More buyers are hoping sellers will cut prices, and it appears to happen most often right after the weekend. Days with the fewest price cuts tend to be late in the week.
FORT LAUDERDALE, Fla. – For buyers looking for possible deals in the housing market, there could be a time of week where they might see homes with more price cuts, a new analysis suggests. According to an analysis from Zillow, 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.
“While the housing market rebalances, home shoppers who are able to afford today’s market may be wondering when the best time is to look for a discount on their dream home,” the report noted. “The best day for deals depends on the market.”
Zillow found that Tuesdays and Wednesdays in South Florida also had a higher percentage of homes with price cuts, with 17% of homes having a price cut on those days.
Thursdays had slightly less with about 16% of homes on the market having a price cut, with price cuts diminishing as the week went on.
Mondays, or the beginning of the week, might have more listings with price cuts due to the fact that more showings are happening over the weekend, said Jeff Grant, Realtor® with The Jeff Grant Team in Palm Beach Gardens.
“We are getting to the point where most of the activity is happening on the weekends as far as showings,” Grant said. “If you go through a weekend and there are no showings, that is a good indication that you probably need to cut the price.”
Are price cuts on the rise?
More price cuts are heading to the market as it continues to rebalance, a result of some sellers who have been overzealous with their pricing in trying to catch the record prices of the pandemic boom.
“The main cause of that is that sellers are holding on to what their neighbors got six or eight months ago,” said Ryan Greenblatt, broker associate with Lang Realty in Boca Raton. “The demand has slowed a little bit due to interest rates. The number of people who moved down here wasn’t a sustainable amount. So the amount of people moving here has slowed a little bit.”
According to data from RedFin, about 26% of active listings on the market in Palm Beach County had a price drop, up from 14% a year ago. For Broward County, 23% of active listings had a drop in price, compared to 13% from the year before. And in Miami-Dade County, there were about 18% of active listings with a price drop, a slight uptick from 11% a year ago.
“It’s a combination of homes being overpriced and that prices have come down a couple of percents so far,” Grant said. “Eventually, people who need to sell will price their home a percent or two below the market to have a quicker sale. After a while, as you have more of those aggressive prices come into the mix, it will start to affect those who aren’t in a big hurry to sell.”
Currently, the median sale prices of homes in South Florida are on average about 10% to 15% higher than they were a year ago, though prices have started to slightly decline month to month, according to numbers from the Broward, Palm Beaches and St. Lucie Realtors.
While more price cuts are coming on the market, there are still areas where there is so much demand that sellers don’t need to do a price drop. Waterfront communities, homes in the east and country club areas are all examples of demand still being high.
“We are seeing price cuts but it’s very specific to location,” Greenblatt said. “Where there is more supply, like out west, you might see more price drops.”
What is the typical price cut?
According to Zillow, the median percent price cut for a home on the market is around 3.4%, with Realtors noting on average it will range between 2% to 5%.
On average, it translates to about a decrease of $10,000 to $15,000, said Jeff Zucker, an economist with Zillow.
“It does save buyers money, but it also signals to them that the seller is serious about closing the deal,” he said. “I think it also reassures the buyers that the listing isn’t swarmed with competing offers at the moment.”
How much of a deal a price cut gives a buyer varies as well, depending on how high the home was priced to begin with.
“In most cases to get a deal, a buyer would need to come in lower than the price reduction,” said Grant. “I think if the buyers look at the market and they see a home that has been on the market for 60,70, 80 days and they have had price cuts, that might be an opportunity for them to make a deal with the seller.”
How long the home is on the market before it gets a price cut varies. For homes like a townhome, or a place in a senior community, they might be on the market longer before getting a price cut.
“It all depends on your competition in terms of inventory, your asking price, and whether you are getting showings or not. There’s no official timeline. If you are not getting showings in about three or four weeks, then it’s time to have a conversation,” Greenblatt said.
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