut, New Hampshire and New Jersey. One in three homes in these states has cut their list price at least once. Seven of the ten states leading the country with the biggest listing price cuts are in the West, where heavy foreclosures have taken their toll. In Nevada, Idaho, Arizona, Wyoming, Hawaii, Utah and California, cuts are an average of 13 percent off the original list price. Of the $28.4 billion slashed nationally, New York, California and Florida account for 35 percent of the total value of reductions.
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