US Home Sellers Cut Asking Prices as Market Shifts Toward Buyers
Redfin housing market data shows that during the four weeks ending Sept. 20, active U.S. home listings saw price reductions from over 20% of sellers, setting a new high for this period. The national figure reached 21.1%, the highest share for this time of year since Redfin began tracking it in 2022.
Denver and Texas Metros Lead National Price Reductions
Among the 50 most populous U.S. metro areas analyzed by Redfin using multiple listing service (MLS) data, Denver recorded the highest share of active listings with a price cut at 30.9%. Indianapolis followed closely at 29.9%. Three Texas metropolitan areas rounded out the top five: San Antonio at 26.8%, Dallas at 26.6%, and Austin at 26.1%. Conversely, San Francisco registered the lowest share of price cuts at just 9.6%, supported by an influx of capital from highly paid artificial intelligence workers employed at companies like OpenAI and Anthropic.
National Numbers Favor Buyers While Regional Inventory Remains Tight
Nationally, sellers outnumbered buyers by 58% in August, according to Redfin estimates, marking the widest gap in records dating back to 2013. However, regional economists dispute a blanket buyer’s market label. Lisa Sturtevant, chief economist at Bright MLS, told Fortune that inventory remains tight and prices stay near record highs across the mid-Atlantic region spanning six states and Washington, D.C., despite an increase in local price reductions.
Rising Mortgage Rates Stretch Buyer Affordability Limits
Borrowing costs continue to pressure potential homebuyers as the average rate on a 30-year fixed mortgage climbed to 7.28% as of Oct. 1, according to Freddie Mac data. This rate represents an increase from 6.34% one year prior and stands at its highest level since November 2023. Sturtevant noted that many prospective buyers have reached the limits of their purchasing capacity under these higher rates, leaving price cuts as a necessary adjustment for sellers rather than an open invitation for all buyers.
All-Cash Buyers Capitalize on Market Uncertainty
For buyers holding sufficient capital, current market friction presents a distinct financial advantage. the best time and place to buy with all cash is during periods of uncertainty and illiquidity,
Michael Reher, an associate professor of finance at UC San Diego’s Rady School of Management, told Fortune. Reher co-authored research demonstrating that all-cash buyers pay approximately 10% less on average than those relying on mortgages, as sellers accept lower offers to eliminate the risk of a financed deal falling through.
Sellers Remove Listings to Avoid Price Cuts
Why are some sellers pulling homes off the market instead of cutting prices?
According to Redfin, some would-be sellers are choosing to delay listing their properties or removing active listings entirely rather than accept less, while others are opting to price their homes realistically from the outset.
Which major metro areas remain seller’s markets?
San Francisco recorded the lowest share of price cuts at 9.6%, followed by Newark at 12.2%, Chicago at 13.3%, New York at 13.6%, and Miami at 13.7%, according to Redfin’s analysis of the 50 most populous U.S. metro areas.
How much of a discount do all-cash buyers typically receive?
Research co-authored by UC San Diego finance professor Michael Reher shows that all-cash buyers pay about 10% less on average than buyers using mortgages, as sellers discount prices to avoid financing fall-through risks.