Ask The Experts: STOVALL TEAM.

Q. What does the increase in the number of price reductions mean to the Real Estate Market? Is it a buyer’s market?

A. The housing market has tilted sharply in favor of sellers over the past two years, but there are very early preliminary signs that the winds may be starting to shift ever-so-slightly. In mid August, in a new report from Zillow, it was revealed that there has been a rash of price reductions across the country. According to the report: 1. There are more price cuts now than a year ago in over two-thirds of the nation’s largest metros; 2. About 14% of all listings had a price cut in June; 3. Since the beginning of the year, the share of listings with a price cut increased 1.2%; 4. This is the greatest  January-to-June increase ever reported, and more than double the January-to-June increase last year. What this DOESN’T MEAN for the real estate market… This doesn’t mean home values have depreciated or are about to depreciate. A seller may put a home worth $900,000 on the market for $925,000 hoping a bidding war will occur and an overanxious buyer will pay more than its actual value. That has happened often over the last few years, especially in areas where we continue to have low-inventory. If the seller gets no offers and reduces the price to $900,000, it doesn’t mean the home dropped in value. It is still worth $900,000. We believe that home prices will continue to appreciate over the next 12 months and it’s far too soon to call this a buyer’s market but the frenetic pace of the housing market over the past few years is starting to return toward a more normal trend and healthy market. What this DOES MEAN for the real estate market… This does mean that sellers should be more conservative when it comes to the price at which they list their homes and work with agents with proven track records of success like the Stovall Team. Sellers have been listing their homes at inflated prices hoping a super-hot market will deliver a buyer willing to pay virtually any price to ensure they don’t lose the house. That strategy has worked somewhat successfully over the last two years. However, the time that strategy would have worked may have passed. Prices are not depreciating. However, if you want to sell your house quickly and with the least amount of hassles, work with a professional Realtor like Stovall Team. Call us today at 714.343.9294 We are here to invest in your family’s future with you. At Stovall Team we are focused on helping you understand the process while helping you find your dream home.

Sources: Micah Stovall, Stovall Team