Buyers in the driver's seat: U.S. homebuyers paid $7,039 less than listing price in July
Thu, 09/10/2009 - 11:42
SEATTLE -- Amid continued falling home prices, U.S. homebuyers are negotiating even more discounts at the bargaining table, according to July's Zillow Real Estate Market Reports. Buyers paid 3.3 percent, or a nearly $7,039, less than the last listing price on homes for sale(1) during the month of July. That is down slightly from 3.5 percent, or $7,630, in June, and substantially down from 4.6 percent ($10,260) in January.
Meanwhile, 22.8 percent of all homes listed for sale on Zillow had at least one listing price reduction(2) as of Sept. 1, 2009. The median U.S. price reduction(3) was 6.5 percent off the original listing price. Homes listed for sale on Zillow during August were listed for a median 96 days(4), up from 91 in July.
Florida homebuyers had the most negotiating power in July, with buyers in the Vero Beach metropolitan statistical area (MSA) paying 10.2 percent, or a median $23,500, less than the last listing price. Buyers in the Sarasota MSA paid 8.2 percent less than list price. The Naples, Daytona Beach, Miami-Fort Lauderdale, Panama City, Punta Gorda, Melbourne, Ocala, Tampa, Jacksonville, Port St. Lucie, Gainesville and Lakeland MSAs also ranked, in that order, in the top 25 markets for negotiation.
There was less or no room for negotiation in some California markets that have been hard-hit by foreclosures. In the El Centro MSA, buyers paid 1.8 percent, or a median of $2,150, more than the listing price. In seven California markets -- Sacramento, Merced, Modesto, Riverside, Stockton, Yuba City and Fresno -- asking price and sale price were the same(5).
"The strong summer selling season in 2009 has led to a decreasing difference between the last listing price and final sale price, but most buyers are still getting some additional discount at selling time," said Zillow Chief Economist Dr. Stan Humphries. "We expected list-to-sale price ratios to fall as the sales volume picked up during the summer, and the California markets are showing strong declines in the discount off the last listing price, relative to levels at the start of the year. This is fueled both by increased sales and high proportion of foreclosures re-sales, which are already priced relatively low.
"The fact that many Florida markets are still showing comparatively higher differences between the last listing price and final sale price suggests that inventory levels are still relatively high, keeping considerable downward pressure on prices and encouraging buyers to seek large discounts off the listing price. Overall, buyers are finding favorable conditions for negotiating prices, and now can be a good time to buy, provided homebuyers are financially prepared with healthy down payments and intend to stay in their home for a minimum of five to seven years."
Top 25 Markets for Negotiating Discounts (ranked by percent difference from last list price to final sale)
Zillow
Median % Median $ Home
Difference Difference Value
from from % of Index Median
Last List For Sale Year- Days
List Price Price Listings Median % Over- Listed
Metropolitan to Final to Final with Price of Price Year on
Statistical Sale Sale Reductions Reduction Change Zillow
Area (1) (1) (2) (6) (4)
United States 3.3% $7,039 22.8% 6.5% -9.9% 96
Vero Beach,
Fla. 10.2% $23,500 17.5% 9.1% -11.6% 106
Sarasota, Fla. 8.2% $20,392 19.9% 8.3% -17.5% 96
Atlantic City,
N.J. 8% $23,082 21.4% 6.9% -7.4% 94
Naples, Fla. 7.8% $27,233 21.1% 9.8% -21.2% 100
Daytona Beach,
Fla. 7.5% $14,246 23.8% 9.2% -22.3% 129
Miami-
Ft. Lauderdale,
Fla. 7.5% $18,658 18.7% 11.4% -20.7% 109
Panama City,
Fla. 7.1% $17,617 19.8% 9.8% -10.3% 135
Punta Gorda,
Fla. 7% $11,677 16% 10.5% -14.3% 145
Melbourne, Fla. 6.6% $11,839 20.9% 8.5% -18.3% 125
Detroit, Mich. 6.5% $7,777 29.1% 10.7% -24% 69
Ocala, Fla. 6.4% $8,960 21.2% 10.5% -12.2% 74
Springfield,
Ohio 6.4% $6,231 21.8% 8% -1.8% 101
Prescott, Ariz. 6.4% $15,919 28.6% 8.7% -19.3% 120
Morristown,
Tenn. 6.3% $11,233 18.9% 6.3% -15.9% 143
Toledo, Ohio 6.1% $7,315 24.8% 7.7% -7.1% 109
Tampa, Fla. 6.1% $10,948 22.8% 9% -19.8% 106
Jacksonville,
Fla. 6% $12,313 29% 7.9% -13% 111
Stamford,
Conn. 5.9% $32,099 26.5% 5.8% -10.4% 110
Port St. Lucie,
Fla. 5.7% $10,289 19.5% 10% -24.5% 124
Grand Rapids,
Mich. 5.6% $6,879 24% 8% -10.8% 101
Chicago, Ill. 5.5% $13,453 29.4% 6% -13% 108
Gainesville,
Fla. 5.5% $9,868 22.1% 6.7% -8.7% 130
Lakeland, Fla. 5.5% $8,757 17.3% 9.4% -23.4% 111
New York, N.Y. 5.4% $21,785 25% 5.9% -9.7% 110
Cleveland,
Ohio 5.4% $7,424 25.4% 6.7% -5.3% 86
The full national report for 161 MSAs, in its new, interactive format, is available at www.zillow.com/local-info, or by emailing press@zillow.com. Additionally, in most areas data is available at the state, metro, county, city, ZIP and neighborhood level.
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