A recent analysis by Zillow shows that future home buyers have a better shot to secure their dream home as sellers continue to lower their list prices. Despite the sustained high mortgage rates, buyers are taking advantage of these price cuts to negotiate better deals.
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According to a new analysis from Zillow, future home buyers have a better shot at beating the competition and securing their dream home as sellers continue to cut their listing prices.
Despite the sustained high mortgage rates, buyers are taking advantage of these price cuts to negotiate better deals. Zillow’s Market Heat Index shows that in January there was more negotiation power than any point in the last five years.
Skylar Olsen
“Homeowners are finally back in the market as rate locking becomes easier over time, but buyers are still struggling with high monthly costs,” says Skylar Olsen, Chief Economist at Zillow states.
“Sellers are in a good position and willing to cut prices to close the transaction. Home equity is close to record highs, and the general economy and financial markets are surprisingly strong. Homes are faster than before the pandemic It’s for sale.”
The mortgage rate rose to 7.04% in January. It was the highest level since May 2024. In January 2024, the company was raised to the mid-term 6% range. These rates of increase have made homeownership more difficult, reducing newly pending sales by 3.6% year-on-year.
High mortgage charges are a challenge for buyers, but sellers don’t seem to be too worried.
According to Zillow, the new list from existing owners jumped nearly 12% year-on-year, as a result of rising home equity and motivation from sellers. In the Western market, Portland, Oregon grew 48%, with listings growing the biggest. Seattle has increased by 40%. Denver has increased by 34%.
Buyers are leveraging this influx of lists to strengthen their negotiation position.
In December, almost 25% of the homes were sold at more than the asking price. However, in January, almost 23% of sellers reduced their listing prices. This is the highest percentage in January since 2018.
Price cuts increased the most year-on-year rate in Denver. Las Vegas; San Diego; Austin, Texas. Phoenix (34%); Jacksonville, Fla. (31%); Orlando, Florida and Dallas (both 29%) saw the most widespread reductions.
The houses sold were usually signed within 38 days. At the expensive coastal metro including San Jose, California. Boston; Seattle; Washington, DC, homes sold within two weeks. In contrast, sales moved slowly in the south as New Orleans, Atlanta and several Texas and Florida cities experienced the most relaxed pace.
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