Thursday, January 14, 2010

More power to home sellers?

Sellers seem to be holding their price a little better this month according to a new report on CNBC.  Is this the beginning of a trend of price support in some major markets?  Let's look at the numbers.

According to Trulia's January 1st report, 21% of homes for sale on Jan1st has their prices reduced at least once.  While this might appear to indicate a weak market for sellers it stands in contrast to last month when 22% reduced their price or November when the number was 25.6%.  Trulia began to track this statistic in April of 2009 as a way of rating market strength, and 22% is the lowest it has been (there are fewer sellers discounting) since they started. 

Homes that were discounted were dropped an average of 11%  from the original price.

According to the CNBC article by Diana Orlick,  Coastal markets including Los Angeles and New York City showed the largest improvement, although there was still weakness in the luxury segment of the market with discounts averaging 15% for homes priced at $2 million or above.   The South had the fewest number of homes with price reductions with 20% of homes discounted.  The rest of the country held steady at 22%.