A year ago you would be hard pressed to find a home listed for sale that would reduce its price. If anything, there was a good chance that there would likely be a bidding war from several buyers attempting to purchase the home. Fast forward to the present time and homes are remaining on the market for longer periods of time. As a result, we are seeing more homes resorting to price reductions in order to increase showing activity and interest. When analyzing the data, it appears as though Thursday is the best day of the week to list a home for sale. With this said, what about the most common day of the week to see a price reduction?
With home prices and interest rates remaining high, more buyers are waiting for better deals. Although buyers should always keep a close eye on the market and their search criteria, they may want to pay particularly close attention on Mondays. As it turns out, recent data suggests that earlier in the work week may produce the most price reductions for home listings. In fact, Mondays could be the best time to try and get a home with a price cut as 18% of listings have a price drop on that day in South Florida (based on historical trends). Not far behind were Tuesdays and Wednesdays with 17% of listings having a price reduction during these days. Thursdays came in at 16% and these figures continued to drop as the week went on.
What are typical price cuts?
As the housing market continues to rebalance, we should continue to see more price cuts. Of course, a common occurrence in this market is many sellers are trying to sell their properties for what they would have sold for a year ago, or even earlier this year. As their property sits on the market, reality starts to set in and these sellers end up having to reduce their price. In Palm Beach County, we have seen approximately 26% of active listings employ a price reduction. This figure is up from the 14% that we saw a year earlier. Broward County has seen price drops for about 23% of listings as compared to 13% the year before. As for Dade County, we are seeing 18% of listings with a price reduction as opposed to 11% the year prior.
As for typical price cuts, the median price cut for a home in this market is about 3.4%. Overall, you can expect an average price cut between 2% to 5%. On average, these price cuts tend to translate to anywhere between $10,000 to $15,000.
As always, it is extremely important for buyers and their real estate agent to be diligent with monitoring their local market. In addition to tracking recent sales of comparable properties, it is also important to track the number of days on the market for properties. For buyers, a high number of days on the market combined with a price reduction could signal that the seller may be more negotiable. For sellers, if you have not had a showing for your property in 3 or 4 weeks, it may be time to consider a price reduction.
Are you looking to buy or sell in the South Florida market? We can help! Contact Natasha at Live South Florida Realty, Inc. today! Don’t forget to also download the free Florida Home Search app for your mobile device as well!